Exporting from the UK
Entering a brand new market can increase sales but beware of falling foul of export/import restrictions, local taxes and other hidden bureaucracy.
Increasing profits through UK exports
If you’ve identified sales growth as one of your primary business targets, then exporting from the UK can transform your turnover if you choose your destination markets carefully. The UK government supports you in principle, but bureaucracy can still choke even the soundest of commercial plans, and specialist legal advice can certainly smooth the way.
Recent research by RBS suggests that Britain’s export growth over the last two decades is the slowest of all the G7 countries. And QualitySolicitors’ own research recently revealed that 72% of UK companies do not export, with perceived barriers being predominantly ‘problems in finding customers’ (33%), ‘lack of working capital’ (32%) and ‘worries about the exchange rate’ (9%).
And yet if there’s a demand for your products, and your margins can absorb a few extra expenses and a fluctuating pound, then selling to ready-made markets outside the UK can be an extremely cost-effective method of significantly improving sales turnover but you must take care to tick all of the many and varied international business law boxes.
You will feel better for having a specialist business lawyer at your side.
Exporting from the UK – a checklist
The QualitySolicitors network of law firms has business specialists in branches all over the country. We’re here to advise you whenever you want, but for now we’ve developed this web page to give you an idea of what you need to consider before exporting from the UK.
Here’s a checklist to get you thinking!
- Is there a foreign market for your product?
- Are there any UK export controls to destination countries?
- What import restrictions are imposed by destination countries?
- Getting UK exports through customs in destination countries
- Is your intellectual property protected?
- Will your contracts protect your UK exports?
- Would using an export agent be more cost effective?
Is there a foreign market for your product?
You know your business and your product offering better than anyone, and it’s pretty clear that you need to be sure there’s a demand for what you want to sell before you can sell it.
Thankfully this sort of research is much easier than it ever has been before, because the internet can get you (virtually) close to pretty much every civilised part of the world. To get started, use your skill and judgment to choose a few economies to analyse, and ask yourself the following questions:
- Are similar products being sold successfully already? (This is a great indicator that you could tap into existing demand)
- What sort of distribution channels are there? (Is the postal system reliable or would you need to employ couriers?)
- What sort of advertising and promotion are competitor companies undertaking? (Find out where other companies advertise, and what they do and don’t do)
- What cultural implications are there? (Would customers expect after-sales service?)
There’s lots of official help out there too. The government’s UK Trade and Investment Department has a useful list of ‘Exporting Country Guides’ that provide statistics and commentary about the stability, economy, business opportunities local etiquette and, crucially, the relationship of that country with the UK.
The Trade and Investment Department also offers very specific free market research help in the form of the Export Marketing Research Scheme, which gives any UK company access to free independent advice about how to choose and approach a foreign market. Grants may be available to help your research too.
After this, you should eventually begin to identify a short list of suitable destination countries.
Are there any UK export controls to destination countries?
It’s possible that you need an export licence to sell your products to other countries.
Products that may require an export licence include weapons, military-related products, foodstuffs, animals, plants, medicine, selected chemicals, and items regarded as antique.
But the rules can change.
You may need an export licence to sell certain commodities to certain countries, but not need a licence to sell those commodities to other countries. And in theory the UK government may impose a restriction on exporting any kind of product to any specific country at any time.
Need legal advice on this? Find out how QualitySolicitors can help you, for free.
What import restrictions are imposed by destination countries?
Some countries may insist you have an import licence, despite the fact that from your point of view you’re exporting.
Other local rules and regulations can affect your ability to sell your products. These include:
Product standards – Consider our own very strict product safety standards when it comes to children’s toys. Some countries have often-surprising very specific standards that you may not have considered.
Labelling – You may be legally required to change how your product is presented, use local language and weight measures, or add or remove information on your packaging.
Marketing – What guidelines must you follow when advertising your products? It’s possible you’re not allowed to use images of minors, or even the product itself, when promoting what you sell.
Need legal advice on this? Find out how QualitySolicitors can help you, for free.
Getting UK exports through customs in destination countries
Although most products sold between EU countries are viewed as being ‘in free circulation’, sending goods to non-EU countries can be subject to certain import taxes when they reach customs in that country.
Local import taxes can include charges for customs duty, excise duty, and sales tax (similar to our own VAT) and it’s usual for the seller to bear these costs and factor these into your selling price.
You’ll also need to consider how long your goods are likely to remain in customs for and factor this into your advertised delivery times.
Need legal advice on this? Find out how QualitySolicitors can help you, for free.
Is your intellectual property protected?
Intellectual property is the legal term for the ‘expression of an idea’ that can include a brand name, the distinctive branding you use to differentiate your product from others, a unique invention, or some unique property of a product that differentiates it from others including packaging and design devices.
Methods of protecting your intellectual property include patents, designs, trademarks and copyright, and while implementing protection may occasionally be cheap and simple, other more weighty protection can be costly and time-consuming.
For example, if you sell a product that’s protected by a patent you registered in the UK and for the UK, it’s not necessarily protected in foreign markets.
So therefore if you want to prevent anyone else from benefiting from your intellectual property then you may have to register a worldwide patent, at a significantly greater cost. Again the UK government has some good free information on protecting your intellectual property.
Naturally we recommend you get good legal advice when dealing with intellectual property.
Will your terms and conditions protect your UK exports?
When exporting overseas your contract terms and conditions of sale need to take into account the different taxes, duties and tariffs that may be applied to your exports.
Your contract terms should clarify your delivery responsibilities, and may include postage, insurance, customs clearance, returns and what happens if delivery is delayed or even not possible.
Of course you also need to consider payment options. Be careful of offering credit, because bad debts are notoriously difficult to chase from across a border.
In fact, if any terms in your contracts are broken, you need to be sure that you have the legal backing to enforce the terms. An impressive-looking business contract isn’t worth much if you can’t actually rely on it to protect you if things go wrong.
Need legal advice on this? Find out how QualitySolicitors can help you, for free.
Would using an export agent be more cost-effective?
Many exporters find it more convenient to deal with an export agent who is experienced in selling and distributing goods in the destination country. Indeed, for many countries, dealing with an agent (sometimes known as a ‘freight forwarder’ is advised by the UK government, and occasionally you’ll find that this is enforced by the destination country’s government).
Agents will have good local contacts with officials, distributors, buyers and sellers in the market itself, but you’ll need very clear legally binding written agreements with such an agent. Establish exactly what your role is and what your agent’s role is, and understand any extra costs that may be payable along the way so you can build these in to your product price accordingly.
Official UK government advice is to not make any payments to anyone that may be construed as ‘bribes’. Agents may occasionally suggest such a payment will be beneficial or even ‘normal practice’ but we advise against this in principle because in most countries bribery payments are now illegal.
Need legal advice on this? Find out how QualitySolicitors can help you, for free.
Getting immediate specialist advice about UK exports
If you need help with any aspect of exporting goods from the UK, then contact us now so we can help you.
We offer everyone Free Initial Assessment, which is a free five-minute chat that enables us all to be clear what your requirements are and how we can help. After that, many business owners choose our Ask the Legal Expert service as an economical way of benefitting from initial face-to-face contact with a specialist business lawyer.
Free Initial Assessment
Call QualitySolicitors on 0808 274 7557 to request a free chat or fill in an enquiry form to get Free Initial Assessment.
One of our friendly legal assistants will then clarify exactly what your export-related issue is, and suggest precisely how we can help you.
So get in touch now; there’s no risk, no charge, and no obligation!
£99 Ask the Legal Expert
Some business owners want straightforward expert help with their export-related legal issues, as soon as possible.
‘Ask the Legal Expert’ is a reassuring face-to-face service with a lawyer who will give you legal advice for only £99.
This service is designed to answer any questions, clarify your rights and give expert guidance on exporting goods from the UK.
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