IMPORT
LOGISTICS
Dr. LAXMIKANT N. SONI
{Ph. D., M. Com, MBA, MA (Eco.), SET & NET (Commerce),
SET(Economics), NET(Management), DTL, GDC&A}
CONTENTS
01 Introduction-
Import Logistics
02 Import
Documentation
03 Custom
Formalities
04 Warehousing-
Types
Dr. L. N. Soni
Introduction- Import Logistics
Import logistics refers to the process of bringing goods or services
into a country from a foreign source. Importing involves various
activities, including transportation, customs clearance,
documentation, and compliance with the legal and regulatory
requirements of the importing country. The objective of the import
process is to ensure the smooth and efficient flow of goods across
international borders while following to the applicable trade
policies, tariffs, and regulations.
Import logistic is the coordinating process of the flow of goods into
and out of a country into the importing firm. The import process
broadly includes:
❖ Procurement and purchasing
❖ International transportation (air, sea, land)
❖ Customs clearance
❖ Warehousing and inventory management
❖ Delivery to the final destination
Dr. L. N. Soni
Import Documentation
❖ Bill of Entry
❖ Commercial Invoice
❖ Packing List
❖ Bill of Lading or Airway Bill
❖ Import License
❖ Certificate of Origin
❖ Insurance Certificate
Dr. L. N. Soni
Dr. L. N. Soni
Import Documentation
1. Bill of Entry:
A bill of entry is a legal document
that is filed by importers or
customs clearance agents on or
before the arrival of imported
goods. It’s submitted to the
Customs department as a part of
the customs clearance procedure.
Bill of entry should be issued by
firms that import goods from other
countries. The document contains
details of the shipment, shipment
quantity and total custom duty
amount.
Import Documentation
2. Commercial Invoice:
The commercial invoice is one of the most important documents in
international trade. It is a legal document issued by the seller
(exporter) to the buyer (importer) in an international transaction
and serves as a contract and a proof of sale between the buyer and
seller. The commercial invoice shows the price of product, total
value and quantity of the goods being sold. It should also include
the trade or sale conditions agreed upon by both buyer and seller
of the transaction being carried out. It may also be required for
payment purposes.
Dr. L. N. Soni
Import Documentation
3. Packing List:
A packing list is a document used in international trade. It
provides the exporter, international freight forwarder, and
ultimate consignee with information about the shipment,
including how it's packed, the dimensions and weight of each
package, and the marks and numbers that are noted on the outside
of the boxes.
Dr. L. N. Soni
Import Documentation
4. Bill of Lading or Airway Bill:
The Bill of lading (also referred to as B/L) is a document issued by
the Carrier or its agent to the shipper of goods as a contract of
carriage of goods. It is also a receipt for cargo accepted for
transportation. It must be presented for taking delivery of the
goods at the destination. The B/L serves as a proof of ownership
or title of the cargo. An air waybill (AWB) or air consignment note
is a receipt issued by an international airline for goods and an
evidence of the contract of carriage, but it is not a document of
title to the goods.
Dr. L. N. Soni
Import Documentation
5. Import License:
An import license is a government-issued authorization that allows
a business or individual to bring specific goods into a country. This
license is often required for certain products to regulate trade,
ensure safety standards, protect local industries, or comply with
international agreements. Import licenses can vary in terms of
validity, requirements, and processes depending on the country
and the type of goods being imported.
Dr. L. N. Soni
Import Documentation
6. Certificate of Origin:
A Certificate of Origin (CO) is an official document used in
international trade that certifies the country where a product was
manufactured or produced. It serves several purposes:
i. Verification of Origin: It confirms the origin of the goods,
which can affect tariff rates and trade agreements.
ii. Customs Clearance: Many countries require a CO for customs
clearance, ensuring that imported products comply with local
regulations.
iii. Trade Agreements: It helps determine eligibility for
preferential tariff treatment under trade agreements.
The CO is typically issued by a chamber of commerce or a relevant
authority in the exporting country and must be presented
alongside other import documentation.
Dr. L. N. Soni
Dr. L. N. Soni
Import Documentation
7. Insurance Certificate:
An Insurance Certificate for importing goods is a document that
provides proof of insurance coverage for goods being transported
internationally. This certificate is important for several reasons:
i. Risk Protection: It protects the buyer and seller against
potential losses or damages that may occur during transit,
such as theft, damage, or loss due to accidents.
ii. Customs Requirement: Some customs authorities may
require an insurance certificate to ensure that the goods are
adequately covered during transportation.
iii. Claims Process: In case of loss or damage, the insurance
certificate facilitates the claims process with the insurance
provider.
iv. Financial Assurance: It provides assurance to both parties in
the transaction that there is financial protection in place for
the goods.
PROCEDURE FOR CLEARANCE OF
IMPORTED GOODS or Custom Formalities
As per the Customs Act, all goods imported into India must pass
through the procedure of customs for the proper assessment,
appraisal, examination, and evaluation. This process helps the
customs authorities to charge the proper tax and check the goods
against illegal import. Following is the procedure for the
clearance of imported goods in detail:
Dr. L. N. Soni
PROCEDURE FOR CLEARANCE OF
IMPORTED GOODS or Custom Formalities
1. Preparing Import Documents:
Importers need to gather essential documents such as the Bill of
Entry, Commercial Invoice, Packing List, and Import License. These
documents provide information about the imported goods, their
value, and compliance with regulations.
2. Submitting Documents to Customs:
Importers are required to submit the relevant import documents to
the customs authorities electronically or physically, depending on
the designated port or airport. This step initiates the customs
clearance process.
Dr. L. N. Soni
PROCEDURE FOR CLEARANCE OF
IMPORTED GOODS or Custom Formalities
3. Assessment of Customs Duties and Taxes:
Customs authorities assess the customs duties and taxes applicable
to the imported goods. This includes calculating the basic customs
duty, additional duties, and GST based on the declared value of the
goods.
4. Physical Examination and Sampling:
In certain cases, customs authorities may conduct a physical
examination or sampling of the imported goods to verify their
compliance with regulations, quality, and quantity. This step
ensures faithfulness to the prescribed standards.
Dr. L. N. Soni
PROCEDURE FOR CLEARANCE OF
IMPORTED GOODS or Custom Formalities
5. Payment of Customs Duties and Taxes:
Importers are required to make the necessary payment of customs
duties and taxes based on the assessed value. Various payment
methods, such as online transfers or demand drafts, are available
for completing the payment process.
6. Obtaining Customs Release:
Once the customs duties and taxes are paid, importers can obtain
the customs release for their goods. This allows them to take
possession of the imported goods for further distribution or use.
Dr. L. N. Soni
PROCEDURE FOR CLEARANCE OF
IMPORTED GOODS or Custom Formalities
7. Post-Clearance Procedures:
Importers should comply with any post-clearance requirements,
such as maintaining records, reporting to customs authorities, or
fulfilling any additional obligations based on the nature of the
imported goods.
Dr. L. N. Soni
Warehousing- Meaning
Warehousing is a process of storing goods in a warehouse for the purpose of
distribution, sale, or manufacturing. Warehouses are used for storing goods for an
extended period of time and are typically equipped with storage areas, loading docks,
conveyors, and other material-handling equipment. Warehousing also involves the
movement and storage of inventory in and out of the warehouse, as well as the
tracking of goods and inventory.
Basic functions of warehousing:
1. Order Fulfillment: Warehouses are responsible for fulfilling customer orders by
picking, packing, and shipping products.
2. Inventory Management: Warehouses play a major role in keeping track of inventory
levels and ensuring stock is regularly reloaded.
3. Asset Protection: Warehouses must also protect their assets from environmental
factors and theft. They also need to ensure that products are stored in a safe and
secure manner.
Dr. L. N. Soni
Warehousing- Types
In its simplest definition, a warehouse is a large building where goods and
materials are temporarily stored before being sold or exported. A large variety of
companies and businesses might need access to warehouses, especially larger
companies that have grown enough to need more accommodating space for their
products. When a company identifies a need for a warehouse or even multiple
warehouses, they are forced to explore the different types of warehouses to choose
the best one for their specific goods or products.
Each warehouse type will be utilized for a different type of business, so choosing
the best warehouse for your business needs is an important step in ensuring
product and inventory fulfillment goes according to plan.
Dr. L. N. Soni
Warehousing- Types
1. Public Warehouse:
A public warehouse is a warehouse owned by governmental entities that are available
to private sector companies. These types of warehouses can be rented out for business
or personal use. Public warehouses are an especially attractive option for business
owners that might need to only store inventory for a short time as other warehouse
options might be more expensive. Public warehouses are commonly used by new or
growing businesses, such as e-commerce companies and startups, due to their
affordability versus a private warehouse. The following are the key points:
• Accessible to the public
• An affordable option for new businesses
• Great for seasonal businesses
• Ideal for short-term storage
Dr. L. N. Soni
Warehousing- Types
2. Private Warehouse:
Private warehouses are owned by a businessman or company. If a business is
interested in a private warehouse they will need to make a large upfront investment
to secure the building, facilities management, and general maintenance. Private
warehouses are a popular option for wholesalers, distributors, and manufacturers.
While a private warehouse is a more expensive option than a public warehouse, they
offer business owners more overall control of their inventory management.
• Increased control over building facilities
• Great for companies that need a significant long-term presence in a specific region
• Provide a more exclusive location for business operations
Dr. L. N. Soni
Warehousing- Types
3. Smart Warehouse:
An increasingly popular warehouse option is a smart warehouse, which is a
warehouse where the storage and fulfillment processes are automated with AI, such
as robots and drones. The AI is responsible for packing, weighing, transporting, and
storing raw materials, with many incoming orders being automated to be fulfilled
immediately. Smart warehouses have been a go-to option for large e-commerce
companies such as Amazon that seek to make their order fulfillment and inventory
management a more accurate and advanced process.
• Inventory management is more accurate
• Automated functions decrease human error and save on labor
• Increase safety and security within the facility
• Provide insight into overall business efficiency
Dr. L. N. Soni
Warehousing- Types
4. Cooperative Warehouse:
A Cooperative Warehouse is a shared storage facility owned and operated by a
collective of businesses or organizations with similar needs and goals. Unlike
traditional public or private warehouses, where you either rent space or own the
entire facility yourself, a Cooperative Warehouse is a collaborative venture.
Cooperative warehouses in which the management and ownership of the facility are
different. These emerging warehouse models are owned, managed, and controlled by
cooperative societies. The purpose is to offer the least possible costs for storing and
forwarding products. Cooperative warehousing facilities can be provided at the most
economical rates to the members of their society.
Dr. L. N. Soni
Warehousing- Types
5. Bonded Warehouse:
A bonded warehouse is a type of warehouse that stores imported goods before
customs duties are completed and paid for the products. Customs clearance can
be an extensive process, and bonded warehouses provide a safe space for these
goods in the meantime. Government bodies provide businesses a bond to rent
the space to ensure the business doesn’t suffer from any loss of profits once
products are ordered. These features of bonded warehouses can be attractive
for importers that might need short-term or long-term storage.
Dr. L. N. Soni
Warehousing- Types
6. Cold storage Warehouse:
A cold storage warehouse is a warehouse used for the storage of temperature-
sensitive products. Cold storage warehousing might include an entire building
or even a specific portion of a warehouse that can accommodate these goods.
Cold storage warehouses have regulated environmental conditions to ensure
inventory is safe and no losses are suffered before goods are delivered. While
cold storage warehouses seem like any other warehouse from the outside, they
have vastly different inner workings to provide a safe space for these goods.
• Ideal for companies or businesses that sell perishable inventory
• Attractive for businesses that require certain environmental conditions
• Commonly used by pharmaceutical companies
Dr. L. N. Soni
Warehousing- Types
7. Distribution Centre:
Distribution centers are built around the premise of taking large quantities of
inventory in for the purpose of moving it out to retailers and merchants
relatively quickly. Products stored in a distribution center are moved around
quickly within a supply chain. Distribution centers are paramount to the
connection between suppliers and customers and are not simply for inventory
storage but rather distribution, order fulfillment, and shipment preparation.
• Generally affordable to utilize for companies selling to wholesalers
• Designed to increase overall efficiency for inventory management
• Less money is wasted on long-term storage of product
Dr. L. N. Soni
THANK YOU!
Dr. LAXMIKANT N. SONI
{Ph. D., [Link], MBA, MA (Eco.), SET & NET (Commerce), SET(Economics),
NET(Management), DTL, GDC&A}