What type of company should I set up (Exporting FLCs)?

[schondie]

A UK based company wants me to source canned food to ship from Thailand to the UK. I'll be exporting full containers through a shipping agent.

Do I still need to set up a company with an export licence or would a limited liability company suffice for this?

[Crash999]

Yes and yes, however an easier option is to have the canning company ship directly to your customer in the UK.

[schondie]

Yes and yes, however an easier option is to have the canning company ship directly to your customer in the UK.

Thanks Crash999 for the reply.

Yes, that would be easier to do that but sometimes there's going to be FLCs of pallets from different suppliers so my job is to source, check and coordinate the transport to the docks. Also I will need to show an income to renew my visa etc.

[p_brownstone]

Yes and yes, however an easier option is to have the canning company ship directly to your customer in the UK.

Thanks Crash999 for the reply.

Yes, that would be easier to do that but sometimes there's going to be FLCs of pallets from different suppliers so my job is to source, check and coordinate the transport to the docks. Also I will need to show an income to renew my visa etc.

What's "FLC"? Do you mean FCL as in Full Container Load?

How many Containers do you plan to ship per month? It will need to be a lot - unless you plan to add a significant Margin on the price you charge to your UK Customer of course; which would seem impossible on a simple, competitive and easily available Product such as canned food.

Setting up and operating a Thai Company can be expensive, especially if you want a Work Permit; 4 Staff, Office space, Warehouse space to receive Pallet loads of Product from your Thai suppliers and stuff the Container, Accounting and Audit fees plus whatever Salary you decide to pay yourself to qualify for a Visa / Work Permit.

It can all be a huge monthly overhead .............. and you are not really adding much value to the Product at all. I am surprised a UK Company would think it worthwhile unless the volume is really large, and if the idea is to accumulate Pallet loads from various local suppliers to fill a Container then by definition it would seem volume is not going to be that great.

All-in-all the idea does not seem practical to me, but maybe I'm missing something?

Patrick

Edited September 29, 2015 by p_brownstone

[recycler]

Most important for you is that you make sure you get money on the deals you make and the contacts you get....

[schondie]

Yes and yes, however an easier option is to have the canning company ship directly to your customer in the UK.

Thanks Crash999 for the reply.

Yes, that would be easier to do that but sometimes there's going to be FLCs of pallets from different suppliers so my job is to source, check and coordinate the transport to the docks. Also I will need to show an income to renew my visa etc.

What's "FLC"? Do you mean FCL as in Full Container Load?

How many Containers do you plan to ship per month? It will need to be a lot - unless you plan to add a significant Margin on the price you charge to your UK Customer of course; which would seem impossible on a simple, competitive and easily available Product such as canned food.

Setting up and operating a Thai Company can be expensive, especially if you want a Work Permit; 4 Staff, Office space, Warehouse space to receive Pallet loads of Product from your Thai suppliers and stuff the Container, Accounting and Audit fees plus whatever Salary you decide to pay yourself to qualify for a Visa / Work Permit.

It can all be a huge monthly overhead .............. and you are not really adding much value to the Product at all. I am surprised a UK Company would think it worthwhile unless the volume is really large, and if the idea is to accumulate Pallet loads from various local suppliers to fill a Container then by definition it would seem volume is not going to be that great.

All-in-all the idea does not seem practical to me, but maybe I'm missing something?

Patrick

Yep, my bad FCL not FLC.

We've been doing the maths on operating a Thai company with the four staff and associated costs and yes, the monthly overheads are quite high but I don't see another way of doing it.

As the UK importer has been importing from European countries, he now wants to import from Asia but needs someone he trusts to make sure everything is above board this side. His previous experience with exporting from Thailand was a bit of a shock to him and he'd rather pay me to do it. He vowed never to return here as he is a bit of a clean freak.

Mostly it would be FCLs of canned food, a minimum of 8 containers a month to start with. Sometimes the company wants to test the water with goods that aren't as easy to sell by the container load thus only a few pallets of different products until a container can be filled.

The bottom line is that we agreed that the Thai company will bill his company for pretty much everything we do. Local costs are much cheaper so hourly rates for acting as an agent save him coming back to Thailand, that's all that matters to him.

[bluebluewater]

So your UK importer has tested the waters of SE Asia before and did not like it and now thinks a second bite of the apple will be better?

I would not be spending a lot on upfront costs if I were you. Good chance this second attempt will not end up being a whole lot better.

Insist your UK outfit place whatever your costs for start up are going to be in an escrow account pending the successful completion of a one year test. Then at least if they pull the plug you have covered your nut.

By the by - whatever you think your upfront costs are going to be the actual amount is going to be higher and probably by quite a bit.

Good Luck

[schondie]

So your UK importer has tested the waters of SE Asia before and did not like it and now thinks a second bite of the apple will be better? I would not be spending a lot on upfront costs if I were you. Good chance this second attempt will not end up being a whole lot better. Insist your UK outfit place whatever your costs for start up are going to be in an escrow account pending the successful completion of a one year test. Then at least if they pull the plug you have covered your nut. By the by - whatever you think your upfront costs are going to be the actual amount is going to be higher and probably by quite a bit. Good Luck

The UK importer just didn't like Thailand, then again he only saw the industrial areas and Sukhumvit Road. This is what has put him off returning since 2008. He made a good profit off car and pick up truck accessories but just didn't want to come back here or trust someone he'd never met face to face to do the leg work for him.

My job now is just to arrange samples to be shipped over to him, keep a look out for different products that could sell in the UK and go up to the factory to make sure he is getting what he paid for when the containers are filled.

We've decided to use a shipping company for the first shipments as the costs of setting up the company and associated costs cannot be justified at the present time. I'll learn to walk before trying to run with this.

Thanks for the advice.

[attento]

Do you need a Thai Company ? Could the UK importer pay you on commission, and pay all other charges directly ?

The overheads and risks of running a Company are often underestimated.

[schondie]

Do you need a Thai Company ? Could the UK importer pay you on commission, and pay all other charges directly ?

The overheads and risks of running a Company are often underestimated.

That's what we've now decided on. Everything I spend will be paid into my UK account and just transferred over here.