Exports 1

[Former Member]

Dear Friends

How to do I map an export 'distributor' in the system? as a PF? Whenever the indian co cd makes a sale to an export customer, that local distributor get a certain predefined commsion from indian co cd.

Also, when indian co cd.. sells to export customer, that country's co cd too get a commision.

Request, an expert who has worked extensively on exports for help & guidance.

Rgds

Sumanth.G

[Lakshmipathi · Accepted solution]

I am not clear on your explanation. I need to some clarifications before giving any suggestion.

1) whether the distributor is within the exporting country

2) whether the distributor receives the goods and then redistribute to overseas customer

3) if he receives the goods and redistribute, whether charges like warehouse rental charges, stocking etc., needs to be captured

4) if the exporter is paying the above charges, then are the exporter paying commission apart from those charges.

Incidentally, I am sure, you would be aware how a Merchant Exporter would act. Merchant Exporters who buy the goods without payment of excise duty from a manufacturer and export the goods in his name.

So you can explore on this if this meets your requirement.

thanks

G. Lakshmipathi

[Former Member · Accepted solution]

Dear Lakshmipathi

I thank you for your prompt response.

Will revert back soon with a better picture.

Rgds

Sumanth.G

[Former Member · Accepted solution]

Dear Mr.Lakshmipathi

1)" whether the distributor is within the exporting country"

Yes, they have trade licenses to trade locally within their country/ies of operation.

2) "whether the distributor' receives' the goods and then 'redistribute' to overseas customer"?

No, they will only "resell" by taking the materials into stock by paying local customs, other duties, etc & not "redistribute".

3) if he receives the goods and redistribute, whether charges like warehouse rental charges, stocking etc., needs to be captured?

The distributor will purchase outright.There is no question of 'redistribution" & hence there are no charges associated to be captured at business's end.

4) if the exporter is paying the above charges, then are the exporter paying commission apart from those charges.?

No. Commsion will only be paid on difference of selling price to end customer & distributor price to distributor in absolute terms/Difference in transfer price to distributor price to "foreign co codes" in predefined %age or absolute terms.

[Former Member · Accepted solution]

Dear Lakshmipathi

Request your expert guidance & help on this. as I am still not sure. Hope, you've got the answers to your questions.

Rgds

Sumanth.G

[Lakshmipathi · Accepted solution]

Whenever the indian co cd makes a sale to an export customer, that 
   local distributor get a certain predefined commsion from indian co cd


No, they will only "resell" by taking the materials into stock by 
    paying local customs, other duties, etc & not "redistribute"

Both the above statements are contradict to each other.

In the first statement, you had indicated that the materials are being exported directly to end customer for which, the exporter has to pay commission to the intermediary agent. In the second statement, you had indicated that the agent receives the goods, pay all charges and resell it. Which is correct ??

Nevertheless, for the first statement, you may go through the following threads from which you can take the inputs.

[Re: HOW CAN WE CONFIGURE COMMISSION AGENT |]

[Re: Create commisson agent partner function|;

On the other hand, if the scenario is second one, then it is altogether a different one. Here the exporter's responsibility ceases once he handed over the goods to agent. So here on what basis, your client is treating this ?? Is it a local sale or an export sale. If it is treated as an exports, On what undertaking it is treated like that ??

Mainly, you need to discuss with the excise people here who plays a major role in this.

thanks

G. Lakshmipathi

[Former Member · Accepted solution]

Dear Lakshmipathi

There are 3 scenarios.

1) Indian co cd invoicing an overseass end customer

a)Invoice price-distributor price=commision for foreign distributor

b)Distributor price- Transfer Price=commision for foreign co cd entity

2) Indian co cd invoicing on overseasa Distributor

a) Invoice price- Transfer price= Commision for Foreign co cd entity.

3)Indian co cd invoicing foreign co cd

Invoicing at Transfer pric- No commision payable

• I am NOT mapping "Intercompany STO' for imports from other co cd.. Thats complicated. Will treat that as foreign vendor.

Lakshmipathi.... Pls help me.

Rgds

Sumanth.G

[Former Member · Accepted solution]

Dear Lakshmipathi

There are 3 scenarios.

1) Indian co cd invoicing an overseass end customer

a)Invoice price-distributor price=commision for foreign distributor

b)Distributor price- Transfer Price=commision for foreign co cd entity

2) Indian co cd invoicing on overseasa Distributor

a) Invoice price- Transfer price= Commision for Foreign co cd entity.

3)Indian co cd invoicing foreign co cd

Invoicing at Transfer pric- No commision payable

• I am NOT mapping "Intercompany STO' for imports from other co cd.. Thats complicated. Will treat that as foreign vendor.

Lakshmipathi... Request you to . pls help me.

Rgds

Sumanth.G

[Lakshmipathi · Accepted solution]

I think, you have not gone through the explanation I have given above and also the link attached therein. Only there are two ways to make an export shipment.

One is direct exports and paying commission to an external agency.

The other one is you deliver the goods to a local agent through whom, the goods are exported.

For the first case, you should once again go through the links provided by me. For the second one, you need to configure the export pricing procedure since tax and duty are exampted but the currency will be local currency.

thanks

G. Lakshmipathi

[Former Member · Accepted solution]

Dear Lakshmipathi

Mine is the 1st case, in your reply.

Rgds

Sumanth.G

Edited by: SUMANTH GURURAJ on Feb 2, 2011 4:24 PM

[Former Member · Accepted solution]

Dear Lakshmipathi

Mine is the 1st case, in your reply.

Rgds

Sumanth.G

[Former Member · Accepted solution]

Dear Lakshmipathi

Mine is the 1st case, in your reply.

So, what way you suggest,as a senior consultant to proceed forward.

Awaiting your kind response at the earliest.

Rgds

Sumanth.G

[Lakshmipathi · Accepted solution]

Follow any of the procedure suggested in the above two threads

thanks

G. Lakshmipathi

[Former Member · Accepted solution]

Dear Lakshmipathi

Pls confirm which procedure.

Thats the help I am requesting from you. I am in designing stage.

Awaiting your reply at the earliest.

Rgds

Sumanth.G

[Lakshmipathi · Accepted solution]

Go with either Bharathi's suggestion in the first thread or usasapsd in the other thread

thanks

G. Lakshmipathi

[Former Member]

answered & closed

[Former Member]

hi,

please dig there is concept called MERCHANDISE EXPORTS.

please check and confirm

balajia

[Former Member]

Dear Balajji

What exactly you mean by merchandise? This is not garment or FMCG or retail project, if I understood you correctly.

Rgds

Sumanth.G