Understanding international trade takes some time and research. Working with a freight forwarder, you are guaranteed a wealth of experience and knowledge to help you make the right choices for your business. But, we believe that any investment into the growth of your company should be backed with as much information as possible. So, in this blog, we’ll discuss the 3 different types of international trade – Export Trade, Import Trade and Entrepot Trade.
Export trade is when goods manufactured in a specific country are purchased by the residents of another country. It can also apply to services that are provided in one country and for the benefit of someone living in another country. In this transaction, the seller of the goods or service is known as the exporter. Here in the UK, the majority of our exported products include cars, turbo-jets, medication, gold and crude oil. In June 2021, exports from Britain were valued at £51.2 billion.
If we look at this transaction in reverse, we see import trade. This is where goods or services are brought into one country from another, where they were originally manufactured or created. Goods are normally imported when the country of origin does not have the demand for the goods. Or, where the manufacture of goods in one country is significantly lower than it would be in the receiving country. Goods can also be imported if they cannot be manufactured in the desired country – an example being the import of crude oil.
Also known as transhipment, Entrepot Trade is where goods are imported into a country and then re-exported out, without being distributed within the importing country. For example, if metal is imported from India to Singapore, processed and then re-exported to China, it is entrepot trade. This form of trade is used for a number of reasons, including access to machinery, the development of technology and to help reinforce international relations.
Having a solid, basic knowledge of the workings of international trade ensures you’re informed enough to make the right business decisions. Here at Radius Warehouse and Logistic Services, we have over 25 years of experience offering excellent logistic solutions for worldwide cargo movements. To get started, request a quote or get in contact here today.