Paperclips to Airplanes: Classifying Your Products for Export
Published:15 Apr 2014 03:08:53 PST
This entry is part 3 of a series for SMEs interested in exporting.
In our previous entries, we discussed both some reasons for exporting and introduced some resources for starting your market research. With these two background items in mind, we can move on to some of the details in more depth.
A critical step in beginning your research is to determine the correct Schedule B classification numbers for any product you intend to export. This is necessary both in obtaining government help as well as a reporting requirement when you start shipping. The Census Bureau Foreign Trade Division maintains a Schedule B search engine at www.census.gov/scheduleb which takes you step by step through the classification process. As they note, it covers everything "from paperclips to airplanes." Keep in mind that the Schedule B numbers are U.S.-specific; if you're interested in international classifications, the first 6 digits of the Harmonized System (HS Codes or HTS Codes) are globally recognized but the additional digits are only used for U.S. classifications.
You will find that this information, though sometimes difficult to determine correctly, will be a significant help with your market research. At a macro level, the Census Bureau offers data on total U.S. exports of up to ten Schedule B numbers by destination country in its Foreign Trade Selected Commodity Subscription Service. For waterborne trade, PIERS PRO provides shipment-specific data on individual exports including embarkation and destination ports as well as the full text of commodity descriptions directly as entered by shippers. (PIERS offers other products that integrate Census data directly with the U.S. customs records; contact us for details.)
Though it won't apply to the majority of exports, some products require an additional categorization called ECCN (Export Control Classification Number). These relate to specific types of "dual-use" commodities such as telecommunications and electronics, pharmaceuticals, and other specialized technologies. These may require additional clearances from agencies such as the State Department, Defense Department, or others. Each agency has its own procedures which are important to understand so as not to waste time and effort on prohibited markets and prospects. Exporters of paperclips should have no concern - but exporters of airplanes might. A quick check at the link above will provide more information. Embargoed countries are limited to 5 at present: Cuba, Iran, North Korea, Sudan, and Syria, but there are additional parties of concern that also require additional due diligence - check the link for more information.
Duly classified and researched ... you're now ready to find trading partners abroad, the topic of our next entry.
Ready to learn more about PIERS Pro, which includes export searches by HS Codes, to start your research in detail?