Question

please write 1-2 pargragh on how to start a import company. (central america import/cheese import)

mainly focus on the market part. why?

Launch Marketing Strategies, what are the Target Market (Industry / Segment), why?

Answer 1

Importing goods to Central America

Central America includes countries like Costa Rica, El Salvador, Guatemala, Honduras, Nicaragua and Panama. All these countries have different import procedures and restrictions on import. Imported goods are subjected to import duties unless they are exempted by trade treaties. Central America has free trade agreement with USA, hence most of the import and export are to USA.

Importers of goods may be subject to import tax on the imported value of the goods. Imported goods are not legally entered until after the shipment has arrived within the port of entry, delivery of the merchandise has been authorized by import authority, and estimated duties have been paid. Importation and declaration and payment of customs duties is done by the importer of record, which may be the owner of the goods, the purchaser, or a licensed customs broker.

Cheese market in Central America

According to website central America data.com, Central America imported 74,573 tons of cheese and curds in 2016 up by 4% compared to 2015. Having said this, imports have fallen by 1% value wise which means prices of cheese products have reduced in 2016 due to excess import.

The biggest buyers of imported cheese are El Salvador ($127 million), Panama ($ 54 million) and Guatemala ($ 51 million). Most of the cheese product are imported from USA which is primarily because of CAFTA (central America free trade agreement). Except in 2016, Dairy demand in central America is traditionally higher.

Dependency ratio for imported dairy product are higher in countries like Guatemala, El Salvador which indicated that local production of dairy products is not sufficient to meet demand. Since 1994, dairy industry in Central America is growing in the range of 6.6% annually.

Spending per capita on cheese product is also high in these countries which shows that milk products are brought by all level of people irrespective of income level. Data show that people in these countries spend 18% of their income on dairy product .

According to data published by research gate, milk and cheese are biggest constituents of dairy product which is 51% and 35% respectively. Together these two categories make 86% of dairy industry. Hence it is always good to target these sector which is growing by 6.6% annually.