Business Practices, Preferred Payment Methods &s and Delivery Times of Buyers Around The World
Create Date: 2019-07-08 08:23:22 Last Edited: 2021-04-27 11:00:52
The main part of foreign trade is to deal with customers all over the world. We shall win the customer’s heart by gaining their trust, confidence, and loyalty to our products and services, in order to reach and exceed customer satisfaction. We need to do more work in the early stage to understand the characteristics and local customs of customers, as well as preferred payment methods and delivery time of buyers from all over the world which can help us draw on advantages and avoid disadvantages.
Business practice: After signing the contract, the Russians prefer telegraphic transfer (T/T), and require timely delivery, they rarely use letter of credit (L/C). However, to search a Russian business partner is not that easy, you can only make it through exhibitions or in-depth local visits.
The language used: For local language, they give priority to Russian, English is rare and difficult. Therefore, translators are usually needed.
Business practice: The products in Eastern Europe are not of high quality, but for long-term development, there is no potential for poor quality products.
Business practice: Letter of Credit (L/C) at sight is not generally accepted, but L/C forward payment terms are acceptable.
Order quantity: the order quantity is small, they prefer to see the sample first, then place an order.
Notes: Please ensure the delivery time is not too late. Firstly, the procurement of this country should try to meet the requirements and relevant regulations, and secondly, the quality of products should be improved to meet international standards. The Mexican government stipulates that all imports of electronic products must first apply to the Mexican Ministry of Industry and Commerce for a quality standard certificate (NOM), that is, the import is allowed only if it complies with American Underwriters Laboratories (UL) Standard.
Business practice: Cash on Delivery (COD) or obtain merchandise on credit & sell goods on a commission basis.
Order quantity: There are a wide variety and urgent need for goods, but the order quantity is small.
Notes: the pre-shipment inspection of import and export commodities implemented by African countries will increase the cost of practical trading business, delays the delivery time and hinders the normal development of international trade.
Business practice: Credit cards and checks are commonly used, and it is customary to “consume first and pay later”.
Notes: Because of the limited funds and high bank interest rate (about 22%), they are still accustomed to payment by sight or installment, and L/C at sight is not usually available.
Business practice: Payment by letter of credit, credit period usually takes 90 days, and about 120-150 days for large chain stores.
Order quantity: Order about 200-1000 pieces each time.
Notes: The country does not charge tariffs on its imports. Suppliers should shorten production time, focus on quality and business reputation.
Business practice: Small variety and a large number of products, large order but low profits.
Business practice: Indirect transactions through agents, direct transactions are relatively rare. Requirements for products are not very high compared with Japan, Europe, the United States, and other places. They pay special attention to colors, especially preferred dark items. Although with small profits and small orders, the order volume is relatively stable.
Notes: Firstly, please be particularly careful with the agents to avoid being undercut from multi-aspects. Secondly, more a1ttention should be paid to follow the principle of keeping the promise. As soon as a contract or agreement is signed, you should fulfill obligations, even it is a verbal promise. Last but not least, pay attention to customer inquiries. Keep a good attitude and don’t be too fussy about the sample fees or postal fees.
Business practice: Danish importers are generally willing to accept payment by L/C when doing first business with a foreign exporter. Thereafter, Cash Against Documents, Documents against Payment after Sight (D/P) of 30-90 days, as well as Documents against Acceptance (D/A) are usually used. Besides, they prefer starting with small orders ( sample consignment or trial order).
About tariffs: Denmark offers most-favored-nation clause (MFN) or a more preferential generalized system of preference (GSP) for imports from some developing countries, Eastern European countries and the littoral countries of the Mediterranean. However, in practice, there are few tariff concessions in the steel and textile industries, and countries with large textile exporters tend to adopt their own quotas.
Notes: They required the goods are identical with the sample they ever saw before. And they pay great attention to the delivery time. In the performance of a new contract, the foreign exporter shall specify the specific delivery time and fulfill the delivery obligation in time. Any delayed delivery due to the violation of the delivery time may be canceled by the Danish importer.
Business practice: They adopt the method of Under-Invoicing the value of goods and paying the difference in cash.
Notes: Morocco generally has high import tariffs and strict foreign exchange control. Document Against Payment（D/P）has a greater risk of foreign exchange collection in the export business to this country.
In brief, it is necessary to know the customs, business practice and notes of each country in international trading. And above we talked some of the trading habits of doing business with people around the world, thanks for reading and hope all of you can do business more smoothly and successfully!