Methods of Payment in International Trade: Cash In Advance скачать в хорошем качестве

Methods of Payment in International Trade: Cash In Advance

There is no point in exporting if you don't get paid for your products. And to get paid, you need to choose the right payment method, to minimize risk while also accommodating your buyer. In this video, we’ll explain how to use cash in advance. ************* Trade Finance Guide:A Quick Reference for U.S. Exporters: https://www.shippingsolutionssoftware... Find 100s of articles about various aspects of exporting on Passages: The International Trade Blog: https://www.shippingsolutionssoftware... Request a free Shipping Solutions demo here: https://www.shippingsolutionssoftware... Download free PDFs of export documents here: https://www.shippingsolutionssoftware... The Beginner's Guide to Export Forms: https://www.shippingsolutionssoftware... ************** There are five primary methods of payment in international trade. Some are more secure for the exporter, others for the importer. The key is finding the right balance. Let’s consider cash in advance. The Advantages of a Cash in Advance With the cash-in-advance payment method, exporters can eliminate credit risk or the risk of non-payment, since payment is received before the buyer assumes ownership of the goods. That makes it the most secure and least risky method of payment for exporters. But, that makes it the least attractive option for a buyer, since it can cause cash-flow problems and concern that the goods will never be sent. So it's often not a competitive option for the exporter, especially when the buyer has other vendors to choose from who offer more attractive payment options. Cash-In-Advance Payment Methods If you do decide on cash-in-advance, there are four typical methods to choose from: 1. Wire Transfer An international wire transfer is the most secure and preferred method for exporters to receive payment in advance. It is commonly used and almost immediate. 2. Credit Card Exporters who sell directly to foreign buyers may select credit cards as a viable cash-in-advance option, especially for small transactions. Exporters should check with their credit card companies for specific rules on international use. The rules differ from domestic use. 3. Escrow Service Exporters may select escrow services as a mutually beneficial cash-in-advance option for small transactions, with importers who demand assurance that the goods will be sent. Cross-border escrow services are offered by international banks and firms that specialize in escrow and other deposit and custody services. Escrow places funds in the hands of a trusted third party, until a specific set of conditions are met. The escrow fee can either be paid in full by one party or split evenly between the two. 4. Payment by Check Getting paid by check is the least attractive cash-in-advance method. A check drawn on the importer's account and mailed to the exporter results in a lengthy collection delay of several weeks to months. That delay defeats the original intention of receiving payment before shipment. When to Use Cash-In-Advance When should you use cash in advance? These factors make it a good option: —The importer is a new customer and has a less-established operating history. —The importer's creditworthiness is doubtful, unsatisfactory or unverifiable. —The political and commercial risks of the importer's home county are very high. —The exporter's product is unique, not available elsewhere, or in heavy demand. —The exporter operates an internet-based business where the acceptance of credit cards is standard. Under the right circumstances, using cash in advance makes sense. But if you have concerns, watch our other videos to learn about other methods of payment, or download the free Trade Finance Guide to compare all five methods. https://www.shippingsolutions.com/tra... *************** Chapters 00:00 Introduction 00:38 The Five Methods of Payment in International Trade 00:54 The Advantages of Cash in Advance 01:30 Cash-in-Advance Payment Methods 01:34 Wire Transfer 01:45 Credit Card 02:03 Escrow Service 02:36 Payment by Check 02:54 When to Use Cash in Advance 03:33 The Trade Finance Guide ************** Make sure you subscribe to this channel for more practical advice for exporters and importers.    / @shippingsolutions   ************** #exportdocumentationsoftware #exportdocuments #usexportinghelp #usexportdocuments #shippingbillforexport #openaccount #cashinadvance #letterofcredit #documentarycollection #consignment #tradefinance