Lets all put PayPal on the shelf and discuss payment and costs. 20 replies,7344 views
PayPal, is not the same in all countries. We have had several discussions on it and there are pro's and Con's to it. It was never designed to be a vehicle for large trade deals. It was merely offered up for buyers and sellers who do their deals on Ebay.
This my own opinnion and IM looking for others to comment as well. The best payment is an L/C it protects both the buyer and the seller provided you understand the terms of the L/C. If you have good trust with the manufacturer the 30% down with remainder paid FOB or CFR is good. This insures that your products have been loaded and have been cleared for export. First time buyers may want to add a product inspection service report be completed also.
If you are buying from a supplier or trading company there is no reason to pay 30% down as you need no good faith payment as the supplier should have the stock on hand and will be paid when the terms have been complied with.
If you are going to insure your load it is best to purchase that in your own country. You may well be able to get it cheaper in the country of origin but, if you need to collect damages you may have some difficulties in collecting them. If you are an infrequent buyer you might buy the insurance per shipment. If your are importing on a more regular basis you may want to take out a larger policy that you pay per year. Most insurance policys such as Lloyds will insure the loads for around 2% of the retail value of the goods. Other may offer it as low as 1.5% of cost + shipping. Just make sure you read the fine print as well.
Custom's Import - this is different for every country and I can not speak to any accept the U.S. When you order products from suppliers you must make sure that you are compliant to the laws. The documents needed for entry are:
A bill of lading, airway bill, or carrier's certificate,
A commercial invoice obtained from the seller,
Entry manifest or Entry/Immediate Delivery,
Packing lists
Having a clean B/L and Certificate of Origin will help speed the process along. For first time importers and infrequent importers, I suggest that you hire a customs broker that can answer all your questions and estimate your duties, tax and or including the ADCVD that may be added. If your not picking your goods up at the port of destination and have not secured your own freight forwarding your broker can also help with this.
This is not all inclusive as there are several ways including inland ports of entry and what is called transportation of merchandise in bond.
IM looking for some good responses from other members on all the points I have covered. Lets just all be business professionals in our responses. As well Im looking for responses from importers in other countries. Exporter's, Manufactuers, Suppliers please jump in as well.
Best regards,
Ranger
Me Tech Supply
ME Tech Supply a D. B. A provides sourcing solutions for both small and medium sized businesses. We are members of the GSAA whose Agents have verified more than 2. 5 million companies World WideWe offer low cos...
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I agree with Ranger that PayPal is not a good choice for large amount deals. Speaking of my own experience, you can't withdraw money from PayPal account in China, and they simply suspend or close your PayPal account when you had a problem to complain. PayPal sucks.
L/C or T/T is the common way to arrange payment, as Ranger said. One thing I want to add is that for some large Chinese manufacturers or well financed trading company, they DO have no problem to do factor to the foreigner buyers--maybe 30 days after B/L date, some even render 60 days after B/L date. All you have to do is establishing trust with your China counterpart, and keeping your promise to pay on time.
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If your developing a relationship with a new supplier its worth your time to do the research about them - their history, maybe run a D&B report to see what their payment histories are like etc. Even calling their bank will usually give you a good response as to whom you are planning on dealing with.
Sure an LC is the safest payment product, but its not feasable for mid to small transactions. Obviously, unless you have a long term relationship with a supplier - and they are willing to assign a "credit" limit to you, you have no choice but to pay them upfront. A wire Transfer is the preffered method. Usually fast, usually accurate (garbage in-garbage out) and traceable. the party on the other end needs an account at a bank (not like western union) so there is a paper trail and potential recourse. Even big companies can crap out on you - look at enron. As a buy, you need to be smart and make sure that the guy thats sellinmg to you isnt just another phone booth on a corner in Manila (or wherever)
yes i agreed
The major and basic principle of doing business is to gain the proper profits. Both supplier and seller want to be economy and always willing to have the guarantee sometime it reach to unbalance in a deal. Buyer or seller always seeks to have the upper hand in every transaction. It?s so natural and I won?t comment about this. But in my opinion, mutual agreement and understanding is essential for new or old or trusted parties or whoever involves in the business deal.
Insurance thing, I have nothing to say. Cause in our country the **** rate issued by the government is not reasonable. So I always buy CIF, CIP but sometime FOB and so I need to buy from third country or request supplier to do it so.
Doing business in Third country, I try very hard to survive and always have to find the way out of the problems and restriction. And the worse is our country is currently under the sanction of US and UN. And also the banks dare not to deal the LC from our country.
So I need to find the bank which can accept the LC from our country. And use third country base office to open LC to supplier?s country. Too complicated procedures have to pass in order to smooth the transaction and get everything in order.
But what I don?t understand is why some banks accept and why some banks cannot. And some US and European supplier still doing business while other are not.
Will share experiences with your all, if you are willing to hear.
Lets say if I act as a broker in an order. And my buyer only wants to use Letter of Credit since the order is over 500 unit or so. My supplier would allow me to use Letter of Credit with him but I don't want the units to be shipped to me, and then I having to file another Letter of Credit with the bank for the buyer. Will a NCND come in handy in this case?
Thanks,
Martin
Dear Ranger,thanks for your good information.
I just applied an account of PayPal two months ago, but I have never used it. I think it is better to use L/C or T/T for mid or large transaction, but for small or some charges of sample, PayPal might be no so bad.
Good luck!
Tony Han.
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1) Paypal does not protect any transactions outside of ebay
2) Paypal does not protect transactions outside of europe, canada and us.
3) Paypal can freeze your money for any reason under the sun for 6 months.
Like people have said, L/C. Paypal is now owned and caters only for ebay. They make money on the fact that your money is stored in thier account and they collect the intrest. In addition to rediculous intrest rates. Even if they protected you, the amount of money you loose on using them isnt worth it.
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i think paypal should be added also it is the most trust system i have found. Paypal wasn't started for ebay, ebay bought it after it was about 4 years old and had pushed out ebay's payment plan. I've been doing sales almost exclusively with paypal for 8 years. It's great for under $2,000.00 transactions, and first time buyers like the security, plus they can pay with credit or credit cards and I don't pay a monthly payment..
If I'm just ordering the first sample, or under $2,000.00 worth of stuff with shipping, I hate having to go to the bank and make a money transfer. There's no help for me if it ends up in a black hole somewhere.
I'm asking for print samples before buying a $25,000,00 printer, and every manufacturer here wants a tiny wire transfer done for shipping and handling. That's ridiculous!
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