This is an experience question that cant be found in a book nor have I found it on any website.  But it will tell me something about the people that answer it.

ABC an Australian company wants to buy products from XYZ company in China.  ABC wants to pay via D/P.  ABC wants the items inspected before payment.

Now, how would you go about securing a deal  that is safe for both parties using that form of payment including the inspection.  Don't gereralize be specific.

I've done this myself China to the U.S. but it can be done between any two countries and I will give the answer in 7 days.   The first correct answer that is specific in nature will recieve the 100 MVP points.  This is chance for anyone to show what you know or to keep watching and learn something.  The idea is to define how its safe for both parties given the payment method.  This is a trust builder for both parties without the high anxiety of one party thinking they are going to be ripped off by the other.

Simon heres your chance show me what you know.

Quoting from [Egernia]:

Everyone knows that there are three basic and common payment terms - TT30/70, *, and LC at sight. The requirement of a pre-shipment inspection is kind of a furphy as that does not affect the payment method used and is just good due dilligence practice in addition to the payment method.

Egernia, that is absolutely incorrect. Far from being a "furphy", a requirement for a pre-shipment inspection can and does have a massive impact on choice between payment by 30/70TT or by DP/LC. 

Is your above statement the sort of codswallop you tell new comers - those new comers who respond to your signature line inviting them to put questions to you via TM to receive your secret offline advice?

Quoting from [Ranger]:

This is an experience question that cant be found in a book nor have I found it on any website.  But it will tell me something about the people that answer it.

ABC an Australian company wants to buy products from XYZ company in China.  ABC wants to pay via D/P.  ABC wants the items inspected before payment.

Now, how would you go about securing a deal  that is safe for both parties using that form of payment including the inspection.  Don't gereralize be specific.

I've done this myself China to the U.S. but it can be done between any two countries and I will give the answer in 7 days.   The first correct answer that is specific in nature will recieve the 100 MVP points.  This is chance for anyone to show what you know or to keep watching and learn something.  The idea is to define how its safe for both parties given the payment method.  This is a trust builder for both parties without the high anxiety of one party thinking they are going to be ripped off by the other.

Simon heres your chance show me what you know.

Use an independent inspection company to firstly inspect the goods and also be present when the goods are packed and shipped.

If a small volume use a consolidator whose head office is outside of China to receive the goods and ship, in addition to the above.

Craig Weston

W.T.Exporters P/L

Ranger I appreciate you making the change to the subject of this thread. Hopefully it will now be more inviting to others to give their opinions.

Aussie, I dont normally use emoticons but

Egernia, that's it's buddy ... I like those Smilies ... as the song says ... smile and the whole world smiles with you ... if you think about it, you'll likely find there's enough profound truth behind that thought to turn even the sad heart of the you-know-who Buxiban guy around.     

Quoting from [Ranger]:

This is an experience question that cant be found in a book nor have I found it on any website.  But it will tell me something about the people that answer it.

ABC an Australian company wants to buy products from XYZ company in China.  ABC wants to pay via D/P.  ABC wants the items inspected before payment.

Now, how would you go about securing a deal  that is safe for both parties using that form of payment including the inspection.  Don't gereralize be specific.

I've done this myself China to the U.S. but it can be done between any two countries and I will give the answer in 7 days.   The first correct answer that is specific in nature will recieve the 100 MVP points.  This is chance for anyone to show what you know or to keep watching and learn something.  The idea is to define how its safe for both parties given the payment method.  This is a trust builder for both parties without the high anxiety of one party thinking they are going to be ripped off by the other.

Simon heres your chance show me what you know.

With all due respect, it is totally inappropriate to use this forum in the manner that you are doing.

1. You are trying to indirectly make a statement to other of your payment knowledge.

2. You are indrectly making other feel inferior.

3. You are turning this forum into your own personal stage. I am sure you can take this offline and handle it one one. This is a personal thing and you are showing no consideration to Simon.

4. You will indirectly put off other from posting as they may feel they could be the next target.

One word for this posting "Disappointing" coming from someone like yourself.

I am just waiting for the answer.... I am way out of my depth here.....

but then,,,,,,, ranger already knows that.....lol

Quoting from [Remus]:

 

With all due respect, it is totally inappropriate to use this forum in the manner that you are doing.

1. You are trying to indirectly make a statement to other of your payment knowledge.

2. You are indrectly making other feel inferior.

3. You are turning this forum into your own personal stage. I am sure you can take this offline and handle it one one. This is a personal thing and you are showing no consideration to Simon.

4. You will indirectly put off other from posting as they may feel they could be the next target.

One word for this posting "Disappointing" coming from someone like yourself.

And you are what a parrot? 

Answer the question.  Otherwise whats the point of even responding to the question.  I honored a request to change the question, but then you come in days after I changed it and offer no answer to it so what are you trying to do? 

I get asked all the time to answer questions in the forums.  I don't tuck tail and run away from any of them. 

If you have the answer than show me what you know. 

Is it your contention then that D/P can never be safe for buyer and seller at the same time?

I don't believe that any business that requires a payment up front without proof of product other than a manufacture is valid.  In fact neither myself nor any of my clients would ever accept this with out the supplier offering a surety on the down payment.

Quoting from [Ranger]:

This is an experience question that cant be found in a book nor have I found it on any website.  But it will tell me something about the people that answer it.

ABC an Australian company wants to buy products from XYZ company in China.  ABC wants to pay via D/P.  ABC wants the items inspected before payment.

Now, how would you go about securing a deal  that is safe for both parties using that form of payment including the inspection.  Don't gereralize be specific.

I've done this myself China to the U.S. but it can be done between any two countries and I will give the answer in 7 days.   The first correct answer that is specific in nature will recieve the 100 MVP points.  This is chance for anyone to show what you know or to keep watching and learn something.  The idea is to define how its safe for both parties given the payment method.  This is a trust builder for both parties without the high anxiety of one party thinking they are going to be ripped off by the other.

Simon heres your chance show me what you know.

• A * is a "cash against documents" agreement where the supplier's documents are to be exchanged for the buyer's cash (via their respective banks).
•  Those supplier documents particularly include the Bill of Lading (BL) issued by the freight company after the goods are loaded onto the ship. The buyer of course must present the BL to take delivery of the goods in the destination port.
• The key risk to the buyer is that the goods under the BL might be the wrong or bad quality goods. Ranger has covered this by the buyer requiring a pre-shipment inspection and sensibly the resulting satisfactory inspection certificate would be part of the documents the buyer receives when he hands over the cash (through his bank). So, the buyer is pretty safe provided that the satisfactory inspection certificate is part of the docs.  
• The key risk for the supplier is that the buyer might not pay the cash when the documents are presented to the buyer's bank. You see, unlike a Letter of Credit (LC), payment under a DP transaction is not guaranteed by a bank. So, if the buyer has meanwhile gone broke or merely refuses to pay the money, the supplier is stuck with goods already on a ship headed to the buyer's port, which the supplier must collect and resell..

• What extra step/s can be taken to ensure that the buyer will actually pay when the supplier sends the docs to the banks?
• Or, perhaps more precisely, how can we give payment assurance to the supplier before the supplier either makes the goods or sends them to a freight forwarder for loading onto the ship?

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