I've bought a small batch of goods for £70GBP


I originally intended to spend £50, but after shipping and payment charges it rose to 70.



I'm happy with the products, and would like to trade with this partner.


However, the factory wants and expects full payment for all good (worth £450) from now on, before shipping off the goods.


This is going to be really bad for my cash flow, I'm a small independant retailer, who sells 2 product lines on a website, and sending off these amounts will give me problems.


This is my first time ever that I've traded online, and I;m not sure whether this is normal in trade, I'm not sure what sort of relationships and agreements I should form.


Is it normal for a factory to expect full payment upfront?


Thanks


Tiger

Quoting from [TigerUK]:


I've bought a small batch of goods for £70GBP



I originally intended to spend £50, but after shipping and payment charges it rose to 70.




I'm happy with the products, and would like to trade with this partner.



However, the factory wants and expects full payment for all good (worth £450) from now on, before shipping off the goods.



This is going to be really bad for my cash flow, I'm a small independant retailer, who sells 2 product lines on a website, and sending off these amounts will give me problems.



This is my first time ever that I've traded online, and I;m not sure whether this is normal in trade, I'm not sure what sort of relationships and agreements I should form.



Is it normal for a factory to expect full payment upfront?



Thanks



Tiger

For small amount Yes, you have to think about they have to pay the bank every time they receive money, accountine Etc,

Medium amount normally 30% up front and 70% when the goods are ready,

Large amount L/C,

But you still have to consitter if you trust the seller 100%

 

 

Quoting from [MbM]:

Quoting from [TigerUK]:



I've bought a small batch of goods for £70GBP




I originally intended to spend £50, but after shipping and payment charges it rose to 70.





I'm happy with the products, and would like to trade with this partner.




However, the factory wants and expects full payment for all good (worth £450) from now on, before shipping off the goods.




This is going to be really bad for my cash flow, I'm a small independant retailer, who sells 2 product lines on a website, and sending off these amounts will give me problems.




This is my first time ever that I've traded online, and I;m not sure whether this is normal in trade, I'm not sure what sort of relationships and agreements I should form.




Is it normal for a factory to expect full payment upfront?




Thanks




Tiger

For small amount Yes, you have to think about they have to pay the bank every time they receive money, accountine Etc,

Medium amount normally 30% up front and 70% when the goods are ready,

Large amount L/C,

But you still have to consitter if you trust the seller 100%

 

 

I forgot to mention, I pay all bank charges.


Also what is a "medium amount",


Thanks


Tiger

Quoting from [TigerUK]:

Quoting from [MbM]:

Quoting from [TigerUK]:




I've bought a small batch of goods for £70GBP





I originally intended to spend £50, but after shipping and payment charges it rose to 70.






I'm happy with the products, and would like to trade with this partner.





However, the factory wants and expects full payment for all good (worth £450) from now on, before shipping off the goods.





This is going to be really bad for my cash flow, I'm a small independant retailer, who sells 2 product lines on a website, and sending off these amounts will give me problems.





This is my first time ever that I've traded online, and I;m not sure whether this is normal in trade, I'm not sure what sort of relationships and agreements I should form.





Is it normal for a factory to expect full payment upfront?





Thanks





Tiger

For small amount Yes, you have to think about they have to pay the bank every time they receive money, accountine Etc,

Medium amount normally 30% up front and 70% when the goods are ready,

Large amount L/C,

But you still have to consitter if you trust the seller 100%

 

 

I forgot to mention, I pay all bank charges.



Also what is a "medium amount",



Thanks



Tiger

That is hard to say, but in my world i would say 3000USD and up to 20K,

But I will inspect the goods before I send the rest 70%

Under or around 3000USD alone the banking fee can run up to 30USD or about 1% of the whole deal just to send the money,

But Alfa and Omega is to know who you are sending the money in the first place

 

 

Hi Mbm


Thank you again, for your helpful replies.


I speak to my chinese supplier every day on msn, as I am online a 3am in the mornings sometimes (in GMT).


The sample I received is perfect quality, and works fine.


However, am I being naive in thinking that I'm save and dealing with a trustworthy supplier? Should I still be doing more checks to verify this company?


Thanks


TigerUk

This is perfectly normal when trading in these small amounts.

Even large companies who place large orders have to pay up front for the first few trades until they build up a rapport with the supplier.

Ask yourself this question do you offer 30 or 60 day terms to your customers? especially a new customer?

From the sound of it your business is under capitalised. A common problem with UK businesses who have been brainwashed into using bank overdraft finance for their business or even worse credit cards.

Depending on your circumstances you might like to look at getting finance from either The Fredericks Foundation based at Lightwater in Surrey or the Prince's Trust (who have offices all over the UK), Both of these organisations specialise in lending to businesses that banks won't lend to. Which is typically the small business sector.


Hope this helps

Quoting from [TigerUK]:


I've bought a small batch of goods for £70GBP



I originally intended to spend £50, but after shipping and payment charges it rose to 70.




I'm happy with the products, and would like to trade with this partner.



However, the factory wants and expects full payment for all good (worth £450) from now on, before shipping off the goods.



This is going to be really bad for my cash flow, I'm a small independant retailer, who sells 2 product lines on a website, and sending off these amounts will give me problems.



This is my first time ever that I've traded online, and I;m not sure whether this is normal in trade, I'm not sure what sort of relationships and agreements I should form.



Is it normal for a factory to expect full payment upfront?



Thanks



Tiger

  in our china,As a new customer,for the first order, if the amount isn't large. we will use the payment  30up% deposit, 70%after see the copy B/L by fax. If the first amount is large we will use L/C.

 

Quoting from [TigerUK]:


I've bought a small batch of goods for £70GBP



I originally intended to spend £50, but after shipping and payment charges it rose to 70.




I'm happy with the products, and would like to trade with this partner.



However, the factory wants and expects full payment for all good (worth £450) from now on, before shipping off the goods.



This is going to be really bad for my cash flow, I'm a small independant retailer, who sells 2 product lines on a website, and sending off these amounts will give me problems.



This is my first time ever that I've traded online, and I;m not sure whether this is normal in trade, I'm not sure what sort of relationships and agreements I should form.



Is it normal for a factory to expect full payment upfront?



Thanks



Tiger

Hi,tiger

It is quite normal for your supplier to have such a payment term(100% before shippment).For me,i must receive this 100% advanced before production due to amount less than $2000-3000.You'd better try to give some finance support your business....

Good luck to you~~~

wendy

Quoting from [TigerUK]:


Hi Mbm



Thank you again, for your helpful replies.



I speak to my chinese supplier every day on msn, as I am online a 3am in the mornings sometimes (in GMT).



The sample I received is perfect quality, and works fine.



However, am I being naive in thinking that I'm save and dealing with a trustworthy supplier? Should I still be doing more checks to verify this company?



Thanks



TigerUk

I'm glad your first order arived in perfect quality but that is no reason to let down your gard, stay with this supplier if you are happy, it takes time to find a new one, but do not order more than you can affort to lose when you are ordering small quontaties and are paying 100% up front, when and if, you come in the positsion to order for a large amount later on, 30% advance and a preshipment control is advised,

Still keep an eye on the net, like google to se if any on complains against them, it is still money and things can change over night and even the best seller can start to cut quality to try to make more money

Quoting from [beginning of dream]:

Quoting from [TigerUK]:



I've bought a small batch of goods for £70GBP




I originally intended to spend £50, but after shipping and payment charges it rose to 70.





I'm happy with the products, and would like to trade with this partner.




However, the factory wants and expects full payment for all good (worth £450) from now on, before shipping off the goods.




This is going to be really bad for my cash flow, I'm a small independant retailer, who sells 2 product lines on a website, and sending off these amounts will give me problems.




This is my first time ever that I've traded online, and I;m not sure whether this is normal in trade, I'm not sure what sort of relationships and agreements I should form.




Is it normal for a factory to expect full payment upfront?




Thanks




Tiger

Hi,tiger

It is quite normal for your supplier to have such a payment term(100% before shippment).For me,i must receive this 100% advanced before production due to amount less than $2000-3000.You'd better try to give some finance support your business....

Good luck to you~~~

wendy

Hi Tiger,

It is normal in China. When we do business on line with our clients, we will begin to manufacture the products after receiving the deposit, and we will despatch the products after we receive all the money. You are lucky, you have met with a supplier who supplied you with the high quality products, I think that if have some problem in your capital, you can make a small order with that supplier for one time. If you have sincerity to cooperate with them, they will also despatch your goods on time. Or If you have no confidence, you can find some one in China to help you, you can ask that people to see whether that supplier is a real company. They are my idea. I hope that they can give you a little help.

 

Selina

Quoting from [TigerUK]:


I've bought a small batch of goods for £70GBP



I originally intended to spend £50, but after shipping and payment charges it rose to 70.




I'm happy with the products, and would like to trade with this partner.



However, the factory wants and expects full payment for all good (worth £450) from now on, before shipping off the goods.



This is going to be really bad for my cash flow, I'm a small independant retailer, who sells 2 product lines on a website, and sending off these amounts will give me problems.



This is my first time ever that I've traded online, and I;m not sure whether this is normal in trade, I'm not sure what sort of relationships and agreements I should form.



Is it normal for a factory to expect full payment upfront?



Thanks



Tiger

Read your artical's carefully...

In fact it's normal that they ask for full payment .

1)-450 Euro dollar is not big money ,if you transfer it at once ,it will save another time's bank charge .Normally in China ,every time it will cost at least 25 USD as bank charge ,so they will save a 25 USD for next time.-both it will save your bank charge as well .

2)-if you really have problem of the current flow ,you can explain to them and ask your bank to offer an guranty to them to ask them ship the cargo before payment..but for firstl business ,normally it's impossible for chinese supplier ..

 

Regards

 

Jane