Your Pricing and Payment Policies, and those of your suppliers, have direct impacts on your costs and commercial risk. They represent Four Key Risks & Cost Factors:

  1. Foreign Exchange.
  2. Non-Payment.
  3. Payment Methods.
  4. Payment Terms.

To assist your considerations we have prepared the following:

  • Pricing Terms:
  1. Options for what is covered by the price you quote.
  2. For International Trade - higher costs can be incurred for: (a) insurance and (b) shipment - as well as for extra documentation, labelling & packaging plus tariffs, if any.
  3. Is your freight forwarder\carrier an Authorised Economic Operator? If not, you may incur extra expenses.
  4. Cargo Insurance Quotes.
  5. Cash or Credit?

The extra costs you may have to add depending upon the terms of the contract are:

  1. Cost of Delivery.
  2. Insurance.
  3. Import Taxes & Tariffs (Including possible deferment account fees).
  4. Extra Documentation.
  5. Finance & Foreign Exchange.
  6. Other "Incidental Costs" (You may have to pay for: Inspection, Health &\or Veterinary Certifications, Storage, Port Charges, Demurrage).
  • Foreign Exchange Considerations

If you enter into international contracts, there will be a foreign exchange consideration for either your company or your counterparty. To reduce the risks of uncertain exchange rates, you should look at forward exchange rate contracts - and look at closing the best foreign exchange rates available on the market.

  • Payment Terms
  1. Do you offer trade credit?
  2. Are you offered trade credit?
  3. Is there a discount for paying cash\early?
  • Payment Methods
  1. There are a variety of payment methods available. Each one has different costs and risk profiles. Check which ones are on offer and decide which ones best fit your situation.

For further information see: Reduce Risk: Pricing & Payments.