Terms for Shipping and Payment
Once you choose the company for China sourcing outsourcing, the next step is to finalize the terms and conditions of the business. The terms and conditions specify how the business will be executed later. Some of the main issues to take care of while setting these terms, are explained below:
Terms for Payment
If you choose a direct purchase for the China sourcing, you are asked to submit a Letter of Credit for payment purposes. Letters of Credit are documents that are prepared with the help of a bank that offers some kind of security to both the parties involved in the business. Fund transfer mostly takes place when the product you want to outsource is ready for shipment and once all the shipping documents are submitted to the bank. The only disadvantage is that it is a very lengthy and complicated process and it can bind your money for a long time. On the other hand, China sourcing outsourcing through third parties offer a comparatively better deal, as it provides support for negotiating the terms and conditions. The third party and the Import/Export Company of China share a good relationship with each other, and that is the main reason for providing best deals. For purpose of making payments of the purchases, the third parties are trusted a lot by the China sourcing companies. The terms and conditions in this case may have some clause for a part of payment, before shipping of the product and the balance payment of goods are checked for quality.
Terms of Shipment
At the end it is only the eventual buyer who has to pay for everything from shipping, insurance to brokerage and duty; the only difference being the person who lay out that money at different stages. Before setting the shipping terms make sure they are adequate and cost saving for both the parties.
Duty Payment
Being one of the 'most favored nations,' the duty in China sourcing is from 3 to 7 per cent product's custom class. However, duty payment can be delayed by blocking the goods under Foreign Trade Zone, thus saving the duty amount significantly.
Tootoo.com, the leading B2B platform, combining vertical search engine with value added service portal. It has more than 430 000 China quality suppliers and provides top quality B2B services to both sellers and buyers worldwide.
Article Source: ArticlesBase.com - Terms for Shipping and Payment