Our company is a chemical company established two years ago with a registered capital of 20 million yuan. Recently, our business has developed rapidly and has established business links with some international companies. When negotiating with a famous Japanese trading company, Japanese customers suggested that although they had confidence in our ability to execute contracts, they could not immediately give us such a large order.
According to their company’s system, the registered capital of our company cannot reach the minimum of the transaction with them, and the amount of this order is large. But they suggested that we can export through a large international trading company in Shanghai. This company has abundant registered capital and has accumulated good trade credit on the Japanese company. It’s possible to deal with this order through them. I don’t understand these complex relationships. We can export by ourselves. Why should we make use of the platforms of other foreign trade companies?
Some large Japanese companies, such as Mitsui and Mitsubishi, not only focus on low prices when choosing partners. For them, the reliability is also important. Therefore, when they choose partners, they are generally not willing to let new suppliers enter their systems. But once suppliers enter, cooperation will last long. They care about the qualification of the enterprise, such as the certification system, credit status, registered capital, bank loans, business reputation, etc. They will only choose enterprises that fully meet their requirements as partners.
For large orders, they require that the registration amount of the other party must be higher than the order amount to ensure security. Moreover, the credit of new suppliers also has a cumulative process. For example, the number of orders in the first year should not exceed $3 million. After 2~3 years, the annual order quantity can reach the amount of 20 million US dollars. They control the risk by controlling the quantity and amount of orders.
If they think some suppliers are good, but unwilling to violate the company’s rules, they may take an approach. That approach is to bring in a middleman who has long and good cooperation with them. Although the cost will increase through the middleman, the Japanese buyer will have more assurance and less risk. Even if there are some difficulties in the execution of this contract, the large domestic trading company will have a better effect of negotiating directly with the supplier than with Japanese customers. If the new partner does not perform well through cooperation, he will not enter the scope of the official supplier. But if he does well, the client will consider a direct deal when the opportunity matures.
For the involving foreign trade company, there is a lot of business with the Japanese trading company. It is not bad to add some businesses this time. Of course, it also takes some risks. It is just that it tries to pass the risk on to the suppliers.
Sometimes, customers place large orders to suppliers through foreign trade companies, while small orders directly to suppliers. In this way, it does not affect the execution of large orders. Meanwhile, suppliers can also slowly accumulate credit and have plenty of time to increase capital to their business license.
I have also made some agency contracts. Some international companies are more demanding for direct contracting suppliers. Therefore, they will even find some suppliers and talk directly about the price with them. Then they gave the order to our company and indicated the supplier on order. After receiving the order, we will sign the export agency agreement with the supplier. I generally do not participate in technical matters, mainly involving in contract execution, shipping, foreign exchange collection, payment, etc.
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4. How Do Novices Prepare for Interviews?
5. How to Choose the Right Foreign Trade Position?
6. Are Girls Suitable for Foreign Trade Sales?
7. Do Exports of Traditional Industries Have Development Space?
8. Is Foreign Trade Newcomer’s Income Generally Low?
9. How to Adapt to Foreign Trade Posts Asap?
10. How to Improve English Ability in the Short Term?
11. How Can Newcomers Better Communicate with the Leaders?
12. How to Get the Client’s Trust in the Short Term?
13. What Should I Do if I Have A Dispute with the Client?
14. How to Adjust Attitudes When Meeting Differences in Company?
15. How to Communicate with Foreign Customers?
16. What Should I Do if the Company is Filled with Intrigue?
17. What Reference Books Should Foreign Trade Newcomers Read?
18. How to Make Yourself Look More Professional?
19. How to Adjust Mentality When You Switch to Foreign Trade?
20. How Does the Salesclerk Calculate the Gross Profit?
21. How to Calculate the Export Tax Rebate?
22. How do Newcomers Develop Market Based on its Features?
23. How to Calculate the Export Cost Price?
24. How to Fill in the Vendor Registration Form?
25. What is the Format of A Letter of Authority?
26. How to Attract Potential Customers in the Exhibition?
27. The Main Features of Reverse Auction and the Skills to Attend It
28. The Experience of Attending A Reverse Auction
29. Why Don’t Place Orders for Good Price and Products?
30. What if Customers Require Not to Supply to Its Competitors?
31. Can You Really Buy Real Buyer Information?
32. How to Make A Standardized Quotation?
33. How to Prepare for Customers to Visit Our Factory?
34. How Should We Arrange for the Visit of Executive Clients?
35. How to Prepare for the Quality Inspection?
36. What Should Be Noted When Eating Food with Customers?
37. How to Work as A Good Banquet Translator?
38. How to Reasonably Arrange the Time When Customers Visit?
39. How to Prepare for Visiting Clients Abroad?
40. How to Make the Minutes of the Meeting?
41. What If Clients Propose to Sign Exclusive Sales Agreements?
42. Is the Cost of the Hotel Paid by Customers or Us When Visiting?
43. Can Subcontractor Warranty be Provided to End-users?
44. What If the Customer Suddenly Does Not Want the Goods?
45. Suppliers Lost Chances for Backing Up on the Highway
46. How to Maximize Profit through Reasonable Price Strategy
47. How Should Foreign Trade Companies Find their Position?
48. How Do Foreign Trade Companies Choose Export Suppliers?
49. How to Enhance the Control and Influence over Suppliers?
50. Is It Proper to Let Clients Ask Manufacturers to Solve Problems?
51. How to Agent Domestic Factories to Export Their Products?
52. Which Way to Pay the Agency Fee is better?
53. Why Do You Have to Know about Products, Suppliers, Clients?
54. The Process and Cost Calculation of Agent Import Business
55. How to Straighten Out Relationships in the Agency Contract?
56. How Do We Show That We Need An Agent in the Contract?
57. How to Do Good Jobs of Agency Import Agreement Service?
58. How to Determine A Reasonable Agency Fee?
59. Is the Agency Business with Low Agency Fees Worth Doing?
60. Why Do Manufacturers with Foreign Trade Rights Want Agents?
61. How to Use Foreign Trade Company to Open Overseas Market?
62. What are the Difficulties in Collecting Money by Letter of Credit?
63. If Supply Cycle is Long, How to Control the Risk of Quotation?
64. What if Tax Rebate Policy Cause Prices Lower Than Costs?
65. Tips for Paying Commissions to Foreign Middlemen or Agents
66. Why Use Written Documents for Business Contacts?
67. How to Control the Risk of Export Quotes?
68. How to Trade in the Middle East While Controlling Risks?
69. How to Offer the CIF Price to Products with Long Supply Cycle?
70. The Main Situation of Foreign Trade Fraud
71. How to Handle Costs of Repacking Goods at Destination Port?
72. What If the Qualified Products Aren’t Enough to the Contract?
73. How to Handle the Return or Repair of Exported Goods?
74. What Should I Do with Insubstantial Complaints from Clients?
75. How to Handle Disputes in the Agent Export Contract?
76. What If Clients Ask Us to Replenish or Repair Products?
77. What if Clients Demand Compensation for Packing Damage?
78. Parts of Previous Goods Rusted, Clients Ask to Replenish Freely
79. Who Should Bear Import Tariff and VAT for Free Replenishment?
80. What If the Goods Deformed the Container Before Shipment?
81. What If Customers Threaten to Punish Us for Quality Problems?
82. Why Do Customers Never Feed Back on Our Quality?
83. What If Customers Ask Compensation for Damaged Products?
84. What If the Forwarder Delay Delivery, Bringing Extra Costs?
85. What If Customers Have Placed Orders with Wrong Quotes?