Hong Kong order

Re: [spiers] Hong Kong order


In a message dated 3/12/04 9:23:18 AM, tiananmentrading@aol.com writes:

<< I'm about to place an order for baby garments in Hong Kong that I designed
(thanks to you I changed from "off the shelf" to my own concept).

***Congratulations! And you have the orders in hand to cover the supplier's
minimum production run?***

What is the
best payment terms? I have been working with the manufacturer for 1 1/2 years
and trust them but don't want to lose my shirt on some amateur mistake.

***If they haven't mentioned any, then best bet is visa mastercard. This is
not so strage, in fact Visa is working on the software to securely handle
transactions up to a $10 million by credit cards, for biz purposes (think of the
frequent flier miles!)

There are issues here, you personal card explicitly prohibits you using the
card for biz purposes... and the point of using visa mastercard is for the
security, and if you have a problem Visa/MC may not help you since you "abused"
your card.

The supplier may require you add say 2% to the invoice value to cover what
Visa/MC charges the supplier.

Assuming the value of the shipment is some $7000, and your card limit is
$5000 (I assume you all clear out your credit card balances each
month...ahem...),
then you'll need to mail in an extra $2000 to visa before the deal to create
a $5000 + $2000 = $7000 credit cover the transaction.

Anything less than $5000 should be under some special arrangement...over
that, normally a letter of credit is required.

(And after the last post regarding "checking credit on letters of credit" I
hope I made clear the EVERYONE gets checked by the banks under the rules, not
that anyone being checked is any sort of suspect.)***

How would you recommend proceeding? 1/3 down at production, 1/3 at time of
shipping and 1/3 at receipt of shipment? What else to watch out for? I know
you
have years of experience here. Please advise! >>

***Above about $5000, letter of credit, below that, visa/master card. If not
workable, keep in mind that he supplier is making maybe 10% on the deal, so
you 66% by the time he ships is still quite a risk for him. But ask him what
works.

Also, think this thru... planning a trip...? Can you tie in the delivery to
the docks overseas with you being there? Watch the goods boxed... see them
loaded, pay the supplier cash?

See what the supplier says...

John

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