Methods of Payment

Compared to selling in the domestic market, selling abroad can create extra problems. Delivery generally takes longer and payment for goods correspondingly can take more time. So exporters need to take extra care in ensuring that prospective customers are reliable payers and that payment is received as quickly as possible.

In the first and the last analysis, payment for exports depends on the conditions outlined in the commercial contract with a foreign buyer. As explained previously, there are internationally accepted terms designed to avoid confusion about cost and price.

I. Payment in advance.

Clearly the best possible method of payment for the exporter is payment in advance. Cash with order (CWO) avoids any risks on small orders with new buyers and may even be asked for before productions begin. However, this form of payment is extremely rare in exporting since it means that an overseas buyer is extending credit to an exporter – when the opposite procedure is the normal method of trade.

II. Open account.

An exporter receives the greatest security of payment from cash with order or from cash on delivery. At the other extreme payment on open account offers the least security to an exporter. The goods and accompanying documents are sent directly to an overseas buyer who was agreed to pay within a certain period after the invoice date – usually not more then 180 days. The buyer undertakes to remit money to the exporter by an agreed method.

The open account method of payment is increasingly popular within the EEC because it is simple and straightforward. 70 per cent of UK exports are paid for under open account terms. It saves money and procedural difficulties but the risk to the exporter is obviously greater. It is only successful if an exporter trusts the business integrity and ability of an overseas buyer.

A variation of open account payment is the consignment account where an exporter supplies an overseas buyer in order that stocks are built in quantities suffi-cient to cover continual demand. The exporter retains ownership of the goods until they are sold, or for an agreed period of time, after which the buyer remits the agreed price to the exporter.

However, a large proportion of export contracts cannot be settled by payment in advance or by open account, particularly with sales outside the EEC. So, parallel with the development of international trade throughout the world, the trading community has developed methods of payments which involve the transfer of documents for exported goods using the international banking system.

Приготовьте рассказ о Великобритании.

GREAT BRITAIN (THE U.K.)

The United Kingdom of Great Britain and Northern Ireland is a highly developed country. It is situated on the British Isles. The Territory of Great Britain is 244, 000 square kms. Great Britain consists of 4 parts: England, Wales, Scotland and Northern Ireland. The west coast of the country is washed by the Atlantic Ocean and the Irish Sea, the east coast is washed by the North Sea, Great Britain is separated from France by the English Channel. The capital of Great Britain is London.

The rivers of Great Britain are short. The Thames and the Severn are die most important. The climate of Great Britain is mild and damp. There are 204 rainy days a year in Great Britain.

The population of Great Britain is over 57 mln people, 81% (per cent) of the population are the Englishmen. The Scots, the Irish, the Welshmen and other nationalities also live in Great Britain. The national language is English.

Great Britain is a highly developed industrial country. The largest cities of Great Britain are: London, Birmingham, Glasgow, Liverpool, Manchester and Cardiff.

Great Britain is a parliamentary monarchy. Officially the head of the state is the king of the queen.

The highest legislative body in Great Britain is the British Parliament. It consists of two parts: the House of Commons and the House of Lords. The members of the House of Commons are elected, the members the House of Lords are not elected.

The highest executive body of Great Britain is the Cabinet of Ministers. The head of the Cabinet of Ministers in the Prime-Minister. The Prime-Minister is the leader of the Party which has won the election.

There are many political in Great Britain. The main parties are: the Conservative Party, the Labour Party, the Liberal Party and the Social-Democratic Party. The Conservative Party is the leading party now, because it has won the elections.

The Labour Party was founded in 1900. It numbers more than 6 mln members. Many trade-unions are collective members of this party.

The Liberal Party was founded in 1832. There are 300, 000 members in it. Both the Liberal Party and the Social-Democratic Party are not influential parties nowadays.

Ответьте на следующие вопросы:

1. Where is Great Britain situated?

2. How many parts does Great Britain consist of?

3. By what oceans and seas is Great Britain washed?

4. What is the territory of Great Britain?

5. What can you say about the climate of Great Britain?

6. What is the population of Great Britain?

7. What are the largest cities of Great Britain?

8. What is the highest legislative body in Great Britain?

9. What is the highest executive body in Great Britain?

10. How many political Parties are there in Great Britain?

11. What are the main political parties?

12. What is the leading party now?