Export Sales - Get Paid

Today on the International Trade Resources Podcast, our host Kim Kirkendall is joined by Olivier Brusle, CEO of ACTIOM, a professional services firm, to discuss some of the challenges companies have getting paid regarding export sales. Olivier has over 35 years of industry, entrepreneurship, and consulting experience and is an expert in optimizing commercial transitions and B2B Sales. 

First Olivier discusses some of the key reasons for payment delays in international trade - starting with delivery issues such as logistics delays, customs clearance problems, and packaging issues. Another common reason payments are delayed is administrative challenges arising from the complex process of international trade. Kim mentions additional customer-related issues such as fraudulent behavior, the customer’s cash flow problems, or disputes over product quality and more as factors in payment delay.

To mitigate these risks, it is crucial to take steps in advance of the sale. Amongst other things, Olivier mentions your company should conduct credit risk assessments to identify secure funding options along with other steps to take early in the transaction process. Kim and Olivier discuss what companies should include in their sale contracts, listing quite a few ideas to help safeguard against these risks.

Next, Olivier dives into common trade instruments like letters of credit and documentary collections. Credit insurance can cover risks not typically addressed by other instruments, such as bankruptcy or political risks. Additionally, Kim and Olivier talk about considering supply chain finance and factoring, which can help address cash flow issues and ensure timely payments.

Lastly, Olivier and Kim break down the importance of understanding and ensuring clarity on the buyer’s internal payment processes and requirements that can help avoid delays. They describe how open discussions with buyers can foster trust and collaboration. With a highlight being how to identify the customers ongoing supply chain receipts (listen for this nugget). Olivier also mentions other measures to safeguard the goods to further secure payments and mitigate risks.

Listen now and learn about the importance of preparation, leveraging financial instruments, utilizing technology, and maintaining clear communication to ensure successful international trade transactions.

KEY TAKEAWAYS:

• How payment delays can arise from many factors.
• How to identify risks and draft contracts to limit payment problems.
• How to develop open discussions with buyers about payment processes and their ongoing supply chain and receipts of funds.

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