The first thing to do is to prepare for the transaction: including the target market, selecting target customers (screening potential customers by sending inquiries and information feedback); after selecting customers, establish customer relationships and then conduct substantive business negotiations, that is, enter the transaction negotiation and contract signing stage. The stages of transaction negotiation include: inquiry, quotation, counter-offer and acceptance.
The transaction is established when the two parties reach an agreement on the various trade conditions negotiated, and the contract is signed. All of the above work is mainly completed through the Internet. The next step is the third stage of work, that is, the performance of the contract. The work in this stage includes many business links, and the order of implementation of the work includes: stock preparation; implementation of letters of credit (under the letter of credit payment method); booking; document preparation and foreign exchange settlement. Some of the work in this stage is completed through the Internet.
Export contracts with other trade terms or using other modes of transportation involve roughly the same links as the above links. Due to the different trade terms used, the obligations and responsibilities of the seller and buyer of the transaction are different. For details, please refer to the discussion in Chapter 3.
The procedures of import trade in various business links in the transaction preparation stage and transaction negotiation stage are the same as those of export transactions. After the buyer and seller reach a sales agreement through negotiation, the responsibilities and obligations of the buyer and the seller are generally stipulated in the form of an export contract. After that, it enters the stage of contract performance. The performance of the export contract by one party means the performance of the import contract by the other party. The procedures for performing an import contract are opposite to those for performing an export contract, and the focus of work is also different. For example, if the transaction is concluded under FOB terms and payment by letter of credit, the buyer’s performance of the contract generally includes: opening a letter of credit, sending a ship to transport the goods, handling insurance, reviewing documents and paying, receiving the goods for customs declaration, inspection, and processing. The work of these links is completed by the import and export companies, transportation departments, commodity inspection departments, banks, insurance companies, and departments using goods, etc., with division of responsibilities and close cooperation.