What
are the factors that typically affect the transaction cycle? Sourcing,
processing, transportation, shipping, documentation and payment period. Putting
days to each of these factors helps estimate how long it will take to execute
the transaction. This in turn influences the delivery period you agree to in
your contract with your buyers and your loan repayment period.
Assume
sourcing takes 14 days, processing- 4 days, transport to port city- 5 days,
shipping-14 days and documentation-3 days-,payment -5 days you could throw in
1-3 days for contingencies- these total 48 days.
This
clarity guides your decision making. Ignorance is not an excuse in exports-
understand the transaction cycle before signing that contract.
No comments:
Post a Comment