What problems should we pay attention to when looking for an agent to export by ourselves?

In today’s society with rapid economic development, the foreign trade industry is a very popular industry, and its competitiveness is very strong; However, when choosing foreign trade companies to act as agents for export, it also has an impact on the development of foreign trade enterprises. Today, I will talk about the relevant contents of acting as agents for export, hoping to help you.

1、 Problems needing attention

1. You must first have your own foreign buyers, and the products you export comply with national laws and regulations and relevant policies.
2. You should ensure that the domestic businesses that provide you with goods have the general taxpayer qualification (that is, they can issue additional tickets), and you need additional tickets for finished products (usually the agent company does not accept additional tickets for noodles and accessories).
3. Try to choose an agent company with high local popularity, good reputation and many years of foreign trade agency (try to choose an agent company that is only engaged in “agency” export business, but does not do business by itself, so as to prevent the agent company from misappropriating your funds). It is strongly recommended that you learn more about the agency company you want to choose in the local foreign trade industry.
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   2、 Risks of export agency
4. Contract risk: the exporter of foreign trade fails to deliver goods in accordance with the contract or letter of credit. Delay in delivery due to the delay of production plant; Replace the products specified in the contract with products of the same specification; Deal at a low price and substitute inferior goods for good ones.
5. Risk of foreign exchange collection: although it is stipulated to settle foreign exchange by letter of credit and ship goods with quality in time, the documents submitted after shipment fail to comply with the documents. The documents are consistent, which makes the letter of credit play its due protective role. At this time, even if the buyer agreed to pay, he paid the expensive international communication fees and inconsistent deductions in vain, and the time of collection was greatly delayed, especially for contracts with small amounts, a loss would occur after 70% deduction and 20% discount.
6. Letter of credit risk: some letters of credit stipulate that the customer inspection certificate is one of the main documents for negotiation. The buyer will catch the seller’s eagerness to ship, deliberately picky, but at the same time put forward various payment methods to induce the enterprise to ship. After providing the buyer with the goods, the buyer is likely to deliberately inspect the inconsistency, delay the payment, or even empty the money and goods. The letter of Credit stipulates that the transport document expires within 7 working days after it is issued abroad. Whether it is the negotiating bank or the beneficiary, these terms cannot be guaranteed and must be carefully reviewed. If there is a trap clause, it should be timely notified to modify it. Don’t be greedy for an instant and lay hidden dangers for the future.
7. Operation and management risks: the export of foreign trade involves all aspects and is prone to problems. If the enterprise does not have perfect management methods, once a lawsuit occurs, it will cause a situation contrary to its wishes, especially those enterprises that pay attention to telephone contact. As the customer source of the enterprise is expanding every year, in order for the enterprise to be targeted in the transaction, it is necessary to establish business files for each customer, including credit and trade volume, and screen them every year to reduce business risks.
8. Operational risk: for foreign trade export business, the real practice of agency system is that the agent does not advance funds to the client, the profit and loss are borne by the client, and the agent only charges a certain agency fee. But in the real business operation, it is not the case. The first reason is that there are few customers and the ability to collect foreign exchange is poor, and we have to strive to complete the indicators; Second, if you want to make more money, you don’t think the agency fee is small.
9. Risk of payment method: delayed payment is a forward commercial payment method. If the exporter agrees to such a method, it is equivalent to providing financing preferences for the importer. Although the issuer voluntarily pays the deferred interest, on the surface, it only advances money for the exporter, and the loan is actually the quantity that the customer checks after the arrival of the goods. If the market changes, the importer can ask the bank to refuse to pay for the goods.