外 贸 英 语 函 电 Business English Correspondence

1. 外　贸　英　语　函　电Business English Correspondence 主编　项伟峰

2. Content Structure Job Competency • Learning Goals Job task • Learning Task 1 Job task • Learning Task 2 Exercises • Module Assessment Summary • Module Conclusion

3. Module Five Payment 1 Learning Goals (Job competency) 2 Learning Task 1 3 Learning Task 2 4 Module Assessment 5 Module Conclusion

4. Learning Goals • Get familiar with time of payment and different method of payment • Negotiate the suitable payment terms with the counterpart. • Request amendment on payment method • Respond to modified payment terms

5. Module Five Payment 1 Learning Goals (Job competency) 2 Learning Task 1 3 Learning Task 2 4 Module Assessment 5 Module Conclusion

6. Learning Task 1 Negotiate terms of payment Section 1 Lead in Section 2 Business Compass Section 3 Work Samples and Analysis Section 4 Core Phrases and Sentence Patterns Section 5 Simulation Workshop Section 6 Summary

7. Lead in Discussion: • 1. What are sellers and buyers concerned about in negotiating payment terms? • 2. Which method of payment do you prefer if you are the exporter? and which one if you are the importer?

8. Keys 1. Both parties want assurance that the deal will be completed successfully. The exporter would like to be paid for his goods as early as possible, but for the importer, he would like to postpone payment until he sees the goods and makes sure it is what he wants. 2. For the exports, payment in advance by TT and L/C are more secure; For importers, payment after delivery or by D/P or D/A are preferable.

9. Learning Task 1 Negotiate terms of payment Section 1 Lead in Section 2 Business Compass Section 3 Work Samples and Analysis Section 4 Core Phrases and Sentence Patterns Section 5 Simulation Workshop Section 6 Summary

10. 1.1 Time of payment Four types of payment method: • Prepayment; Payment Prior to Delivery 交货前付款　 • Payment Against Delivery交货时付款(includes CAD, D/P at sight and L/C) • Payment after Delivery/deferred payment 交货后付款(includes open account, consignment and D/A) • Installments 分期付款

11. 1.1 Time of payment

12. 1.2 Method of Payment Key factors for choosing method of payment: • trust between buyers and sellers （买卖双方互信程度） • bank involvement (银行介入的程度)

13. 1.2 Method of Payment • Direct settlement and payment (买卖双方直接清偿及付款) • Collection (托收) • Letter of Credit (信用证)

14. 1.2.1 Direct settlement and payment • PREPAID/PREPAYMENT/ADVANCEPAYMENT • Cash With Order(CWO) 订货付款 • CASH IN ADVANCE(CIA)/ PAYMENT IN ADVANCE(PIA) 预付货款

15. 1.2.1 Direct settlement and payment • CASH AGAINST DOCUMENTS (CAD) (交单据时付款） • CASH ON DELIVERY/COLLECT ON DELIVERY(交货付款)

16. 1.2.1 Direct settlement and payment • CONSIGNMENT寄售 • OPEN ACCOUNT 货到后，先记账，过段时间再付款以结账

17. 1.2.1 Direct settlement and payment • INSTALLMENT/Progressive Payment • BANK TRANSFER –REMITTANCE BY T/T, M/T OR D/D (by SWIFT)

18. 1.2.2 Documentary Collections • Documents against payment (D/P), the documents attached to the draft needed to obtain goods are available only after payment of the draft. • Documents against acceptance (D/A), the documents attached to the draft needed to obtain goods are available only after acceptance of the draft. D/A applies to a time draft.

19. 1.2.2 Documentary Collections

20. 1.2.3 Documentary Letter of Credit A documentary letter of credit is a conditional guarantee of payment in which an overseas bank takes responsibility for paying you after you ship your goods, provided you present all the required documents such as documents of title, insurance policies, commercial invoices and regulatory documents. (Detailed explanation of L/C will be learned in Module 6.)

21. 1.3 Invoices and Pro-forma Invoices • A commercial invoice issued by the seller which gives a description of the goods, prices, terms exactly as specified in the sales contract. • A pro-forma invoice is an invoice with the words pro-forma typed or stamped on it, prepared by the exporter and required in advance by the importer chiefly for information, import license or letter of credit purposes.

22. ② 出票人 Drawer 收款人 Payee ① ③ 受票人（付款人） Drawee（Payer） 1.4 Instrument of Payment • BILL OF EXCHANGE

23. 1.4 Instrument of Payment • BILL OF EXCHANGE

24. ①出票 出票人/ 付款人 Maker 收款人 Payee ②收款 1.4 Instrument of Payment • PROMISSORY NOTE

25. 1.4 Instrument of Payment • CHEQUE/CHECK Cheque for US$2,658.00 London,20 Nov.,2011 Pay to the order of China National Textile Corp. The sum of US DOLLARS TWO THOUSAND SIX HUNDRED AND FIFTY EIGHT ONLY To National Westmister Bank, London,England For ABC Trade Co. signed

26. 1.5 How to choose terms of payment Key factors to determinepayment method: • business relationship; • nature of the merchandise; • industry norms; • distance; • potential risk for currency fluctuation; • political and economic stability.

27. Example of Payment Terms: • Payment shall be made Cash With Order by means of T/T or M/T.（订货时以电汇或信汇付现款。） • Net CAD (Cash Against Documents) payable in New York. (凭单证在纽约付现金。) • Payment shall be made by check when the goods have been sold.（货物一经出售，应以支票付款。） • Payment shall be effected by T/T or M/T immediately after sale of goods.（货物销售后，应即以电汇或信汇方式支付货款。）

28. Example of Payment Terms: • By O/A basis, payment to be made within 60 days after B/L date.(记账，提单签发日期后60天内付款) • Payment by L/C draft at 60 days after sight（凭信用证下所开汇票见票后60天付款。） • Payment by sight bill, documents against payment.（凭即期汇票付款，付款交单。） • Payment by 60 days sight bill，documents against payment．（凭见票后六十天付款之汇票付款，付款交单。） • Payment by 180 days date bill，documents against acceptance.（凭见票后180天付款之汇票付款，承兑交单。）

29. Combination of payment methods • 70% at sight L/C, 30% T/T（or 80% L/C, 20% T/T, the portion can be negotiated） • 30% T/T as down-payment, 70% T/T before shipment. • 30% T/T upon order confirmation(down-payment)，70% L/C at 60 days. • 50% T/T before shipment，50% T/T after shipment（or 50% T/T 30 days after B/L date）

30. Combination of payment methods • 30%T/TPrepayed and the balance against B/L copy • 30% T/T as down-payment, 70% D/P. • 50% T/T as down-payment，30% T/T 30 days after B/L date，20% T/T 60 days after B/L date

31. 1.6 Writing guide Propose payment terms: • Referring to the relative order or contract. • Putting forward favorable payment terms or your usual practice. • Stating the reasons. • Expecting acceptance.

32. 1.6 Writing guide Respond to proposal of payment terms: • Refer to the other party’s letter. • Express agreement or disagreement to his requirement. • State the reasons. • Express your proposal or insist on your usual practice, if you disagree.

33. Learning Task 1 Negotiate terms of payment Section 1 Lead in Section 2 Business Compass Section 3 Work Samples and Analysis Section 4 Core Phrases and Sentence Patterns Section 5 Simulation Workshop Section 6 Summary

34. Letter 1 Propose payment by T/T Dear Mr. Pradabtanakij: Thank you for your interest in Exotic Textiles. We are very pleased to begin our mutually profitable partnership. Our policy with new customers is to require a 50% payment in advance for all shipments, preferably via wire transfer. (We can also accept credit card payments by phone or fax.) The remaining 50% is due within 10 days of delivery. Enclosed you will find all the account details you will need for a wire transfer. We look forward to receiving your first order. Yours faithfully, Malika Karmarkar, Malika Karmarkar, Sales Manager Exotic Textiless，New Delhi

35. Letter 1 Propose payment by T/T Comments: • The letter lays out the agreed payment terms briefly but clearly. Analysis: • Para.1 Thank the customer for interest. • Para.2 State the terms of payment • Para.3 Detail the enclosures and expectation • Enclosure: account detailsy.

36. Letter 2 Payment by D/P at sight Dear Mr. Lindquvst, We have made up your order, No. 8540, which is now aboard the SS Leda which sails for Copenhagen on 11 June. We are sure you will be pleased with the selection of items that we were able to get from stock. As there was no time to check references, we have drawn a sight draft which will be sent to Nordbank, Garnes Vej, Copenhagen, and will be presented to you with the documents for payment. If you can supply two references before placing your next order, we will put the transaction on a document against acceptance basis with payment 30 days after sight. Yours sincerely, D.Panton D.Panton Managing Director

37. Letter 2 Payment by D/P at sight Comments: • The letter contains all the necessary information about payment. The tone is friendly, assuring the customer of shipment and suggesting D/A after 30 days sight acceptable in next order if two references were provided. Analysis: • Para.1 Give details of shipment. • Para.2 State confidentially of the goods and explain D/P at sight is used • Para.3 State D/A after 30 days sight acceptable if references provided.

38. Letter 3 Buyer proposes payment by D/A Dear Mr. Lee: We wish to place with you a trial order for 150 cases of 4 Canned Luncheon Meat at your price of US$ 300 per case CFR Kuwait for shipment during October/November. As this particular order involves a relatively small amount and we have only moderate means at hand, we would suggest payment by D/A at 60 days’ sight. If the trial sale proves successful, you may count on us for further orders. We hope you can give our proposal your most favorable consideration and await your early reply. Truly yours, Henry Harrison Henry Harrison

39. Letter 3 Buyer proposes payment by D/A Comments: • The writer wishes to place the order and accept the price terms except payment method and proposes payment by D/A at 60 d/s. The language is concise and clear. Analysis: • Para.1 Wish to place the order and confirm the price terms. • Para.2 Propose payment by D/A at 60 d/s • Para.3 Expectation

40. Letter 4 Negotiate payment by L/C Dear Sirs Thank you for your order No.908 for 50 metric tons of Peanut, but we regret being unable to accept your terms of payment, 50% by L/C at 30 days sight, the balance 50% by D/P at sight. The specimen contract we sent you last time indicates clearly that our usual terms of payment are by confirmed, irrevocable, divisible, revolving and transferable letter of credit in our favor, available by draft at sight, reaching us at least 30 days ahead of shipment and remaining valid for negotiation at our counter till the 15th day after the final date of bill of lading, and permitting transshipment and partial shipments.

41. Letter 4 Negotiate payment by L/C We also mentioned in our letter on 10 July that several big British firms had already done business with us on the above terms basis. We hope you would agree with us on payment terms so as to get the initial transaction through. As soon as we get your confirmation, we will airmail you the contract for counter-signature. We are looking forward to your favorable reply. Yours faithfully David Wang David Wang

42. Letter 4 Negotiate payment by L/C Comments: • This is a polite rejection of the proposal for other payment terms. It gives good reasons for not agreeing to the proposal. The tone of the letter is unlikely to antagonize the customer. Analysis: • Para.1 Identify the reference and reject the proposal politely. • Para.2 Make it clear that terms of payment by L/C • Para.3 Give confidentiality from your point of view and urge acceptance of payment terms. • Para.4 Instructions on what action is to be taken • Para.5 Expectation.

43. Letter 5 Confirm Payment by L/C Dear Mr. Lee, Thank you for your letter of 15 April regarding payment terms. We agree to your proposal, the terms of which are as follows. Payment will be by confirmed, irrevocable letter of credit with draft at sight The price quoted to us is with no discount. The above payment terms have been approved by our Managing Director and will be acted on accordingly. The order is being prepared and will reach you in the next ten days.

44. Letter 5 Confirm Payment by L/C I would like to take this opportunity to inform you that our representative, Mr. John Green, will attend the forthcoming Canton Fair. He will be writing to you shortly. We sincerely hope that future discussions between our companies will lead to further mutually beneficial business. Yours sincerely, Denis Thorpe Denis Thorpe Manager

45. Letter 5 Confirm Payment by L/C Comments: • The letter lays out the agreed payment terms briefly but clearly. The fact that a personal contact will be arranged indicates that the purchaser intends to cement the business relationship. Analysis: • Para. 1 Make the reference clear. • Para. 2 State the payment terms. • Para. 3 Indicate when the order will be placed. • Para.4 Add any further relevant information. • Para.5 Complete the letter with a friendly message

46. Letter 6 Request modified payment terms from L/C to T/T Dear Sirs, We enclose our Order No. 463. We have examined the specifications and price list for your range of ceramic files and now wish to place on order with you. As we are in urgent need of new stock, we would be grateful if you would make up the order and ship it as soon as possible. In the past we have traded with you on a sight credit basis. We would now like to propose a different arrangement. When the goods are ready for shipment and the freight space booked, you telex us and we then remit the full amount by telegraphic transfer (T/T).

47. Letter 6 Request modified payment terms from L/C to T/T We are asking for this concession so that we can give our customers a specific delivery date and also save the expense of opening a letter of credit. As we believe that this arrangement should make little difference to you, but should help our sales; we trust that you will agree of our request. We look forward to receiving confirmation of our order and your agreement to the new arrangements for payment. Yours faithfully, Theresa Andrews Theresa Andrews Manager

48. Letter 6 Request modified payment terms from L/C to T/T Comments: • The letter politely requests modified payment terms. The reasons given for the request are logical. Since the vendor will not be at risk, it is very likely that the proposal will be accepted. Telegraphic transfer is a completely secure method of payment. Analysis: • Para. 1 Identify the reference. • Para. 2 Urge quick delivery, giving the reasons. • Para. 3 State the modified payment terms requested. • Para. 4 Give the reasons for requesting the modified payment terms. • Para. 5 Urge acceptance of the proposal.

49. Letter 7 Agree to modified payment terms from L/C to T/T Dear Ms. Andrews, Thank you for your letter of 6 June and your Order No. 463 of the same date for ceramic tiles. We are pleased to accept the modified payment terms. A telex has been dispatched to you about this. All the items in your order can be supplied from stock and will be packed and shipped immediately your remittance by telegraphic transfer is received.

50. Letter 7 Agree to modified payment terms from L/C to T/T We will airmail you the following documents immediately after shipment: Bill of lading in duplicate; Invoice, CIF London, in triplicate; Insurance policy for 110% of invoice value; Guarantee of quality. We will, of course, notify you by telex as soon as your order is shipped. Yours sincerely, Marco Grassi Marco Grassi