Unit 7 Payment and Settlement
of accounts
1,Terms of payment
(1) Remittance
? ---T/T (Telegraphic Transfer)
? ---M/T (Mail Transfer)
? ---D/D (Demand Draft)
(2) Collection
? ----D/P (Document against Payment)
? ----D/A (Document against Acceptance)
(3) Letter of Credit
----What is L/C?
----Types of L/C
Documentary L/C; Irrevocable L/C; Confirmed;
Sight/Usance; Transferable; Revolving;
Reciprocal; Back to Back; anticipatory; Standby;
----Parties in the L/C
1.contract
5.shipment
2 8 4 6
3
7
applicant
Issuing bank advising bank
/negotiating
beneficiary
Paying bank
2.Procedure of the L/C
? Application Form;
? Advising the beneficiary;
? Examination of the L/C;
? (Amendment of L/C)
? Complementing the contract;
? Presenting the documents under the L/C;
? Negotiating or Paying for the L/C;
3,Objectives in L/C business
(1)Exporter urges importer to open a L/C;
(2)Importer notices seller for the L/C;
(3)Amendment of L/C;
(4)Dispute arise in dealing with the L/C;
4.specimen letters-1
(1) Exporter urges importer to establish a letter
of credit
? We regret to inform you that there has been no
news from you at all about your letter of credit,
which should have reached us before Sept,9th,
2002,This has caused us much inconvenience,
since we have already made preparations for
shipment according to our Sales Confirmation
No.4.
? You may recall that the same thing happened
to the execution of our last contract,It was
only after the market had turned for the
better that you opened the covering L/C,
quite beyond the time limit,We should have
refused then to effect shipment,but we
acceded to your request for fulfillment of
your order,At the same time we pointed out
that you should take effective measures to
prevent a similar occurrence.
? This article,as you know,has met with great
popularity since offered for sale,and new orders
have nearly exhausted our stock,But considering
our long-term business relationship we are still
holding the goods for you,
? We hope that you will lay great store on your
credit standing this time and establish the
relevant L/C before Oct,9th,2002.
? Please not that unless the L/C reaches us
before the suggested time,we shall have no
alternative but to cancel the contract and will
not enter into any more transactions with
you next year,We regret this decision,but of
course we are in on way to blame,
? We are looking forward to your letter of
credit.
Specimen letter-2:(2)Amending the L/C
Dear sirs,
? We have received your L/C No.xx,but regret to find
that there are certain points that do not agree with the
terms of our Sales Confirmation No,xx.
? 1.Our S/C No,xx emphasized that your letter of credit
shall allow transshipment,but the Credit states:
“transshipment prohibited”;
? 2,Your Credit calls for shipment in two equal
monthly lots during June/July,2002,whereas it is
explicitly stipulated in the S/C that shipment is to be
made in a single lot not later than July 31,2002.
? 3.There is no word,about” before the
quantity and amount in the L/C,although the
word is clearly used before them in our S/C.
? 4.Your L/C stipulates for the goods in an
assortment of Types A,B,C,20%,40%,
40% RESPECTIVELY,But the assortment
contracted for is,Types A 30%,B 30%,
and C 40%,
? You are requested to make the necessary amendments,
as the shipment is conditional upon the conformity of
the L/C with our Sales Confirmation.
? We hope that in future you will establish your letters of
credit exactly according to the terms and conditions of
relevant sales confirmation,or include in them such
terms as,AS PER S/C No…,”,By so doing you will
not only save much trouble,but also help to facilitate
shipment of your products.
? We are awaiting your bank’s credit amendment,
5,useful expressions
? (1) Our terms of payment are by confirmed,
irrevocable letter of credit in our favor,
available by draft at sight,reaching us one
month ahead of shipment,remaining valid for
negotiation in China for another 21 days after
the prescribed time of shipment,and allowing
transshipment and partial shipments.
? (2) In view of the small amount of this
transaction,we are prepared to accept payment
by D/P at sight (or at 30 days’ sight) for the
value of the goods shipped.
? (3) In compliance with your request,we will
make an exception to our rules and accept
delivery against D/P at sight,but this should
not be regarded as a precedent.
? (4) We regret having to inform you that
although it is our desire to pave the way for
a smooth development of business between
us,we cannot accept payment by D/A,
? (5) We regret our inability to make any arrangement
contrary to our usual practice,which is payment by
confirmed,irrevocable letter of credit payable against
presentation of shipping documents and valid for at
least 15 days beyond the promised date of shipment.
? (6) We wish to draw your attention to the fact that as
a special sign of encouragement,we shall consider
accepting payment by D/P during this sales-pushing
stage,We trust this will greatly facilitate your efforts
in sales,and we await your favorable reply.
? (7) Payment is to be made against sight draft drawn
under a confirmed,irrevocable letter credit without
recourse for the full amount of purchase,
Unit 8 Complaint and Adjustment
? 1,Complaint made by buyer—genuine complaint
? Non-delivery;
? Shortage supply/shortweight;
? Defective goods/poor quality;
? Poor package;
? Leakage;
? -----complaint made by buyer who find fault with the
goods as an excuse to escape from their contract;
2.Plan your letter
? Begin by regretting the need to complain;
? Mention the details of the goods complained about;
? State your reasons for being dissatisfied and ask for
an explanation;
? Refer to the inconvenience caused;
? Suggest how the matter should be put right;
3,Lodging a claim
? (1) If you have anything to complaint about,
make your claim at once;
? (2) Be sure the claim is accurate and
reasonable,and before you write a letter about
it gather all of the information that you can;
? (3) Avoid discourteous statements such as,I
demand,”,you will have to”,and,why can’t
you,” because they only offend the reader and
lessen the likelihood of your obtaining the best
possible adjustment.
4,The tone of the claim letter
Anger tone:
It was certainly carelessness on your part
to send me,Forever” brand bicycles
when I asked for,Phoenix” brand,I
simply do not understand……
Mile tone:
Today I received a consignment of 200
“Forever”
brand bicycles instead of,Phoenix” brand
specified in my order of May 23.
Adjustment
Slogan,Settle the problem and keep the customer!
1,Reply promptly;
2,Show understanding;
Apologetic,We are sorry for our late shipment.
Conciliatory:We are indeed sorry to learn of your
disappointment in not receiving our shipment.
3,Be tactful;
Negative,We have your letter about the alleged
loss of two cases of your consignment.
Positive,We are sorry to learn about the loss of
two cases of your consignment.
Negative,If what you say is true,we suppose
we will have to replace the damaged pens.
Positive,Please rest assured that we’ll replace
the damaged pens.
Correct the following sentences:
1,The wrong delivery of the goods resulted in our
careless handling your order.
2,Fifteen trays entered on the invoice,but there
are only twelve in the case.
3,Please let us know if we shall return the wrong
goods to you or keep them in the warehouse
for your disposal.
4,To our surprise,there are instead of only 20
cans in the Box No,3 not 24 as stipulated.
5,Since the goods delivered are below those of
the sample you sent us,we have return them at
you expense.
6,Much to our regret,we could not persuade our
clients accepting your goods of so poor quality.
7.The damages of the goods are not to be liable by us as
we have evidence enough that they occurred during
transit.
8,Since the sales contract is included an arbitration
clause,we might as well settle the dispute among our
two parties by arbitration.
9,We are supposed that you have made a mistake of
marking in which resulted our receiving the wrong
goods.
10.we are sorry to report 3 package short of Case No,20
of accounts
1,Terms of payment
(1) Remittance
? ---T/T (Telegraphic Transfer)
? ---M/T (Mail Transfer)
? ---D/D (Demand Draft)
(2) Collection
? ----D/P (Document against Payment)
? ----D/A (Document against Acceptance)
(3) Letter of Credit
----What is L/C?
----Types of L/C
Documentary L/C; Irrevocable L/C; Confirmed;
Sight/Usance; Transferable; Revolving;
Reciprocal; Back to Back; anticipatory; Standby;
----Parties in the L/C
1.contract
5.shipment
2 8 4 6
3
7
applicant
Issuing bank advising bank
/negotiating
beneficiary
Paying bank
2.Procedure of the L/C
? Application Form;
? Advising the beneficiary;
? Examination of the L/C;
? (Amendment of L/C)
? Complementing the contract;
? Presenting the documents under the L/C;
? Negotiating or Paying for the L/C;
3,Objectives in L/C business
(1)Exporter urges importer to open a L/C;
(2)Importer notices seller for the L/C;
(3)Amendment of L/C;
(4)Dispute arise in dealing with the L/C;
4.specimen letters-1
(1) Exporter urges importer to establish a letter
of credit
? We regret to inform you that there has been no
news from you at all about your letter of credit,
which should have reached us before Sept,9th,
2002,This has caused us much inconvenience,
since we have already made preparations for
shipment according to our Sales Confirmation
No.4.
? You may recall that the same thing happened
to the execution of our last contract,It was
only after the market had turned for the
better that you opened the covering L/C,
quite beyond the time limit,We should have
refused then to effect shipment,but we
acceded to your request for fulfillment of
your order,At the same time we pointed out
that you should take effective measures to
prevent a similar occurrence.
? This article,as you know,has met with great
popularity since offered for sale,and new orders
have nearly exhausted our stock,But considering
our long-term business relationship we are still
holding the goods for you,
? We hope that you will lay great store on your
credit standing this time and establish the
relevant L/C before Oct,9th,2002.
? Please not that unless the L/C reaches us
before the suggested time,we shall have no
alternative but to cancel the contract and will
not enter into any more transactions with
you next year,We regret this decision,but of
course we are in on way to blame,
? We are looking forward to your letter of
credit.
Specimen letter-2:(2)Amending the L/C
Dear sirs,
? We have received your L/C No.xx,but regret to find
that there are certain points that do not agree with the
terms of our Sales Confirmation No,xx.
? 1.Our S/C No,xx emphasized that your letter of credit
shall allow transshipment,but the Credit states:
“transshipment prohibited”;
? 2,Your Credit calls for shipment in two equal
monthly lots during June/July,2002,whereas it is
explicitly stipulated in the S/C that shipment is to be
made in a single lot not later than July 31,2002.
? 3.There is no word,about” before the
quantity and amount in the L/C,although the
word is clearly used before them in our S/C.
? 4.Your L/C stipulates for the goods in an
assortment of Types A,B,C,20%,40%,
40% RESPECTIVELY,But the assortment
contracted for is,Types A 30%,B 30%,
and C 40%,
? You are requested to make the necessary amendments,
as the shipment is conditional upon the conformity of
the L/C with our Sales Confirmation.
? We hope that in future you will establish your letters of
credit exactly according to the terms and conditions of
relevant sales confirmation,or include in them such
terms as,AS PER S/C No…,”,By so doing you will
not only save much trouble,but also help to facilitate
shipment of your products.
? We are awaiting your bank’s credit amendment,
5,useful expressions
? (1) Our terms of payment are by confirmed,
irrevocable letter of credit in our favor,
available by draft at sight,reaching us one
month ahead of shipment,remaining valid for
negotiation in China for another 21 days after
the prescribed time of shipment,and allowing
transshipment and partial shipments.
? (2) In view of the small amount of this
transaction,we are prepared to accept payment
by D/P at sight (or at 30 days’ sight) for the
value of the goods shipped.
? (3) In compliance with your request,we will
make an exception to our rules and accept
delivery against D/P at sight,but this should
not be regarded as a precedent.
? (4) We regret having to inform you that
although it is our desire to pave the way for
a smooth development of business between
us,we cannot accept payment by D/A,
? (5) We regret our inability to make any arrangement
contrary to our usual practice,which is payment by
confirmed,irrevocable letter of credit payable against
presentation of shipping documents and valid for at
least 15 days beyond the promised date of shipment.
? (6) We wish to draw your attention to the fact that as
a special sign of encouragement,we shall consider
accepting payment by D/P during this sales-pushing
stage,We trust this will greatly facilitate your efforts
in sales,and we await your favorable reply.
? (7) Payment is to be made against sight draft drawn
under a confirmed,irrevocable letter credit without
recourse for the full amount of purchase,
Unit 8 Complaint and Adjustment
? 1,Complaint made by buyer—genuine complaint
? Non-delivery;
? Shortage supply/shortweight;
? Defective goods/poor quality;
? Poor package;
? Leakage;
? -----complaint made by buyer who find fault with the
goods as an excuse to escape from their contract;
2.Plan your letter
? Begin by regretting the need to complain;
? Mention the details of the goods complained about;
? State your reasons for being dissatisfied and ask for
an explanation;
? Refer to the inconvenience caused;
? Suggest how the matter should be put right;
3,Lodging a claim
? (1) If you have anything to complaint about,
make your claim at once;
? (2) Be sure the claim is accurate and
reasonable,and before you write a letter about
it gather all of the information that you can;
? (3) Avoid discourteous statements such as,I
demand,”,you will have to”,and,why can’t
you,” because they only offend the reader and
lessen the likelihood of your obtaining the best
possible adjustment.
4,The tone of the claim letter
Anger tone:
It was certainly carelessness on your part
to send me,Forever” brand bicycles
when I asked for,Phoenix” brand,I
simply do not understand……
Mile tone:
Today I received a consignment of 200
“Forever”
brand bicycles instead of,Phoenix” brand
specified in my order of May 23.
Adjustment
Slogan,Settle the problem and keep the customer!
1,Reply promptly;
2,Show understanding;
Apologetic,We are sorry for our late shipment.
Conciliatory:We are indeed sorry to learn of your
disappointment in not receiving our shipment.
3,Be tactful;
Negative,We have your letter about the alleged
loss of two cases of your consignment.
Positive,We are sorry to learn about the loss of
two cases of your consignment.
Negative,If what you say is true,we suppose
we will have to replace the damaged pens.
Positive,Please rest assured that we’ll replace
the damaged pens.
Correct the following sentences:
1,The wrong delivery of the goods resulted in our
careless handling your order.
2,Fifteen trays entered on the invoice,but there
are only twelve in the case.
3,Please let us know if we shall return the wrong
goods to you or keep them in the warehouse
for your disposal.
4,To our surprise,there are instead of only 20
cans in the Box No,3 not 24 as stipulated.
5,Since the goods delivered are below those of
the sample you sent us,we have return them at
you expense.
6,Much to our regret,we could not persuade our
clients accepting your goods of so poor quality.
7.The damages of the goods are not to be liable by us as
we have evidence enough that they occurred during
transit.
8,Since the sales contract is included an arbitration
clause,we might as well settle the dispute among our
two parties by arbitration.
9,We are supposed that you have made a mistake of
marking in which resulted our receiving the wrong
goods.
10.we are sorry to report 3 package short of Case No,20
