Warming-up Exercise As the largest developing country with the biggest population, China selected the textile and clothing industry as the pillar industry in its economic reform starting in the 1980’s. After many years of development, the textile and clothing industry in China has built up very competitive infrastructures. In the eastern coastal areas around the Bohai Sea, and in the Yangtze River Delta and Pearl River Delta, there are very good industrial clusters for the production of textile and garments. Now China has become the world’s biggest manufacturers and exporter of textiles and garments whilst, at the same time, due to its largest population and growing economy, it has the potential to become the biggest consuming market for textile and garments. In 2008, the combined value of China’s imports and exports in textiles and garments reached 203,750 million US dollars (about 8.0% of the total amount of China’s imports and exports of tangible goods). The value of exports in textiles and garments in that year was 185,220 million US dollars, resulting in a favorable trade balance of 166,680 million US dollars.
Exporter should go through several stages for preparing a business negotiation. First, he must investigate the _____1_____and _____2_____ of the buyer to choose appropriate _____3_____ then he need to know the _____4_____ of destination country. Other parties such as _____5___, ____6_____and ___7____should also be taken into consideration. In addition, he need to determine related expenses such as ____8_____ or ______9_______. Throughout the transaction, all information may be updated, so the export ought to continuously monitor _____10_____ of all parties.
1. credit status 2. business reputation 3. contract terms 4. political or economical situations 5. manufacturers 6. carriers 7. insurers 8. freight 9. insurance premiums 10. the status.
Establishing Business Relations Establishing business relation is the first step ___1___ develop foreign trade. A successful businessman is able to get new opportunities ___2___ the company he works for. One may establish business relations___3___ companies abroad through many channels ___4___ banks, chambers of commerce, trade directories, business associates, commercial counselors’ office, commercial office of embassies, advertisements, exhibitions ___5___ trade fairs, market surveys, recommendations ___6___ business partners or clients and other sources. There are goods ways ___7___ help you find the potential buyers. Once you find the potential customers, it’s important to contact them ___8___ e-mail, fax, MSN online or even face-to-face meetings. Since then, the process ___9___ inquiry, offer, counter-offer and acceptance is usually required ___10___ the export negotiation.
1 to 2 for 3 with 4 like 5 and 6 by 7 to 8 by 9 of 10 in
Mr. Carter has interest in buying _____________________. Mr. Lee is a _________________ for this series of suit in North American market. Mr. Carter should contact ______________________ for direct trading in his region.
White: Hello, Mr. Gao. I come here today to inquire about the possibility of establishing trade relations with your company. Gao: Hello, Mr. White. Welcome to our company. White: We’d like to order some Chinese-made ______1_____, tapestries, _____2_____ and so on, if your terms are favorable. Gao: I’ll see what we can. Please follow me to your _____3_____ first. This is a pure wool carpet and that one is of artificial wool, both made in our company. We use two ways in weaving our carpets. One is _____4______, the other is hand-woven. With different materials and ways of manufacture, the prices are quite different. One feature of the wool carpet is plain and _____5_____ in color. The design is classic and _____6_____. White: Would you please show me some more tapestries? Gao: All right. We produce various kinds of tapestries, such as pure wool and velvet. We can offer you rich patterns, namely _____7_____, flowers and plants, birds and animals and so on. White: Oh, I have seen _____8_____ and studied your catalogue. I believe some of the items will find _____9_____ market in Canada, especially pure wool carpets and velvet tapestries. Here is a list of my _____10_____.
White: Hello, Mr. Gao. I come here today to inquire about the possibility of establishing trade relations with your company. Gao: Hello, Mr. White. Welcome to our company. White: We’d like to order some Chinese-made carpets, tapestries, blankets and so on, if your terms are favorable. Gao: I’ll see what we can. Please follow me to your showroom first. This is a pure wool carpet and that one is of artificial wool, both made in our company. We use two ways in weaving our carpets. One is machine-made, the other is hand-woven. With different materials and ways of manufacture, the prices are quite different. One feature of the wool carpet is plain and tasteful in color. The design is classic and elegant. White: Would you please show me some more tapestries? Gao: All right. We produce various kinds of tapestries, such as pure wool and velvet. We can offer you rich patterns, namely landscape, flowers and plants, birds and animals and so on. White: Oh, I have seen exhibits and studied your catalogue. I believe some of the items will find ready market in Canada, especially pure wool carpets and velvet tapestries. Here is a list of my requirements.
Dispatching Samples As the overseas buyers generally ask for the samples before placing _____1_____ orders, it is _____2_____ that the samples should be ____3______, _____4_____ and have retention and reminder value. Exporters have to dispatch the ____5______ samples (either large or small ones) for customer’s confirmation. In practice, sometimes sample confirmation can not be _____6_____ on time, so ____7______ traders need to make records for each confirmation. Exporters usually dispatch samples to their customers overseas via the world’s _____8_____ courier companies like DHL, UPS, FedEx and TNT etc.
1. confirmed 2. essential 3. attractive 4. informative 5. right 6. reached 7. export 8. big
1.Mr. Brown received the following items from Mr. Liu except for ___________ A. price list B. cotton underpants samples C. newly-developed cotton underwear D. brochure 2. What is Mr. Liu’s principle of doing business? A. quality the first B. beautiful package C. keeping the promise and honoring the contract D. customer the first 3. What does “coincide” in the sentence “Your desire to establish business relations coincides with ours” mean? A. in the same area B. during the same period C. agree exactly D. correspond exactly
Inquiring and Offer DescriptionPriceQuantityPackageDeliveryPayment
Inquiring and Offer Offer from seller DescriptionPriceQuantityPackageDeliveryPayment 206 cm bed sheets $60/ piece1000 pcsFOB Shanghai. 5% commission included
Offer from seller DescriptionPriceQuantityPackageDeliveryPayment Micro-fiber fleece bath- robe $5.90/piece8,000 pcsPacked in plastic bags, each four dozen in a corrugated cardboard box be delivered in two consignments of 4,000 each, the first by November 30 and the second by December 20. FOB Dalian
Counter-offer and Acceptance 1.Why doesn’t the buyer accept the offer immediately? 2.What does the buyer usually do after receiving the offer? 3.How does the buyer “counter-offer”? 4.What does the seller do after receiving the “counter-offer”? 5.Do you think there will be “counter-counter-counter-offer.” in real business negotiation?
1.Generally speaking, no offer is reasonable or to buyer’s satisfaction, because he wants the lowest price. 2. Usually, the buyer tends to make a very careful analysis and study of the offer and the current market situation, and suggests some changes in the terms and conditions in the offer. 3. After careful analysis and study of the offer and current market situation, the buyer will state his own terms and conditions to the seller. To convince the seller of his position, the buyer should give proper reasons to support himself. We call this reply “counter offer”. 4. The seller has the right of acceptance or refusal. When receiving the buyer’s counter-offer and finding some terms and conditions unsatisfactory or even unacceptable, the seller will state his own opinions. This is called “counter- counter-offer.” 5. Yes. The business negotiations often go through several rounds before conclude a deal.
Business Negotiation I. Terms of Payment 1. The buyer has good creditworthiness A. Remittance 2. The market is favorable to the seller B. Letter of credit 3. The market is favorable to the buyer C. Open account 4. Lowering the risk of the entire transaction D. Collections by the issuing bank’s own credit
1.The buyer has good creditworthiness → Open account (C) 2. The market is favorable to the seller → Remittance (A) 3. The market is favorable to the buyer → Collections (D) 4. Lowering the risk of the entire transaction by the issuing bank’s own credit → Letter of credit (B)
II. Shipment A: Could you tell me how you ship the goods? B: We’ve booked a ______1_______ to sail to your port in the middle of next month. A: In the middle of next month? A ______2_______ of one and a half month is too long. You know our order is such a large one that it will ______3_______ our fund. Could you see your way to advance shipment? B: I’m afraid not. A: As you know, next month is the ______4_______ for this commodity. In order to meet the season, we hope you will ship the goods before the end of this month. If we miss the season, it won’t ______5_______. B: To make it easier for us to get the goods ready for shipment and to meet your urgent need, we hope that ______6_______ will be allowed. We will ship half of your order at the end of this month. What do you think? A: Could you make it better? Say, 80% for _____7________? B: I’m terribly sorry. We’ve already tried our best. A: How about two thirds of the goods shipped at the end of this month and ______8_______ in the middle of next month? B: That’s workable. Then, shipment will be made strictly according to the schedule. A: Thank you.
1. direct steamer 2. lead time 3. tie up 4. selling season 5. bring profits 6. partial shipment 7. the first shipment 8. the balance
III. Insurance A: Mr. Han, before I leave for Chicago, I think we’d better discuss the insurance. B: Our business is concluded on a ______1_______ basis. You’ll take out insurance as soon as I send you the shipping advice. A: To be safe, I prefer your effecting insurance for us. Is it possible? B: If you want, we’d like to. What coverage do you plan to insure? A: First of all, I think ______2_______ should be covered. What about additional risks? Could you give me some suggestions? B: For glass pending, breakage is especially necessary, I think. A: Good. Any others? B: To be more exact, is ______3_______. A: Right now there is a large strike by workers in Chicago. What will happen when the goods are shipped? B: I think you should effect the insurance against ______4______. A: OK, that’s settled. To sum up, WPA, Risk of Clash and Breakage and Strike Risk. B: If so, I will cover the insurance for you right now. A: Remember to send us your debit note for the ______5_______.
1. CFR 2. WPA 3. Risk of Clash and Breakage 4. Strike Risk 5. premium
IV. Packing (1) corrugated paper (2) stuffing material (3) tarpaulin (4) metal strap (5) transparent plastic (6) coating
(1) corrugated paper 瓦楞纸 Corrugated paper board, water proof paper, cellophane, kraft paper 瓦楞纸板，防水板，玻璃纸，牛皮纸 (2) stuffing material 填料 Excelsior, nylon wire, thread 刨花，尼龙丝，线 (3) tarpaulin 油布 Canvas, tin, fiberboard 帆布，马口铁，纤维板 (4) metal strap 铁腰子 Nylon strap, plastic strap, adhesive tape 尼龙腰子，塑料腰子，胶带 (5) transparent plastic 透明塑料 Fermented plastic 泡沫塑料 (6) coating 涂料 slushing compound 抗蚀润滑剂
Sales Contract 1. The Chinese and English versions of the contract are equally effective. ( ) 2. Containers are allowed in this business to save time and money ( ) 3. The buyer shall have the right to cancel the contract if the late delivery exceeds ten weeks. ( ) 4. The buyer and the seller have some arguments for the arbitration clauses. ( ) 5. The contract will come into effect after it is signed by both parties. ( ) 6. The down payment is a prerequisite for the effectiveness of the contract. ( )
1. The Chinese and English versions of the contract are equally effective. ( T ) 2. Containers are allowed in this business to save time and money ( T ) 3. The buyer shall have the right to cancel the contract if the late delivery exceeds ten weeks. ( F ) 4. The buyer and the seller have some arguments for the arbitration clauses. ( F ) 5. The contract will come into effect after it is signed by both parties. ( T ) 6. The down payment is a prerequisite for the effectiveness of the contract. ( T )
Claims and Adjustment No.ItemComplaintDemandPossible solution
No.ItemComplaintDemandPossible solution 1 10,000 pairs of lady’s shoes Wrong goods (Received the some amount of men’s) ReplacementSend the correct goods to the buyer as quickly as possible and ask buyer to sell the wrong goods for them at a lower price. 2 10 tons of cotton Poor quality (The survey report showed the analysis of the excessive moisture on the goods; these goods were not as dry as required before shipment). Refund (Lodge a claim amounting to 10 tons) Accept a compensation of 10 tons. But the inspection fee should be borne by the buyer
Group Discussion 1. What kind of deal can be called successful? 2. Compared with domestic trade, what else should be considered in international trade? 3. What procedure is the most important in international trade?
Assignment Practice every procedure in an international deal with your group members Choose one procedure and present to your classmates
Reference For more topic-related information, please refer to the following websites: http://info.txooo.com/Commerce http://www.amteam.org/k/ASP/2005-10/511671.html http://www.ccpit.org http://www.asiabt.com/