Best Practices
It is well known that Germany is popular for their imports
and exports in and out of the country.
As I was doing some research, I was able to find out more about common methods
of payment, open account, letter of credit, cash advance, documentary
collections, and more. It seems that today a majority of German customers participate
in something that is called an under seller buyer term. This includes a common
30/60/90 day accounts or even payments that are against documents. It comes as
no surprise that the most popular payment method is by electronic funds transfer.
The reason that this is so popular is because
it is the fastest and cheapest way you are able to transfer any type of fund.
As technology has advanced, online transfers have become more secure as well as
transparent. It seems as if the letter of credit is still utilized but only
covers a portion of total imports. This is due to both cost and time requirements.
L/C’s for a payment under 5,000 in U.S Dollars is almost unknown in their
perspective. The United States can also encounter Bills of Exchange which is
usually payable within a specific time period of about 2 to 3 months. On top of
that, we had found out that Cash in advance is a rare thing in German import payment.
Overall, Germany has very interesting Exporting and Importing Practices.
Sources:
Germany - Methods
of Payment | export.gov. (2017). Export.gov. Retrieved 20 April 2017, from https://www.export.gov/article?id=Germany-methods-of-payment
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