Two things you’ll learn from the Department of Commerce’s free Trade Finance Guide:
For exporters, any sale is a gift until payment is received.
For importers, any payment is a donation until the goods are received.
Written for the benefit of U.S. exporters (though just as helpful to importers), the Trade Finance Guide uses a no-nonsense approach to urge companies to choose their method of payment wisely when dealing with international transactions.
It gives a quick rundown of the pros and cons of each payment method (cash-in-advance, letters of credit, documentary collections, and open accounts).
Exporters, especially those new to exporting, will find the recommendations for when it’s best to use one payment method over another particularly helpful.
Written in plain and simple language, with each chapter only two pages long, the Trade Finance Guide is meant to be a short and sweet reading experience. It’s a free PDF, 32 pages in all.
Trade Finance Guide: A quick reference for U.S. exporters [Department of Commerce, International Trade Administration]