The letter of credit in the service of small businesses

How often are we confronted with the fact that small businesses could not stand the competition "blown away" for some two to three years. Entrepreneurs tend to bring down the entire blame on the networkers, the government and other entities that fall under the distribution in such cases, although often it is not in the external environment. It is known that entrepreneurial activity - an activity undertaken at your own risk, and so, trying to reduce their risks, entrepreneurs risk losing their business. The search for new contacts, markets and suppliers - a permanent, natural process, with a stop which stall and the business itself. Buying directly from foreign manufacturers or export their products may become a new stage in the development of the case, but not many people decided to climb it for many reasons. The major ones - the need for exemptions from the turnover of money for prepayment of goods or on the contrary, the delivery of goods without payment of 100% - easily solved by using the credit form of payment. Why is it so difficult to small businesses? - Obviously, the search for new partners and new contracts, and not the complexity of it all. Will not go into details, that a Letter of Credit, and what types of letters of credit are in bank servicing you in detail about all told. It is important to know that: The letter of credit allows you to take risks without risking If you still do not sign a lucrative contract with an unknown company just because of the fear of losing money, then credit will give you the confidence that in case of violation of its obligations under the opposite side of the bank hold the money in their until better times or even bring them back. Same goes for the risk of non-payment of your goods. The role of the bank when you open a letter of credit bank will not simply accept and execute a payment order, and acts as an intermediary between the seller and the buyer has the whole deal since the signing of the contract before shipment. Pluses are obvious, all sharp angles, misunderstandings, mistakes and other costs smooths the bank, and when you and your partner service "matchmakers" will no longer need, you can always renew the contract on standard terms. Either way, banks have a comprehensive legal help to beginners, so by avoiding potential problems. If you really really want to buy expensive equipment, but the price of bites, but do not want to take a loan, you can use letters of credit with deferred payment. 'll Note immediately that provide such a service is not all and not all banks, because percent compared to conventional lending is much lower. Imaginary dearness Letter of credit - not the cheapest service bank, but compare the amount of the contract, the potential loss from disruption of delivery schedules and other negative factors, and you'll find that calm face of the commission. Prices of banks ranging from 0.1% to 2% for the discovery, confirmation, and for receiving and checking documents, under the terms of the credit, so expect that will have to fork out thousands to 10-20 (course rubles). Part of the costs you can safely entrust your newfound partner, just and check its readiness for a civilized cooperation. Complicated paperwork? Those who are unable to open his own business, filed the first declaration and survive cameralka - has nothing to fear. And if you mastered the VAT declaration, UST and social insurance, then put together a package of documents to open or execute a letter of credit - for you trifling matter. Here the main attention to detail and clarity of contract language. Very nice ... have a letter of credit, because it is: a guarantee of obtaining money for his goods, vendor performance guarantees of obligations upon the shipment of goods; maximum leveling of non-payment risks, the ability to save money intended for payment of the contract, until the last moment in the back, obviously the right design and contract all documentation thereto; precise regulation of terms of delivery. The letter of credit and small business to get the goods from abroad without any, even symbolic, prepayment is quite possible, even the smallest company without any track record in the external or internal market, so the view that the Letter of credit can only benefit big business, fundamentally wrong. Accept a letter of credit should, as a tool for concessional lending. Perennial problems of small business - lack the necessary amount of money to prepay or reputation in the market can easily be solved with the help of credit form of payment. Try it, and, as evidenced by the representatives of the banks will not be able to refuse!