Acting as an import-export agent or joining the race of import-export business can be a hefty deal. More often than not, the agent or businessman encounters unpredictable payable fees, which cuts off their profit margin and leaves them feeling like a victim of twisted rules of the import-export industry. However, if you are on the other side of the game, i.e.., trying to protect commission fees in the import-export business as a middleman or import-export agent, you may have to be careful. The reason being, in the industry, more often, importers-exporters or buyers-sellers try to get out of “paying the agent” by risking their integrity. Thus, under the guidance of Cybex Exim solution’s expert team, we present top ways to protect commission fees in the import-export business. So, let’s take a glimpse:
Create a contract to save the deal
As an import-export agent, your single motive is to find a genuine buyer and a seller and craft a successful deal for both parties. As a reward, you receive your commission fees, and you move on to the next deal. However, in many cases, where the “promise to pay commission” is only oral and not written, import-export agents go penniless. To avoid such consequences, you as an agent can ask one or both parties to sign a contract. In this contract, it is advised to define the following aspects clearly:
- Percentage of profit that goes to commission (for example, 5% of total yield)
- Which party remains liable to pay (the one who signs)
- At what stage, commission fees remain receivable (for example, when the sales have been made or when the commodities ship from the seller to buyer)
Alongside the three aspects above, the commission fee contract crafts a legal agreement between the parties. In such a case, if the other parties refuse to pay at the respected timeline, the agent holds the right to take action against the parties.
Ask for Payment Guarantee Note
In multiple cases, import-export agents sue parties for not paying the commission fees after legal actions. Under such circumstances, it is recommendable to ask for a payment guarantee note from the parties’ primary bank before the deal is complete. By using this payment guarantee note, you can collect your payment directly from the bank.
Ask parties to issue a pre-written check with a future date
This is another simple way to protect commission fees as an import-export agent. You can calculate the timelines when the deal between the buyer and the seller will seal. In order to safeguard fees/commission, you can ask both parties to write a check beforehand which remains cashable or depositable at a date in the future.
For import-export data, agents, buyers, and sellers details visit www.Cybex.in.