Here Is the Reason Why Everyone Can't Make Money

@ForeignTradeCaptain: Three Shakespeares

Currently, our client has three main suppliers in total. I rank second and hold a considerable share of their business. Moreover, this client has always paid a deposit and settled the balance before shipment.

However, starting last year, they asked us for credit terms of 30 days, which in reality stretched to over 60 days.

The three of us privately discussed this at the time, and each of us vowed resolutely: we cannot open this floodgate; we must stick to deposit and payment before shipment. Without being able to buy SINOSURE (export credit insurance), offering credit is just asking for trouble, isn't it?

As it turned out, the three of us, as if by unspoken agreement, quietly granted the client credit terms. This was simply because there were many orders, and we each wanted to eliminate the other two and take on more orders.

But after I offered credit, I found that my orders didn't increase. Instead, my money vanished—it was tied up in credit.

A couple of days ago, we had an open and honest conversation because the client was constantly delaying payments and was hard to collect from. It turned out, good grief, this client owes money to all three of us.