The 5 Major Payments Terms with Factories in China

There are 5 major payment terms with factories in China. These terms range from the most favorable to the factory to the most favorable towards you.
The major payment terms you will encounter when manufacturing in China are:
1. Full payment at the time of order
2. 50% down 50% at the time of shipment
3. 30% down, balance at the time of shipment
4. 30% down, terms
5. Nothing down and terms
The most common payment terms a factory will offer you when starting out an import-export business or Amazon fba business
is 30% down, balance at the time of shipment.
The terms are a sliding scale. The better your relationship and proof that you pay on time means you have a better chance of moving towards the more favorable payment side.
If you miss a payment or start paying late, you can expect the factory to start tightening the payment terms they offer you.
These terms are normally the same if you are using a factory or a trading company. If you use a sourcing agent they will charge you monthly as an aggregate of all that month's orders. Most sourcing companies are payable at time of invoice.
Pay on time and you'll have benefits or flexible payment terms which will allow you to scale up your business faster.
------------------------------------------------
My name is Chris Folino. In 2000 I founded a sourcing agency, Newvision Asia Ltd.
I have managed hundreds of millions of dollars in purchase orders and overseen tens of thousands of skus from China.
After returning to the U.S. my interest in sourcing has evolved into the desire to teach others how to successfully source from China.
To learn how to protect yourself and make more money when sourcing from China check out: newvision-asia...
Buying and sourcing from overseas will never end, but it does evolve. I look forward to educating you on the sourcing process and keeping you up to date on the changes happening in the Chinese sourcing market.
Click the "Subscribe Button" and the bell to stay up to date on the latest videos related to sourcing and manufacturing in China.