Open Account
From Supply Chain Management Encyclopedia
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'''Russian: [http://ru.scm.gsom.spbu.ru/Открытый_счет Открытый счет]''' | '''Russian: [http://ru.scm.gsom.spbu.ru/Открытый_счет Открытый счет]''' | ||
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== '''General Provisions''' == | == '''General Provisions''' == | ||
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| + | In an Open Account transaction, the exporter conducts international business in a manner similar to the way it conducts business domestically<ref> David, P.A., Stewart, R.D. International Logistics: The Management of International Trade Operations – Cengage Learning, 2010 – p.142. </ref>. The exporter just sends an invoice to the importer along with the shipment and trusts the customer to pay within a reasonable amount of time, commensurate with the credit usually granted in the country in which the importer operates, usually thirty to ninety days. It is essentially the conceptual opposite of Cash in Advance, as the exporter shows complete trust in the importer and ships the merchandise without any guarantee that it will be paid. The only recourse in case of non-payment is legal action in the importing country, a time-consuming and expensive process that exporters rarely undertake. | ||
Revision as of 22:53, 30 July 2014
Russian: Открытый счет
General Provisions
In an Open Account transaction, the exporter conducts international business in a manner similar to the way it conducts business domestically[1]. The exporter just sends an invoice to the importer along with the shipment and trusts the customer to pay within a reasonable amount of time, commensurate with the credit usually granted in the country in which the importer operates, usually thirty to ninety days. It is essentially the conceptual opposite of Cash in Advance, as the exporter shows complete trust in the importer and ships the merchandise without any guarantee that it will be paid. The only recourse in case of non-payment is legal action in the importing country, a time-consuming and expensive process that exporters rarely undertake.
References
- ↑ David, P.A., Stewart, R.D. International Logistics: The Management of International Trade Operations – Cengage Learning, 2010 – p.142.
