What payments methods and terms should I use to pay a supplier?

A reader recently wrote in to ask: “what method of payments do Chinese suppliers prefer ? “

100% up front...is crazy

it’s up to the buyer to negotiate safe terms of payment.

Chinese suppliers prefer 100% in advance via bank transfer (or better yet- cash) and they would be very happy if you don’t bother to use a contract or PO.

Some buyers are crazy enough to do business that way and if something goes wrong, they have no leverage.

I assume the question is really about what methods will Chinese suppliers accept, rather than what do they prefer, and if you are looking for payment methods that are fair to both the buyer and the seller, you may be interested in these links:


Negotiation, Contracts and Payments – The Ultimate Guide

Safe Payments = Safe Sourcing

Common Mistake #6: ‘Payments not linked to performance’

How to lower my exposure to risk when sourcing?


Question answered by Mike Bellamy.

Advisory Board Member & Featured Blogger at the not-for-profit China Sourcing Information Center (www.ChinaSourcingInfo.org). Author of “The Essential Reference Guide to China Sourcing” and founder of PassageMaker Sourcing Solutions.

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