Understanding Operative Capital: A Guide for Operative and Tactical Buyers

As an operative or tactical buyer, your role isn’t just about finding the best suppliers or negotiating prices—it’s also about managing a critical financial aspect of procurement: operative capital. This blog post unpacks...

Pre-payment and Advance Payment Guarantee.

The Dilemma of Pre-payment. At the heart of many business transactions is a simple question: should a buyer pre-pay for goods or services? The obvious risk for buyers is that, after paying,...

Comparison between a Letter of Credit (LC) and an Advance Payment Guarantee (APG)

The Letter of Credit (LC) and APG

Both the Letter of Credit (LC) and the Advance Payment Guarantee (APG) are financial instruments used in international trade and other transactions to ensure trust and security between the buyer and the seller. However,...

The Open Account payment method

The Open Account payment method is one of the most straightforward and commonly used methods in international trade. It is more flexible and less stringent than Letters of Credit (LC), Advance Payment...

Documentary Collection as payment terms

“Documentary Collection” (often simply referred to as “document collection”) is a common method used in international trade where the bank acts as an intermediary without providing any guarantee of payment, which differentiates...

Negotiating Payment Terms with help of a graph

Case Study: Negotiating Payment Terms in Procurement

Introduction to the Case In procurement, negotiating payment terms with suppliers is a skill that can influence a company’s cash flow, operational efficiency, and long-term business health. To illustrate this, let’s explore...

Should you pay suppliers on time?

For most buyers the obvious answer is YES, you should pay suppliers on time. Contracts and General T&Cs (Terms and Conditions) define payment terms and the number one argument is; if the...

illustrating an escrow transaction in a professional buyer setting

Escrow in comparison with Advance Payment Guarantee (APG)

As a procurement professional, understanding the role and function of an escrow in transactions, particularly in complex or high-value procurements, is crucial. Here’s an informative explanation about what escrow is, when it...

Tag: Payment Terms