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The Management of Global Trade Distribution - Coursework Example

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Name Institution Course Date The Management of Global Trade Distribution Question three In the import and export industry, payment is done either done before, on or after delivery of goods and services. As a result, a company might offer services before payment in order to attract more clients due to competition…
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Download file to see previous pages However, if a business organization is not careful, competition might lead it into bad debts. This is because a company might sell its products to new customers, who might not be able to pay for the commodities thus leading to bad debts. However, this can be avoided by doing a customer value analysis and payment history analysis, Peppers and Rodgers, (2010). Customer value analysis is comparing what a customer is willing and able to part with in monetary terms and what satisfaction the customer gets from the good or service provided. Payment history analysis is reviewing past payment details of the company in question. A payment analysis allows the company to go through a customer’s financial statements in order to determine if the customer in question will pay for the goods provided in time hence avoiding the occurrence of bad debts. For example, if a customer’s financial records indicate that they owe other suppliers money then the company should only do with that customer on cash before delivery basis. If a customer’s financial statements indicate that the customer is not indebted to other suppliers and pays for goods in time then the company can supply goods to such customers on cash on delivery basis or cash after delivery. Question four When transporting goods and services various factors are considered when choosing the mode and means of transport. This in turn affects the charges incurred when transporting goods and services. According to Barnes, (2009), the type of goods being transported greatly affects the cost of transportation. For example, toxic materials require specialized containers when transporting them. Acquisition of these special containers might be expensive hence charges for transporting toxic material are high. Another factor that is considered when determining freight charges is the destination distance. Choice of mode and means of transport is also greatly affected by distance. If goods are being transported over long distances, then the cost of transportation will be high thus resulting in high freight charges.at the same time if the distance is short cheaper means of transport such as road is used hence resulting in lower freight charges. The time within which goods are to be transported also affects the cost of transportation. For example, if perishable goods such as fruits and flowers are being transported; a very fast means of transport is required. For such goods air transport is necessary which is very costly thus resulting in high freight charges. Another factor that determines the freight charges is the general nature of the goods being transported. The nature of goods determines how the goods are to be packed. For example some goods are bulky in nature hence take up a lot of space. Transportation of such goods is more expensive since the more space goods take the more they are charged. Question five Exportation of goods is not an easy task. It is a long process depending on laws put in place in both the country of origin and the country of destination. However, if the correct process is followed it can exportation can be simple and very effective. There are certain procedures set, to be followed when exporting anything. First of all one the exportation should prepare for the exportation of the commodity in question. One should make sure that they are conversant with the environments involved in international trade and the obstacles ...Download file to see next pagesRead More
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