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I hardly ever take a vacation for 30 consecutive days. At the beginning of my career, still working as an assistant in bids, I spend almost 2 years without vacation to be able to go out for 40 days and immerse myself in England and improve my English.
It was no disaster, I had 3 other people in that department to cover me and when I came back, I had a new table and a promotion to Export Analyst !!
“The problem is that I was an analyst without an assistant and with a managerial role.”
A few years later I got married and went on a honeymoon for 3 weeks, already with a newly appointed helper, who did not come from the COMEX area, but already worked with the product in national sales and had done the same type immersion that I do to improve your English. And that yes, it was a tremendous disaster.
When I came back, on a Monday, in the first working hour I had already received 3 phone calls from customers / importers (which means a lot in foreign trade, due to the cost of the call) to tell what had happened in my absence and ask for help:
• The first importing company was Angolan, they explained that they needed an inspection of the cargo and the exporting company had not authorized it in time, which caused them to miss the ship's deadline and suffer penalties from their client on the other side.
• The second company was Jamaican, these were desperate. The cargo had been retained in the exporting company because of a bank fee discount made by the intermediary bank.
• The third company was Chilean and was waiting for a complicated quote for spare parts that had been stopped for no less than 2 weeks waiting for my return.
“My first feeling was one of complete failure. How did this happen? And why didn't it happen when I was there?”
The answer came with time, and it boils down to:
• Lack of a clear procedure, written and approved by the board;
• inexperience of the person who replaced me;
• Vices brought in from the national market.
Explaining the stories:
Whoever works with Africa, knows that the cargo inspections on boarding are legal requirements of the local governments, if the cost was not approved in the quotation, it will have to be included at the end or paid directly by the importer. As exporters, what we have to do is coordinate with the auditing company chosen by the importer and run the boat, within the agreed schedule.
But in this specific case, the lack of experience caused my replacement to be paralyzed, without taking action out of fear and insecurity. Insecurity to revise the numbers and see that this fee was not included, then return the responsibility to the importer and fear of asking the director for help, or even interrupting my vacation.
“The case was solved when he asked for help and the process continued, however too late, causing many inconveniences to the importer.”
In the case of the problem with the shipment from Jamaica, I believe that it is something that everyone who works with COMEX has lived or will live. I have already dedicated myself to investigating the problem in depth, with several banks and there is no solution: SOME SHIPMENTS WILL HAVE RATE DISCOUNT AND OTHERS NO! Even if the importer informs you that the transfer costs must be borne by him (the famous OUR in field 71A of Swift).
This problem is solved in a few different ways, which DO NOT involve blocking the load. The exporter can:
1. Charge a flat fee per shipment that covers all of these unexpected costs;
2. Leave this amount pending to discount in future purchases;
3. Simply absorb the cost and notify the importer that he will take action with your bank, for the sake of a good relationship and continuity of negotiations.
“In terms of curiosity, this Jamaican client never negotiated with this exporter again, the trauma of this negotiation being such for him.”
In the case of the third company, that of Chile, what happens is that when structuring the export department it is common for management to think about sales and forget about after sales. The serious importer has to set up a unit independent from the factory in his country, with parts and pieces of the equipment he is installing, this is desirable for a good equipment importer.
However, when the technical requirements arrive, in a foreign language, the technical department is often not prepared for this interaction, and the responsibility falls on the export department, solely and exclusively by the language barrier. So this communication is broken and the company's image is super committed to the importer.
“For this reason, maintaining a multidisciplinary team involved in foreign trade and a clear definition of the responsibilities of each one is decisive for the success of the operation.”
The purpose of me telling these experiences in such detail is not to wash dirty clothes, it is far from that, the purpose is to show with facts, how a successful foreign trade negotiation is done.
The maxim of the client is always right does not apply here. For that we have the terms of trade, the INCOTERMS, a well-made Proforma, clear rules of the game. Do not be afraid to go back to the negotiating table and say: "This cost has not been negotiated and we will have to pass it on to you, now or later".
We have to have more engagement from all areas of the company. This can be an evolutionary process, there is no need to hire bilingual professionals in the company on day 1 of the project, but there must be a plan. Sooner or later, the entire company will have to be involved with it.
To paraphrase my dear professional colleague Cristina Wolowski: “Who exports is the industry and not the export department”, and the involvement of the board in this is essential, hiring suitable labor for each function, investing in the project with expected return aligned with the reality and understanding the obstacles and responsibilities of each party in the negotiation.
Questions or suggestions? Comment here! 😘
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