At a point, you might need to expand your supply maybe your international buyer increases their order from 100mt to 700mt/ per month. At this point, you will need more hands, contacting different suppliers becomes paramount. Here you need to design your company terms and condition. Your company legal adviser will handle that paper works.
When you receive your payment most of the times, importers preferred IRLC (irrevocable letter of credit) through your bank.
Confirm the letter of credit through your bank or advising bank
Approach your bank to issue a comfort letter or bank guarantee (BG) for your suppliers. In equivalent to the goods they will supply you. Clause it that “until the goods are checked and you are satisfy, full payment is made
Because this procedure comes at a cost or charges through your bank, tell the supplier to open 2% performance bond.
The implication is that if the total payment for the goods is 100million naira, your supplier deposit 2% of it as a performance bond when you fail to meet up with the supply which the BG is issued, you forfeit your deposit. Hint* you hold them to ransom by making them to supply without delay or probably get rid of incompetent suppliers
But most suppliers just need your sincerity about your payment terms. They don’t need bank guarantee and what they know as an established supplier is that they can divert their products to other buyers when you act funny on delivery. They always have valid plan B. So be careful dealing with such suppliers. Let your supplier have confidence in you. With confidence, you can acquire any quantity you want in no time even without passing through the procedure of BG
Contact sehgate team for reliable supplier from any part of Nigeria. We have database of suppliers that are ready to deliver to your warehouse.
Tips* always remember most agro commodities are being traded as open market. As at the time you are buying, other exporters are also buying therefore, the price you offer must be competitive enough to work with. Example “if maize is sold in Kano for #135,000/ton and you offer supplier #140,000/ton in Lagos, they will prefer supplying to Kano and get paid immediately than coming to Lagos only to be delayed with bad price. Be flexible.