1. Methods of Payment

Cash in Advance (CIA)
This method requires the buyer to pay before the seller ships the goods. It is safe for the seller but risky for the buyer.
Example: The exporter asks the importer to pay 100% of the invoice value before delivery.

Letter of Credit (L/C)
A Letter of Credit is issued by a bank to guarantee payment to the seller if all required documents are provided correctly. It is widely used in international trade.
Example: The seller will receive payment once the shipping documents meet the L/C conditions.

Open Account
Under this method, the seller ships the goods first and the buyer pays later, usually within an agreed period.
Example: The buyer pays the invoice 30 days after receiving the goods.

2. Payment Terms

Advance Payment
The buyer pays part or all of the amount before shipment.
Example: The buyer pays 50% in advance and 50% after delivery.

Payment on Delivery (POD)
Payment is made when the goods are delivered to the buyer.
Example: The customer pays the driver upon receiving the products.

Net 30 / Net 60
These terms indicate the number of days the buyer has to make payment after the invoice date.
Example: “Net 30” means payment must be made within 30 days.

3. Modes of Transportation

Sea Freight
This is the most common method for transporting large quantities of goods over long distances. It is cost-effective but slow.
Example: Furniture and machinery are often shipped by sea.

Air Freight
Air transport is fast but more expensive, suitable for urgent or high-value goods.
Example: Electronic devices are frequently transported by air.

Road Transport
Goods are delivered by trucks, mainly for domestic or cross-border trade.
Example: Agricultural products are transported by road to nearby countries.