The transition to cooperation with foreign partners leads to the opening of new development opportunities, to strengthening the reputation, to adding stability to the company. And here the problem of the right choice of counterparty arises, which is very relevant for small business representatives. Next, we will talk about the tips that experienced businessmen give to those who are just starting cooperation with foreigners, devoting them to important details.
How to prepare for working with a foreign partner?
Before concluding a contract with a foreigner, you need to pay attention to a number of important points.
- Market research.
- Creating links. In many countries, personal acquaintance and close communication play a big role in getting started. Cooperation with a foreign company is possible only after establishing relations.
- The conclusion of a detailed contract. Everything that sounds during the negotiations should be recorded in detail on paper. This is understandable, as it concerns cooperation with domestic counterparties. But in working with foreigners there is also such an important point as the possible difference in legal norms. Therefore, consultation with lawyers of both parties is necessary.
- Thorough study of the structure of cooperation in terms of the legislation of both states and their tax standards.
- Verification of a business partner.
Next - we’ll talk about some of these points in more detail.
Opening a foreign currency account
A contract with a foreign company is more complex than with a Russian company. First of all, you need to open a currency account. In this regard, the company, in accordance with the requirements of the currency legislation and legislation related to combating illegal financial transactions, is subjected to additional banking verification.
In addition, when receiving money from abroad or when sending it to a foreign partner, it is necessary to justify these operations. For example, submit a contract and other documentation.
Partner Trustworthiness Check
It should be borne in mind that preparing for transactions with foreigners is necessary with special care, including at the stage of concluding a contract. First, a partner trustworthiness check should be carried out.
You need to make sure that the foreigner is registered in accordance with the law and conducts the activity that he has the right to carry out.
It is also required to be aware of the financial performance of the company and have information about its owners and managers. Primary information about a foreign counterparty can be obtained on its website. This data on registration, on activities, details, location, management. It is advisable to ensure that the information is current.
More detailed data can be found in online databases. They are available in almost any country, they collect information that firms disclose to investors and government agencies. These resources contain information regarding the history of companies, their reporting, material facts and other important information.
Statutory documents and powers
We must not forget about checking the statutory documents of a potential partner. You should make sure that the representative of the company signing the contract is authorized by it for this action, and its powers are duly executed. It must be borne in mind that if a person does not have the appropriate authority, the transaction may be declared invalid.
Also pay attention to the bank where the counterparty is served.It is very important that this financial structure is located in the country in which the counterparty company is registered.
Particular attention should be paid to the fact that the company is registered recently. Thus, a company operating in the market for less than one or two years and having no history should be considered as a risky partner.
Terms of an agreement
When concluding a contract, maximum specification of all its conditions should be provided. Detailed terms of delivery:
- Place of shipment.
- Destination.
- Overload availability.
- Estimated delivery time.
- Prices.
- Terms of payment.
- Attachments to the contract.
Among other things, the contract must include clauses indicating the responsibility of each of the parties. Who and what expenses are incurred in case of any problems related to non-fulfillment of the contract.
Additional precautions
There are situations in which, after the contract is concluded, the counterparty may invoice other details that differ from those specified in the contract. Then it is necessary to find out the reason for this and obtain written confirmation, given by several sources, that the new details actually belong to the company-counterparty, and not to scammers.
If there is no complete confidence in the partner, and the conclusion of a contract with him is very necessary for you, it makes sense to register additional guarantees in the contract. Here, a reliable means of enforcing obligations is a letter of credit.
And you can also record in the contract clauses that provide for all kinds of guarantees and sanctions. Such may be, for example, guarantees of the holding or the parent company of the counterparty, as well as bank guarantees, fines and penalties.
Communication with foreign partners
It should be noted that it is complicated by the fact that representatives of a foreign business partner were brought up in completely different conditions, and in their work they can focus on those aspects that are unusual for you. What needs to be done to avoid communication difficulties. To do this, it is advisable:
- To study the traditions of the country with the residents you intend to work with. Americans can show you a photo with their favorite dog, play tennis, but this does not mean that they consider you a friend. The Chinese value ancient traditions above all else and look at foreigners as superficial people. The French may be biased in their conversation in English. The Japanese will want to receive the most detailed information and will be interested in a clear differentiation of negotiators by age and position. Even a superficial knowledge of traditions will be your advantage.
- Get acquainted with the business traditions of the country of the business partner. Contracts with Finns or Germans will be distinguished by clarity, details, clearly defined stages of work, as well as deadlines. At the same time, the agreement concluded with the Japanese, as a result, will be short and not entirely clear, allowing different interpretations by both parties. The Chinese in the process of working with the contract value the calm of partners, their confidence and restraint. The British joke a lot and say something that is not meant, but in the end the negotiations are effective
- Learn the language of the partner. This is not about a high level of ownership, for this there are translators in the negotiations. But even some knowledge of linguistic norms makes it possible to better understand someone else's mentality. For example, the Germans have a clear and clear structure of the language combined with the habit of this people to order, with serious questions and thoughtful answers.
Thus, knowledge of traditions and language is a big plus in establishing cooperation.
Conclusion
There are many subtleties in building relationships and working with foreign partners, from the language barrier to the difference in legal norms.Therefore, in order to organize a successful business, you need a well-thought-out strategy, competent drafting of contracts, checking the reliability of the partner and studying the customs of the country, including those related to the business aspect ..