|Merchant Services, E-commerce and Credit Card Processing Information|
Pitfalls of Doing Big International Brokerage Business Online
Nothing has helped international brokerage business more than the internet: it enables a businessperson to do business with little or no capital and to make quick contacts. Yet nothing has made the brokerage business riskier. This comes from a broker unknowingly linking genuine or false buyers with genuine or false sellers. Other ingredients also exist to cook the broker an unpalatable soup.
When all seemed bleak, I felt the internet was my best bet to boost my business. I visited some B2B portals and posted trade leads. An Italian, Arnoldo Marchetti, contacted me as mandate of an Austrian firm, Holzhšuser GmbH, and offered me NPK 10-20-20 (10% Nitrogen, 20% Phosphorous, 20% Potassium) fertilizer. I posted the offer on a site called Alibaba. The same day a German buyer, Schneider GmbH, contacted me with NCND, LOI with banking coordinates, and the authorization to verify the availability of funds. I emailed the NCND to Arnoldo and Holzhšuser for their details and signatures. Then I emailed the LOI to Holzhšuser. A week later, HolzhaŁser replied that what they had was NPK 10-10-10! When they heard this, Schneider blacklisted me.
This was the case of a genuine buyer meeting a fake seller. But it could also be a genuine buyer and a genuine seller. But Holzhšuser and Schneider having known each other, might have decided to kick me from the deal. Why? Because of greed: they probably wanted to keep all the commissions for themselves.
With the NCND signed, couldn't I have sued? Sure, I could, but there was no proof that the deal had succeeded. To find out would require a lawyer but I didn't have the funds to hire one. This is how the NCND, supposed to protect one, can become an inefficient tool.
Soon after a German lady called Gisela offered me Libyan crude oil. I was now in contact with several companies, one of which was an American conglomerate, AAA Commodity Dealers, which needed crude oil. I got an NCND signed by all parties and sent AAA the offer. They began negotiations with the Libyans but I was kept in the dark. Not even Gisela was being informed. It was weeks later we learnt the commission had been apportioned. Gisela got a pittance thanks to the German mandate. But I was offered nothing. AAA considered that I had done no work. I asked them to justify their stand but received no reply. Months later, the German mandate informed us that the deal had failed because AAA wanted part of the commission for the Libyans, who, they figured, were taking the lion's share.
This illustrates a genuine seller meeting a genuine buyer but the greediness of the buyer's mandate made me lose a jackpot.
On another portal called Oilworld I contacted an American mandate, Ray Lewis, representing a Canadian producer of rapeseed oil. Tung Shun Chemicals from Hong Kong needed this product. We launched the deal and this time the buyer exceptionally received the POP and samples from the seller; only the POF was needed to close the deal. Months passed but Tung Shun gave no POF and Ray had to cancel the deal.
This third case involved a genuine seller and a false buyer.
Undaunted, I continued the business. This time a Nigerian company, Goodwill Ventures, proposed me railway scrap. I emailed the offer to a Mr Pontus Hagstrom in Sweden who had an Indian buyer, Net-World Agency. Net-World sent an LOI without banking coordinates. On our insistence, they issued a fresh LOI with the coordinates but quoted a C&F target price lower than Goodwill's FOB price! Curious, Goodwill contacted Net-World's bank only to learn that they were insolvent. In order not to lose the deal, I proposed it to a serious buyer but this time it was Goodwill which proved phoney.
So in that case both the buyer and the seller were untrustworthy.
My brokerage business experienced other jolts too. These involved the greediness of buyers' mandates for fat commissions as well as the haggling over discounts or the POP and the POF between buyers and sellers.
I lost a Russian crude oil deal because the buyer's mandate wanted more discount than the seller gave and a gold transaction in which the buyer judged the seller's discount too low. But nothing made me crazier than losing businesses where the buyer insisted on the POP before giving the POF and the seller also expected the POF before giving the POP.
"Has anyone succeeded in this imbroglio?" I asked several brokers. Everybody said something wry like "I'm on a sure deal now." That was when I decided to take measures about my brokerage business.
So if you are contemplating doing big international brokerage business online, think of all the pitfalls that await you and the precautions to take to avoid them, such as:
- verifying the credibility of buyers and sellers by asking for proof of previous performance;
B2B Portal: An internet site where companies can meet to do business.
Trade Lead: The message that one posts on a B2B portal to seek goods or services.
NCND (Non-Circumvention and Non-Disclosure Agreement): An agreement that prohibits parties to a
deal from dealing with each other's contacts and/or giving confidential information to third parties
without written consent.
LOI: (Letter Of Intent): A stamped and signed acknowledgement on one's letterhead that one would buy
something being proposed.
POF (Proof of Funds): A note from a buyer's bank to the seller's that money is available for the deal
into which the buyer intends to enter.
POP (Proof of Product): A note from a seller's bank to a buyer's that the product offered is available.
Banking coordinates: Includes Account name, Account Number, Name, address (physical and postal),
fax number and email address of Bank, and Bank Officer's name.
C&F: (Cost and Freight): The FOB + the transport charges to the agreed destination.
Target price: The price that the buyer is prepared to pay.
FOB: (Free On Board): The price of the goods + the transport and handling charges to the port of
embarkation + the cost of loading the goods on board the ship.
My name is Akoli Penoukou. I was born in Lome-Togo (West Africa) in 1953. I went to school in Ghana (West Africa) up to the high school diploma level. I taught French there for one year and then returned to Lome to work. From there I went on "adventures" in Nigeria (West Africa) and Germany. Back home in 1983 I began my business career. This began with a West German import and export company which represented major German manufacturers like Henkel cosmetics in West Africa. I started as Executive Secretary and ended up five years later as Manager. Then I founded my own company in 1987 which I ran part-time. The activities of the firm having increased dramatically in three years, I diversified into imports and exports. The brokerage business and trade representation constitute the main thrust of my buinsess now. I have trained as a freelance writer for children and adults and have published in newspapers and magazines such as "Aim" and "Clubhouse" in America. Hobbies:writing, reading, gardening, languages, music, traveling, and teaching. I am married and have 3 children.
How To Turn Any Product You Sell In To Residual Income
The concept of this is for you to offer a subscription type product as an upsell or backend product. For example, if you're selling an ebook for $37 offer a subscription to a related e-zine for $9.95 a month. Instead of an e-zine, it could be monthly updated information for the ebook.
Direct Marketing isn?t all Brute Force
There are so many metrics surrounding direct marketing. So many facts, figures, test results and other sundry measurements.
Working With Drop Shippers
Drop Shippers, the manufacturers or distributors who are willing to ship their products to your customers, bring a powerful benefit to ecommerce. Online businesses that engage in the wholesale-retail trade can cut down on all the hassles of shipping their products by simply establishing business relationships with drop shippers, and using them as part of their business model. This article will cover the aspects of selecting a reliable drop shipper, the process of setting up with drop shippers, and also some of the common problems that may arise from working with drop shippers.
Your Affiliate Web Site Is Built ? Now What?
When I first got my web site built, I thought I finally had a presence on-line. Wrong! I soon found out that I needed someone to host my site, and I needed a domain name.
Google to Compete with PayPal?
PayPal is secure in its domination over the electronic payment industry, at least for now.
Shopping Cart Usability
Usable Shopping Carts Increase Sales
Online Consumers ? What Are They Complaining About?
For many businesses, e-commerce represents a tremendous method for generating revenues. To maximize the profit potential, you need to keep an eye on issues that drive your prospects nuts. The FTC maintain a list of the top 10 "dot.cons" complained about by consumers. If your site falls within one of these industries, you must make sure you address these concerns.
Ecommerce Comes from Customer Satisfaction
Online shopping is convenient, but many companies whose web sites do brisk sales often leave consumers wanting. That's according to ForeSee Results, a research company that studied customer satisfaction among Internet shoppers. One way to improve the experience is gift cards, according to Merchant Commerce (http://merchantcommerce.net), an e-commerce services provider. Gift cards can be used to reward loyal customers and to attract new clients. "People love to tell their friends about new shops or products they have found," said Rebecca Campbell, Manager of Merchant Commerce. "Gift cards get shoppers in the door, whether it's a Web store or a physical outlet."
Shopping from Your Cell Phone with Froogle Wireless
Many surfers already know about Froogle, Google's shopping portal that is still in beta testing. Google has now expanded their Froogle service so that it is available on WML-enabled cellular phones. Most newer cell phones that can connect to the Internet have this capability.
Choosing on Order Fulfillment Service
When your eCommerce business grows to the point where you can no longer package and ship the orders yourself, it's time to begin outsourcing your order fulfillment. Although all order fulfillment centers offer the same basic services, their individual methods and costs will help you choose one over the other. When selecting an order fulfillment service, keep the following in mind:
E-marketplaces from Sellers Perspective
What is an E-marketplace anyway?
Choosing an Ecommerce Shopping Cart
Choosing an online shopping cart is a big decision. Unlike a traditional brick and mortar business, your website is your only chance to impress potential customers. It needs to project a professional image to capture the trust of your visitors. The shopping cart is a particularly important part of your website because it deals with people's personal information and credit card numbers. People are nervous about online purchases and need to be assured that they are giving their credit card numbers to a reputable company.
How To Prevent Your 3rd Party Merchant Account From Suspension
What would you do if you were sent an email from your online credit card processor telling you that your account has been suspended or frozen? How are you going to pay the bills in the meantime? It is extremely important for you to familiarize yourself with the terms of your contract with your credit card processor. As long as you comply with their set regulation and guidelines to maintain your account in good standing you should have no problems.
Are You Making These E-Commerce Excuses? (part 1)
A year ago, I had big plans to re-vamp my web site. I was going to publish my e-newsletter twice a month ? every month, and I was going to upgrade my own e-commerce capabilities. Those were my Internet marketing "resolutions" for 2004.
Accept Credit Cards Online Without A Merchant Account
It is often assumed if you want to accept credit cards on your website that you must have a merchant account. This is not the case. You can accept credit cards with a Third Party credit card processor.
Your Site is all Direct Marketing
This may not be a popular view, but I think writing a web site is very similar to writing a piece of direct mail. I'm not talking about smash-and-grab fliers. I'm talking about those large mailings with brochures, a four or eight-page letter and a reply card.
ECommerce Scenario in Pakistan
Pakistan with highest growth rates in 1960s and bad politics in 1980s and 90s but, the stage is totally changed in 2000s as the economy is managed by those who once run the most successful Global Financial Houses. Today Pakistan has achieved 8.3% growth rates with highest percentage earning share zone in the whole world. Welcome to Pakistan 2005
Intranet Portals ? Search and Taxonomies
Knowledge Management for beginners
Conducting Business through B2B E-marketplaces
Businesses, which are still sitting on sidelines and not doing business on the Internet, should think seriously about their position! If you are one of them, chances are there, that you have to pay dearly for your indecision as you might lose significant market share to your more proactive competitors in a very short period of time.
To conduct business on the Internet, whether informal, one-time only transactions between two friends, or a full-fledged business selling products or services, payment arrangements have to be made. Before 1998, this often meant either checks sent through snail-mail, or very expensive, and often hard-to-obtain, merchant accounts for online credit card processing. In 1998, PayPal was introduced to fill the payment processing gap.
|home | site map|