Politics drives economic policy and economic policy guides business decisions. Its critically important during geopolitical influenced economic uncertainties that we minimize assumptions and emotional biases to our products and companies and make data driven decisions and choices.

These decisions should be based on facts derived from keen research and analytics and a logical thought process. There is no shortcut, you need to do or contract-out the work.

Focusing on Southeast Asia markets

After living in Singapore and working throughout the Asia Pacific region for more than 20-years, I offer my opinion based on my experience and expertise to help companies navigate the inherent challenges and barriers and  successfully compete and win in the fastest growing region on the planet.

In particular, the ASEAN, Indo-Pacific, or Southeast Asia region has emerged as the global growth engine of the next decade and beyond.

Companies worldwide should be pivoting to the region to take advantage of new and emerging growth opportunities.

Export is crucially important to any growth-minded company. It establishes the first step to entering a new market. As your business scales you can decide upon progressive steps like establishing a local sales office, bonded warehouse, or local manufacturing. In most cases exporting leads to foreign direct investment (FDI) in local manufacturing assets, either greenfield or acquisition.

Southeast Asia is not a homogenous marketplace. Each country is a different ecosystem, with its own vibe and set of preferences, values and norms. New entrants must be capable of understanding and embracing social and cultural diversity.

One-size-fits-all cookie-cutter strategies fail in Southeast Asia, – you need to tailor your approach to each unique market.

Don’t just adapt to Southeast Asia, become a part of it. Take the time to understand the culture, the history, and the emotions behind customer buying behaviors.

Getting started with market research

So where do you start? The first step is to identify, validate and quantify opportunities, and determine your company’s export readiness. The second step is to craft your market(s) entry or go-to-market strategy and business plan – think of strategy as your logic and compass, and your plan the roadmap or process.

The third step is to develop a distribution network capable of reaching your target customers. If you’re selling B2B2C you need channel partners. This article will delve into the first step of evaluating export markets for your business.

Finding the best sources of secondary research

Normally, when I approach a new research assignment, I purchase two industry reports. A typical and focused market survey or industry report will cost between $2,000.00 – $3,000.00 US.

Industry reports are a market assessment tool that provide a comprehensive examination of a particular industry in specific countries.

In my Indonesia example below (figure 1), the company wants to sell its fiber cement exterior finishing products. The total market volume for exterior finishing products is 79 million M², fiber cement products represent 4% of the total market volume. The company’s addressable market in Indonesia is 3.16 million M². I then convert volume into economic value, (volume x wholesale cost per M².) Most reports will provide compounded and annual growth rates and trends.

Other valuable sources for secondary data are Export Development Canada (EDC),  Asia Bank, IMF, government websites, Channel News Asia, and a few of my favorites that require a subscription are Nikkei Asia, Oxford Business Group, Focus Economics. I also use a segment specific project and leads directory when needed – as an example in the Asia Pacific construction segment I use BCI Asia. Secondary research data can cost between $8,000.00 – $10,000.00 US, depending on the scope of the research project.

Presuming we now have loads of secondary data, the data now needs to be translated into quantifiable, meaningful and useful information that can be shared and understood cross-functionally.

Analyze your data using the PESTLE model

One of the most useful analytical tools to evaluate markets is the PESTLE model, (Political, Economic, Social & Cultural, Technology, Legal, and Environmental factors.)

The PESTLE tool has evolved over the years, starting as a PEST analysis more than 20 years ago, then to the SLEPT analysis, and to what is used today the PESTLE analysis. An interesting and important addition is the Environmental factors.

The importance of Environmental factors and compliancy and how this can be leveraged or translated into differentiation and customer value should not be underestimated.

Southeast Asia customers make brand choices based on personal value perceptions and the environmental benefits and impact of your products. In addition to the PESTLE model, I use a weighted scorecard to visually organize and present my findings.

In my abbreviated example below (figure 2) I am only comparing three countries, all countries under consideration must be evaluated. Each main factor will have five to ten sub-factors. Each sub-factor is weighted on importance and given a score, the scores are tallied, then each main factor is calculated. In my example the total score for Singapore main factor political is 36.

We then create a graph chart (figure 3) to visualize our comparative and quantitative analysis. Every company’s analysis will differ due to different metrics or criteria. Each company will also have a threshold, in my example my minimum threshold value is 120, so Indonesia and Singapore would be selected as my target markets for further evaluation.

Further evaluation would come in the form of primary data collection, so get your passport ready, you need to travel to meet the potential customers you intend to sell to.

Get your passport ready for primary research

The best source for primary data collection is “voice of customers” (VOC), and I am a strong supporter of trade shows in the Southeast Asia region. However, trade shows are expensive, and the merit of a trade shows needs to be carefully considered.

In the post-Covid environment trade show costs have increased to pre-Covid levels. Trade show space and booth design cost will vary, I try to cap this cost at $15,000 US. You also need to consider travel expenses, and that cost could be $10,000 per week including airfare.

Considering this, we need to establish clear and attainable goals or outcomes to justify the expense. For me my goals are to:

1. understand the market and customers and begin building relationships
2. interview potential customers
3. identify key competitors, and
4. recruit distribution and channel partners.

I have learned from past experience to add a week post trade show to follow up with contacts and prospects gleaned from the event.

As an example, prior to Vietnam’s economic awakening, we identified Vietnam as a rising economy and attractive market. We attended a relevant trade show and then the following week was filled with business development activities, visiting potential distributors and customers, and we appointed two new distributors.

At this point we have conducted our initial PESTLE analysis through secondary data collection, participated in our first overseas trade show, visited potential customers and channel partners, and we can now amend our PESTLE analysis based on the more comprehensive information gleaned from our overseas trip. Next, we need to assess our capabilities and ensure we are correctly positioned and aligned to capitalize on the opportunities uncovered. Are we export ready?

Evaluating your export readiness

Being export ready is more than a mindset, it’s a commitment of resources and funding to support a successful export endeavor. The export ready self-evaluation process will help define your strategy and plans. FITT’s Feasibility of International Trade course provides thorough and contemporary training on how to assess organizational readiness. Typical questions

• Are you willing to invest in resources, people, time and capital without an immediate return on investment (ROI)?
• Will your pricing strategy enable you to compete profitably?
• Is product customization required to meet specific market or customer needs?
• Are your products compliant to relevant codes or standards?
• A new one for me recently, will your bar-codes scan in overseas markets?
• If exporting to a non-FTA country, what is the duty impact to market pricing and profitability for you and your partners?
• What are your trade terms and conditions, do you need credit insurance?
• Have you established clear, relevant, and attainable goals?
• Do you have senior leadership and cross-functional support?
• Do you have an international freight forwarder?
• Do you have experience with export documentation, do you understand incoterms?

Each company is unique and will have specific questions relevant to their business and chosen markets. Go beyond the superficial qualitative narrative and translate the data into actionable quantitative information.

The next step is to craft your market-entry strategy and business plan. Remember each market is unique, and the Southeast Asia marketplace is not just about products and price-points, it’s about people and relationships founded on symbiotic trust, confidence and collaborative partnerships.

I will share my thoughts on strategy and plans in my next article.

For more valuable tips and concepts follow me on FITT, LinkedIn, or my website.

With the Teamsters union reaching a tentative contract deal with UPS management just days short of the July 31 deadline, what is said to be the largest strike in a century against any U.S. employer, has been narrowly dodged.

Since UPS is responsible for almost a quarter of all U.S. deliveries, the strike would’ve been devastating on the U.S. economy. According to a study conducted by the consulting firm Anderson Economic Group, a 10-day UPS strike would stand as the costliest strike in at least a century, inflicting a staggering $7 billion economic impact on the U.S. economy.

UPS delivers more than 24.3 million packages everyday and its competitors like FedEX and DHL would not have been able to bear that kind of backlog had the strike taken place. “In the event of a market disruption, no carrier can absorb all UPS volume,” FedEx executives wrote earlier this month.

These disruptions have far-reaching implications for U.S. imports and exports, as delays and bottlenecks in key ports can ripple through the entire supply chain, affecting businesses across the continent.

And as we talk about supply chain disruptions, the impact of the Canadian BC port strike adds further challenges to North American shipping. Canadian National Railway Co., the country’s largest railway, predicts it will take two months to recover from the B.C. port strike. The recent two-week strike at B.C. ports halted freight flows through West Coast terminals, leading to a minor impact on earnings this quarter.

Projected impacts on North American shipping

The strikes have triggered considerable supply chain disruptions across North America. Additionally, freight forwarding and shipping services are under pressure due to increased demand amid global trade uncertainties. These disruptions have led to delays, congestion at ports, and challenges in meeting delivery timelines.

“I expect we’ll see shortages of inputs, higher shipping prices, which will ultimately be passed on to consumers, and longer lead times for deliveries if the strike takes place,” Bart De Muynck, chief industry officer at project44, a supply-chain data company told Bloomberg in an email.

According to survey results released by the Canadian Federation of Independent Business 53% of business owners believed that the strike will affect their operations.

Even though a tentative resolution has been met in both cases, the surge in freight forwarding demand will likely cause prolonged delays in the supply chain. This situation can lead to increased costs, reduced profitability, and potential damage to business reputations. As U.S. and Canadian imports and exports are affected, industries relying heavily on timely shipments, such as retail and manufacturing, may face significant challenges in meeting customer demands.

7 ways businesses can mitigate the unforeseen

As the shipping industry grapples with ongoing disruptions, businesses must consider mitigating actions to protect against further crises.

1.    Diversify shipping routes

To mitigate the impact of port strikes and disruptions, businesses should adopt a proactive approach and work to diversify their shipping routes. It is crucial to collaborate with reliable freight forwarders who can assist in identifying alternative routes that can be utilized during times of disruption.

By exploring and establishing contingency plans for various shipping options, they can ensure smoother operations and minimize the adverse effects of potential disruptions on their supply chains.

2.    Leverage multiple carriers

Relying solely on a single carrier at any point along a shipping route can leave businesses vulnerable to delays and bottlenecks when a strike occurs.

Experienced freight forwarders and logistics experts can help you plan for back-up carriers, both domestic and international, to spread the shipment load and minimize dependency on one provider.

This strategy not only minimizes the impact of major disruptions but also enhances flexibility and adaptability in the face of even minor challenges, allowing for the best service available.

3.    Optimize technology and tracking

Businesses can utilize advanced tracking systems and technology to monitor shipments in real-time. These systems enhance visibility and enable more proactive responses to potential delays or rerouting. This enhanced visibility provides businesses with crucial data and insights, allowing them to stay informed about the location, status, and potential challenges their shipments might face.

With real-time tracking, companies can  identify any potential delays or deviations from the planned routes sooner, enabling them to take immediate actions to address these issues.

4.    Re-evaluate contracts

Having full clarity on liability and compensation terms within shipping contracts and freight forwarding agreements is essential to navigate through periods of uncertainty. Are the correct Incoterms identified throughout the contract? Seeking professional legal advice during contract negotiations can help businesses to identify potential gaps or loopholes that could leave them vulnerable during crises.

By renegotiating contracts to include specific clauses that address issues related to labour disruptions, force majeure events, and supply chain delays, they can establish a solid framework for handling unforeseen challenges.

5.    Proactive communication

When faced with potential delays or disruptions, it is essential to keep customers informed in a timely and honest manner. Openly sharing information about the challenges being faced and the steps being taken to address them fosters trust and confidence in the business relationship.

By providing regular updates on the status of shipments and any possible delays, businesses can manage customer expectations and allow them to plan accordingly.

6.    Identify opportunities for flexibility

Another important thing businesses can do to is assess their logistics operations and identifying areas where they can be flexible. This involves recognizing parts of the supply chain where slower delivery or alternative transportation methods can be accommodated without compromising overall operations.

By identifying areas of flexibility, businesses can proactively communicate with suppliers, freight forwarders, and customers to set appropriate expectations and develop contingency plans.

7.    Invest in risk management

Investing in risk management is crucial for businesses seeking to enhance their supply chain resilience. By developing robust risk management strategies, companies can proactively address potential disruptions before they escalate into significant challenges.

A comprehensive risk management approach involves carefully analyzing the supply chain from end to end, identifying vulnerabilities, and understanding how various scenarios could impact operations.

What does the future look like for businesses impacted by the North American shipping strikes?

In the face of ongoing challenges, businesses must prepare for a future that prioritizes resilience and adaptability.

The recent strikes and disruptions have highlighted the need for diversified shipping routes, efficient risk management strategies, and transparent communication with customers.

Embracing advanced tracking technology and collaborating with reliable freight forwarders will become essential components of successful supply chain management.

Looking ahead, the future of shipping in North America will likely witness a growing emphasis on optimizing imports and exports through robust and flexible logistics networks. By proactively addressing potential disruptions and investing in innovative solutions, businesses can position themselves to thrive in an evolving and dynamic shipping environment, where the new normal is to expect the unexpected.

Sourcing, business communications, supplier selection, contract management and supplier relationship management are among the most important activities in the procurement process.

Procurement specialists at SMEs usually learn the main skills of the job by trial and error, which often leads to unnecessary costs to organizations. It is obvious that knowing and avoiding these types of mistakes will help small enterprises save money and increase profit.

Here are eight of the most common global procurement mistakes made by SMEs.

1: Relying on internet searches for supplier selection

Everyone can go online and find a directory of hundreds of suppliers. But these lists often include fradulent and/or unreliable companies.

Conducting an online search for suppliers is a primary and required step for sourcing, but it is not sufficient for a final decision.

Many companies have made this procurement error and been subject to phishing and fraud because they placed their trust in suppliers based on what they found online.

It is essential to do your due diligence and investigate the credit worthiness and reliability of any supplier via a variety of methods including ‘in-country’ technical visits, consulting with embassies, consulates and trade and investment offices, contacting international purchasing offices, etc.

These vetting methods can require considerable budgets, but companies can find budget-accessible tactics that work for them, and the amount paid for due diligence should be considered a worthwhile long-term investment in procurement systems.

2: Accepting hidden risks with samples

Requesting samples and making supplier decisions based on sample quality is a common course of action in procurement, but many companies make these common procurement mistakes with samples. Firstly, they do not have a clear process in place to ensure the sender is the actual manufacturer of the sample, and it is not another company’s product.

Some less-than-ethical suppliers  may send samples to potential customers which were manufactured by a third party and claim them as their own product. Therefore, it is better to get a sample from the production line during a technical visit.

Secondly, samples may be touted as having been tested by technicians. Even if this testing seems reliable, it’s important to have the samples independently tested in a laboratory and attach the test results to the contract to ensure future products will maintain the same quality based on measurable criteria.

3: Accepting an extraordinarily low price

If it seems too good to be true, it probably is. Uncharacteristically low prices are the first sign of cheating in international procurement, and yet, many companies make this procurement mistake and become victims of this tactic used by below-board suppliers.

If the quoted price is unbelievably low, procurement specialists should understand that something is wrong.

Often the scam will see the suppliers receive a part of the payment before delivery – and then they disappear.

4: No plan for product modification

Some SMEs buy the same product for a long period of time without any improvement or modification. There is always room for product improvement, but the buyer’s  feedback is essential. Many improvements can be made without  requiring significant additional costs and investments.

Examples of possible modifications include: product redesign, modifying technical characteristics, changing packaging, omitting additional features, and finished cost reduction. Over time, failing to update and improve the product or input will undoubtedly reduce your market competitiveness.

5: No clear plan for quality control

When buying from a foreign supplier, it is crucial to evaluate the quality of the product at the right time and place  by your own team or third-party inspection bodies.

The time and place of inspection can be during production, before delivery, at the main port or airport of shipment, or at the destination in your own premises.

The inspection test plan and detailed criteria and standard features of the product must be clear and attached to the contract.

6: Neglecting packaging details

Packaging is of high importance in any purchase, especially in foreign procurement. Packaging is essential for the shipping, protecting, and marketing of your products, but in many cases, SMEs do not negotiate and determine the details of packaging and assume that the supplier will take care of it.

Five aspects of packaging must be agreed upon between the supplier and buyer:

1. Type of packaging
2. Material
3. Specifications
4. Labeling
5. Marking

Even though the supplier is responsible for packaging in all Incoterms rules, it is necessary to discuss and determine all the related details in the contract to avoid ambiguity.

7: Trusting verbal promises

A majority of the earliest stages of business communications happen through non-written negotiations. Talking in a face-to-face meeting, phone calls, and online sessions are common steps in the purchasing process. Although all these communications are important and details of the agreement often need to be worked out verbally first,  one should never rely solely on these verbal agreements.

It’s crucial that you clearly document what has been agreed upon to avoid future misunderstandings.

One clearly written clause in a contract is better than a hundred pages of interpretation and explanation in the court.

8:  Neglecting intellectual property rights in contracts

Different aspects of intellectual property are important, and should be discussed in detail in most purchasing, manufacturing, and long-term supply contracts. Most North American companies invest a lot of money in research and development, and after designing a product, due to cost efficiencies, they may decide to outsource the manufacturing process to suppliers in other countries.

This opens up the risk that the supplier will infringe or tamper with the intellectual property of the buyer and manufacture and sell the same product to other companies.

It is essential to define the intellectual property details and determine the consequences of breach and misconduct in this regard. Two important elements of intellectual property which are at risk are industrial design and trademark. It is recommended to register the trademark and industrial design in the country of the supplier and also protect them in the contract between the supplier and buyer.

The importance of building a resilient supply chain has become a top issue for businesses with international reach.

Businesses of all sizes have been affected all around the world, from Ikea’s empty warehouses to bare grocery store shelves. This has exposed vulnerabilities in global supply chains and value chains.

We’ve seen the increasing international fragmentation of production processes and also the changes that they’ve had on the structure of global trade overall.

Simultaneously, the trade pressures for companies engaged in international trade to build supply chains with full traceability and accountability for social and environmental impact continues to build.

Companies are currently challenged to make their global supply chains more resilient without weakening their competitiveness in the marketplace.

We teamed up with our partners at OWIT-Toronto to host a webinar to discuss how this can be achieved. In this recap article we’ll go through some practical steps that small businesses can take to respond and act upon today’s supply challenges.

And we’ll also talk through how to set up strong supplier relationships and mitigation plans that will help to prevent disruption and delays.

Moderator:

Rashpal Uppal-Assi, CITP – Manager, Procurement Services Division, Town of Stouffville

Rashpal is a seasoned professional with expertise in supply chain management, international business learning design, and academia spanning over 15 years in serving public, private and non-profit organizations. She also founded her own strategic management consulting firm, working primarily with small and medium sized businesses and serves on the boards of three trade organizations.

Panelists:

Amesika Baeta, CITP – District Manager, GTA West, Export Development Canada (EDC)

Amesika manages a team of eight locally engaged account managers who work directly with Canadian exporters to offer knowledge, financing and risk mitigation strategies. She has 14+ years of experience in international trade and a proud CITP.

Maryam Fouladirad – Founder & CEO, fundii

Maryam has a wealth of international trade and development experience in the Middle East, Europe and North America. She received her MBA in London. She has experience in management consulting in FinTech, and the food and beverage manufacturing industries as well as direct trade in the U.S. with focus on entrepreneurship.

Lora Rigutto, CITP – Loyalty and Engagement Manager, Forum for International Trade Training (FITT)

Lora started her international trade career working for a foreign office trade commission based in Toronto. She brings experience from the procurement side for Canadian companies that are looking to procure from overseas. She is also a proud Certified International Trade Professional (CITP).

Let’s start by talking about today’s international supply chain environment – what are some of the challenges to be aware of?

Maryam: One of the main issues we’ve noticed over the past couple of years is logistics disruption. The labor shortages, the lack of proper raw materials for the manufacturers, and delays as a result.

So that’s a chain that impacted from A to Z, the supply chain workflow around the world that impacted everyone from the manufacturers, to the freight forwarding companies, to both public and private sectors and at the end, the final consumers.

Amesika: The key challenges that companies have faced have been the cost of inputs. This increase has been devastating in terms of understanding how they can price the costs. The increase in cost of inputs onto their customers while not hitting company’s margins has been a real challenge for companies.

The cost of shipping and freight has gone up by, for some of our clients, three times, four times, where what used to be $5,000 to send the shipment is now $25,000, sometimes $50,000.

Inventory management has been very challenging for companies to manage throughout this time, keeping up with the increased demand at the beginning in 2020 and 2021.

And now in 2022 we’re entering a different stage of the pandemic, consumer spending has gone back down. As a result, companies are managing an overstock of inventory and have to figure out how to get rid of all this product while not taking a hit.

And we’re also seeing the cost of financing rise due to the interest rate hikes, which will also have a huge impact on companies as we enter into 2023.

For businesses that are setting up new resilient supply chains, or modifying their existing supply chains, where should they start building in that resiliency?

Maryam: I often recommend three suppliers in every single market you are active in. And then you can prioritize them. Who is number one for you, number two and number three in terms of different products and the quality enterprises they have. These are the important points in selecting your suppliers and in negotiation.

Amesika: It starts with creating an export plan and then having a backup plan, and then sometimes even having a backup plan to your backup plan.

Through the process of creating an export plan you’ll assess your company’s financial position, human capital, the production capacities. Having a plan in place will be a great foundational work to help them determine what your needs are.

If you don’t have a plan, we see a lot of companies will end up spending frivolously because there’s no roadmap for them to follow.

And before all else, I encourage you to really understand your cash flow, understand your costs and how you’re going to finance this. Your suppliers may ask you for payment terms. You have to get the cash flow to pay them up front. And then, depending on the payment terms you have with your clients, your clients may pay you in 30 days, 60 days, sometimes 90 days.

Before you engage in these relationships, it’s really important for you to know how much you can afford to pay your suppliers, and how long you can wait to be paid from your clients. And that is a key component to the successful implementation of a supply chain system for yourself.

Maryam: Get all the information you can from Export Development Canada and the Trade Commissioners Service and their reports, but I highly recommend that all the business owners, as either an entrepreneur or SME, do your own research as well because it will really give you a better understanding regarding the market you’re expanding to. This is my recommendation, having a really good understanding regarding the market, and what has changed during the past two to three years due to COVID 19.

How should small businesses in particular approach finding new international suppliers to create a more resilient supply chain?

Lora: Let’s say you want to procure from a market and find foreign suppliers. Sounds so easy, right? But the truth is that you need a roadmap to do that. You need to become strategic about sourcing and procurement.

And learning to navigate through some of those complexities is what FITT can really help you with. FITT’s Global Value Chain course gives you a comprehensive look at supply chain management.  There are different units within that course that teach you what to look for when you’re searching for foreign suppliers. How do you do a cost-benefit analysis? How do you really determine what you can afford to pay for those goods and inputs?

If you want to embark on this journey you often need to upskill yourself.

Or if you don’t have time to learn a new skill set yourself, set your team up with the needed training to have the skills within your business to be able to do a proper cost benefit analysis.

If you go in blindly, often areas are overlooked. And let’s say you start to procure from a foreign supplier, but you don’t do your due diligence because you don’t know what to look for. Those mistakes can be really, really costly.

Amesika: As a small business, you can’t be everything, right? Doing the analysis of where your gaps are as a business will empower you to know where you can go to get help. And don’t forget that you can also lean into your community.

Whether it’s with a trade association or other friends that you have, leverage the relationships around you to get referrals.

Often suppliers are found through referrals, by speaking with people, going to trade shows, asking where people find products.

If you find a supplier from a Google search, you don’t know much about them, there might not be much on their website. But you can ask them to produce references for companies that they’ve worked with.

If you don’t have the budget to fly there to see their actual production, that’s one way that you can get around that. But honestly, if you want to save yourself a lot of headaches down the road, fly there to meet the companies that you want to do business with.

I know for a lot of small businesses don’t have the resources to do that, but there is a program called CanExport that’s run through the Trade Commissioner Service. It’s a government grant program that helps subsidize the costs of small businesses that are looking at entering into certain markets around the world. I highly recommend you look into that program to help you subsidize some of those costs.

Maryam: One of the best sources that Canadian companies can use to find suppliers is to contact the commercial section of the embassy of that foreign country in based in Canada.

That’s their job exactly, much like trade commissioners, helping Canadian companies to find their suppliers. They can also help you in translation if there is some sort of a language barrier or cultural issue.

Let’s talk about negotiating with suppliers – what are some pointers you can give for negotiating payment terms and contract details with suppliers?

Maryam: It’s an art, we need to develop it.

It’s all about how we can actually create a win-win situation for both parties as a supplier and also as an importer.

There are a lot of resources out there that you’ll want to tap into regarding the cultural ethics, the how to negotiate with different countries, what is important for them. Building trust is crucial, and another reason why flying to meet them in person can be so important.

But face time, even in online meetings is a good way to build trust with them. Do the work in vetting the supplier – ask for samples, test them, check their payment terms.

Negotiation skills also get better with practice. It’s a skill that people can learn. There are a lot of resources available, from Youtube to major universities, that teach negotiation skills. I would suggest people just watch those videos, give it time, practice it, see the result.

Amesika: You have to remember at the end of the day, you have to look out for your own company. I would always say this to my clients when I was an account manager; if somebody is looking to put food on the table, whose table are they going to put food on? They’re going to worry about themselves.

The best way that you can protect yourself is to be educated as much as possible.

Get the expertise. If you don’t have the expertise in a certain area, educate yourself to empower yourself to make the right decisions. Get good legal advice too. Make sure your contracts are well structured from the beginning and very clear in terms of who’s responsible for what.

Lora: You need to have confidence to go into negotiations, whether you’re negotiating with a potential buyer for your product or negotiating with a supplier.

Partner with your logistics provider or your freight forwarder, they have the expertise. Before you agree to a price that has an Incoterm, understand what that Incoterm really means to you and your obligations as a buyer.

It all comes back to being prepared. In a negotiation, if they’re quoting a certain term or a certain price with an Incoterm, you could be in a position to say, it’s the first time I’m dealing with you as a supplier, I’m not comfortable with buying “FOB”.

Understanding what your comfort zone is and, and understanding the different types of Incoterms, it’s all part of the negotiation.

If you don’t have the answers, partner with somebody that knows more than you do. And don’t agree to anything that you’re, you’re not comfortable with. Be willing to negotiate and have your reasons for not accepting that price with that Incoterm.

How can a small business without the resources of a large corporation diversify and create a more resilient supply chain?

How can they mitigate any risks and avoid disruption for their customers?

Maryam: Make use of all the help and resources available to you from the TCS, EDC, Business Development Bank of Canada (BDC) and the embassies. Go to trade shows and build your network, build those relationships.

Another really good source regarding Incoterms and finding the best route is freight forwarders and shipping companies. They know everything regarding Incoterms and they can be really helpful for entrepreneurs.

Amesika: EDC provides risk mitigation strategies. If you’ve got a company that you’ve never done business with before that’s emailed you, you’re worried about giving them payment terms, whether it be net 15, net 30, net 60 day terms, even net 90 in some cases.

It can be really scary as a small business, especially when you’re starting out or you’re building a new relationship.

But the reality of getting paid up front is just not possible for a lot of companies. EDC does offer a variety of insurance solutions to cater to what your needs are, depending on how large you are, and depending on the size of your contract as well.

We have an online insurance solution called select credit insurance, where you can go online, apply for a credit limit through our system, we will do a credit check on that company and then advise you as to whether we can insure that company or not.

You can get a quote from us and then determine whether you want to pay for the insurance or not. And there’s no minimum size. This is ideal for companies who have the occasional order here or there, in a small amount. And it’s a way to educate yourself.

Lora: I’ve been mentoring a company with an e-commerce model for the past nine months. And their biggest issue was shipping costs. My recommendation to them was to actually reach out to the small business solutions division of their courier.

No company is too small to be engaging in international business and there are so many organizations with resources that want to help small businesses export.

Most couriers have a small business solutions department, and they understand the unique challenges of small businesses. They have the tools and resources and can provide guidance on how to avoid some of the risks of the particular products that are being shipped or the products that you’re trying to procure.

Amesika: The more informed that you are, the more you are empowered to make the appropriate decisions for your company.

Especially in this time, being agile is fundamental to the success of your business. You’re going to have to shift and change.

It goes right back to the importance of having a plan and then having a backup plan for that plan, and most likely be prepared to change that plan again in six months or even a year.

While there are many risks inherent in international trade finance, there are also numerous methods of settlement in international trade available to exporters and importers to manage and mitigate risks.

In most developed countries, an organization can draw on a wealth of free or inexpensive expert opinions to assist with risk mitigation for financial transactions.

Major banks typically have large portfolios of international loan assets and maintain extensive international financial networks. To safeguard their interests and those of their customers, banks employ large staffs of political analysts and international economists, and are often willing to share their expert opinions and written reports.

Embassies and consulates abroad, as well as commercial officers, are valuable sources of political and economic risk information, and can refer their clients to local service providers abroad that can assist in obtaining more detailed information on commercial risks.

These resources can often provide information on a target country’s current business environment, as well as credit and business information about potential customers.

An organization should select the financial instruments that best address its needs and identified risks, as well as those that respond to the underlying dynamics of a commercial contract.

In general, importers and exporters must agree on terms and methods of payment based, in part, on the risks associated with planned transactions. Below you will find 4 methods of settlement in international trade you can use to reduce your risk.

Want to learn more about methods of settlement in international trade and other risk mitigation options? Check out the FITTskills International Trade Finance online course.

Risk Insurance

Businesses that engage in international trade can mitigate commercial risk and protect its interests through various forms of insurance, including:

• Political risk insurance
• Foreign accounts receivable insurance

Indeed, insurance options are available to address nearly every category of risk that suppliers and buyers could possibly encounter while conducting international commerce.

Political risk insurance (PRI) and accounts receivable insurance (ACI) are particularly common, and can be obtained from specialist private sector providers or, depending on the market, from public and private entities such as export credit agencies (ECAs).

Most ECAs were originally established as public sector entities that promoted exports by providing various financing and risk mitigation products and solutions.

In recent years, however, some of these organizations have been fully or partially privatized and have mandates that extend beyond their original public sector focus. In fact, just before the onset of the recent global financial crisis, many questioned the need for ECAs in international trade.

However, their critical value was demonstrated when the market collapsed and private sector providers retreated in panic. Variations on the ECA model continue to be numerous, with the approach and the scope of ECA-like organizations varying almost by country.

In any event, most ECAs continue to offer political risk insurance and foreign accounts receivable insurance, which are both important forms of coverage that can help exporters offset trade-related commercial risks. Some ECAs also offer medium-term buyer financing, which is another helpful tool for export promotion.

Risk Transfer

Many of the strategies mentioned in this section involve the transfer of risk from one party to another for a fee. Insurance, for example, transfers risk from an individual policyholder to a portfolio of clients managed by an insurer to disperse the risk among stakeholders whose premiums fund payouts against claims.

This usually occurs over time, as it is unlikely, under normal circumstances, that a material number of policyholders will present claims at the same time.

Another attribute of an organization that successfully mitigates and manages commercial risk includes the continual assessment of the relevant risks versus the associated costs of conducting global financial transactions.

For example, a very common loss suffered by exporters involves the commercial failure of the foreign importer, while, for importers, it is the failure or inability of the supplier to deliver the merchandise exactly as specified and when required. Sometimes, poor documentation will restrict or inhibit the export or import of merchandise.

Political and country risks account for a much smaller number of losses, but should also be considered when structuring a transaction.

The challenge for an organization trading internationally, whether importing or exporting, is to get to know and trust its foreign suppliers or importers and to balance this knowledge with the risk optimization tools available from a variety of sources.

An organization must then choose a form of settlement consistent with the assessed risk and its level of tolerance for that risk. The ongoing test will be to remain competitive—and commercially viable—while incorporating the risk of loss and the price of protection against such a loss, into the final price of the finished product.

Risk can also arise from factors beyond the good faith or control of the trading partners. If exchange controls are imposed by a government, the ability and willingness to pay is not sufficient to assure a successful conclusion to the transaction. The next section emphasizes the trade finance instruments which can be used to secure payment.

Learn about what impacts your cash flow and how to maximize it with this free FITTskills Lite resource. 

Open Account

Open account payments are essentially transfers of funds to the account of the exporter. Historically, open account payments have been used in trade between very stable and secure markets, such as the United States and Canada, or in intra-EU trade, and in cases where the trading relationship is established and trusted.

Open account payment terms are those under which the seller extends credit to the buyer, finances the whole sale and sends a standard invoice demanding payment within thirty to sixty days of receiving the goods.

In addition, terms are suitable for a very strong buyer-seller relationship with a creditworthy client. Much of the trade between Canada and the United States is done on an open account basis.

Trade on open account is also increasingly the preferred mode of payment across much of the globe.

This shift, driven by large global importers, introduces additional risk for exporters in that payment is affected after the delivery of goods and/or services, sometimes for as long as 90-120 days after delivery.

This method has some potential risks as the importer could, for example, become insolvent, or the country of import could experience political turmoil, preventing payment. In such cases, the exporter loses control, and usually title, to the goods and/or services and has limited recourse to recover payment.

From a documentation standpoint, aside from the commercial invoice that will be issued by the exporter in an open account transaction, this transaction normally also involves an ocean bill of lading (i.e. if ocean shipping was part of the agreed-upon terms and a shipping container of goods has been sent).

In these instances, the exporter will usually send all original copies of the ocean bill of lading (i.e. those issued by the shipper as receipt for the goods) to the buyer. The ocean bill of lading serves as the title to the goods so, upon receipt, the buyer (or the buyer’s designate) can present an original copy of the ocean bill of lading at the receiving port to get the shipment released.

Note that, in certain circumstances, it is possible for the exporter to authorize a release of the goods without an original copy of the ocean bill of lading. However, many exporters still rely on the courier to deliver original copies of the ocean bill of lading to the importer to prevent an unintended and unsecure release of the goods.

Payment in Advance

One of the methods of settlement in international trade not yet mentioned is payment in advance. In contrast, payment in advance (advance payment) is a payment that is made before receiving the good or service, so it presents the highest risk to the importer (i.e. given that the exporter could easily receive the funds and not carry through with the promised shipment).

Exporters sometimes require advance payments by importers as protection against non-payment or to purchase supplies to fulfill the order. Higher advance payments may be required for specialized products as a hedge against buyer default when it may be more difficult or impossible to sell the products to a another buyer.

If an importer wanted to have a pre-shipment inspection when paying cash in advance, he/she could hire a 3rd-Party Inspection service to visit the manufacturer and file an inspection report.

However, the cost of such an inspection would also add to the investment being made by the importer. So the credibility of the exporter in this sort of a scenario would typically have to be very high.

Even with the best intentions and good faith, factors such as political turmoil and other unforeseen events could prevent a willing and well-intentioned exporter from completing a shipment as promised.

As a result, payment in advance is rarely used for transactions that are structured on a recurring basis. However, advance payment is frequently used when the reputation of the exporter is well-established and the importer sees little risk in an advance payment.

Advance payment establishes the importer’s credibility when the exporter does not have sufficient confidence in the importer. In these situations, the initial payment in advance transaction is used to gain the confidence of the exporter, and it is often accompanied by negotiations that are intended to lead to better payment terms on subsequent transactions, such as open account, as described above, or documentary collections.

By now we’ve all experienced the effects of supply chain disruption that began with the pandemic in late 2019/early 2020. Between worker shortages, inventory shortages, high costs, long wait times and unpredictability, the challenges, for those doing business across borders especially, have been incredibly difficult to manage.

As part of Startup Global (Startup Canada’s annual  program empowering founders to start their business with a global mindset) FITT teamed up with them for this fascinating and informative Twitter chat on how to build a resilient supply chain – no easy task.

We brought 6 CITPs on board to share their knowledge and experience, and the insights were too great to limit to Twitter. So for those that missed it live, here are the conversation highlights.

CITP Panel:

• Greg Gerritson, CITP, Global Logistics and Trade Compliance Manager at Phoenix Technology Services
• Rahim Mohtaram, CITP, Supply Chain Management Program Coordinator at triOS College
• Audrey Ross, CITP, Trade Compliance Specialist at Orchard Custom Beauty
• Clarecia Christie, CITP, Professor International Business, Marketing and Management Studies at Algonquin College
• Igor Chigrin, CITP, Senior Business Advisor, International Expansion at
  BDC
• Veronica Abella, CITP|FIBP, Bachelor’s Degree in International Business

In your own business or as a customer of a business, what was your biggest supply chain challenge?

The biggest supply chain challenges nowadays are various risks (political, currency exchange rates, shutdowns, delays), cost pressure (raw material and energy costs, logistics freight,), and digital transformation requirements. #StartupChats

— Rahim Mohtaram (@RahimMohtaram) May 25, 2022

A1 – adjusting to
1) the new timing, ex. no more last minute bookings, have to book ocean 5 weeks in advance. Ports taking waaaayyyy longer to offload.
2) the amount of chasing! Nothing is on track, every project constantly monitored. #StartUpChats pic.twitter.com/WPxHAFrIx4

— audrey ross citp|fibp (@tresAudrey) May 25, 2022

#StartupChats #CITP pic.twitter.com/Q4nOuSgmXr

— FITT (@FITTNews) May 25, 2022

When it comes to international business and your supply chain, how can you protect yourself?

A2 – Understanding true “landed costs” and associated supply chain intricacies within your business. #startupchats

— Greg Gerritsen (@greg_gerritsen) May 25, 2022

A2 From B2B perspective there are a number of risk mgmt tools to tap into such as export credit insurance, maritime insurance, inventory loss insurance, etc. @FITTNews #StartupChats

— Clarecia Christe CITP ?? (@ClareciaChriste) May 25, 2022

Ensure your contracts & documents are accurate, precise and compliant.
Now is the time to get super detail-oriented bc you cannot afford the extra charges for storage or delays.
Control what you can control – the precision of your paperwork. #StartupChats

— audrey ross citp|fibp (@tresAudrey) May 25, 2022

Selecting reliable suppliers, early involvement of professional 3PL service providers, cargo insurance (Clause A plus war & SRCC), hedging, redesigning supply chain network, nearshoring or reshoring mixed with offshoring. #StartupChats

— Rahim Mohtaram (@RahimMohtaram) May 25, 2022

Let’s talk about Incoterms. What are they and how do they help entrepreneurs mitigate risk?

They regulate where the costs and risks transfer between the buyer and the seller in the international shipping transactions. So, you need to know incoterms to know when you start being responsible for the loss or damage of the goods in transit. #StartupChats

— Igor Chigrin (@winglobal_igor) May 25, 2022

The @iccwbo #Incoterms® rules are used in contracts to clearly communicate the obligations, costs, and risks associated with the transportation and delivery of goods, providing clarity for sellers and buyers and helps facilitate trade.
Learn more: https://t.co/Rs0PAq4F2n

— FITT (@FITTNews) May 25, 2022

Understanding INCOterms is crucial in import / export biz. Obvi, you want to choose the one w/ most advantage to you… but then you have customers & DDP is a real value add. You just have to ensure (& insure!) you plan for the costs & risks involved. #StartupChats

— audrey ross citp|fibp (@tresAudrey) May 25, 2022

What problems are small businesses currently facing when taking their business internationally and exporting to new markets?

Recruiting experienced traders, finding a practical method for selecting the right target markets, finding a suitable and reliable agent, distributor, or partner in the target market, negotiating and drafting a comprehensive contract, and logistics coordination. #StartupChats

— Rahim Mohtaram (@RahimMohtaram) May 25, 2022

Finding and marketing to the right buyers or customer segments is also a problem, on top of all others. #StartupChats

— Igor Chigrin (@winglobal_igor) May 25, 2022

High costs! Freight rates being just one example.#StartupChats #SupplyChain #SME #CITP pic.twitter.com/jrxHreNlsJ

— FITT (@FITTNews) May 25, 2022

A4 Understanding industry regulations of international markets which affects their goods accessing the market, using incorrect HS Codes, assuming an homogenous culture, not using a customs broker. @FITTNews #StartupChats pic.twitter.com/1CxbSojCJP

— Clarecia Christe CITP ?? (@ClareciaChriste) May 25, 2022

A4. Generally what I see is an assumption that conditions, market and regulations will be similar to the home country. Not doing your homework. Also- – not bringing on paid advice (legal, financial, trade compliance) early enough. #StartupChats

— audrey ross citp|fibp (@tresAudrey) May 25, 2022

A4- Marketing plan (online?), Financing (distribution, landed costs) and reverse logistics (returns/damages, customer service). #startupchats

— Greg Gerritsen (@greg_gerritsen) May 25, 2022

The pandemic has clearly shown the interconnectedness of our global supply chains. How do you navigate difficult conversations between all your different stakeholders?

Having a long-term view, creating cross-functional teams, early involvement of customers and suppliers in projects, honest and open negotiation and creative problem-solving technics, and strategic cooperation with preferred partners. #StartupChats

— Rahim Mohtaram (@RahimMohtaram) May 25, 2022

A5. Have them early and come with solutions.
It is a reality that you will not always have awesome convos with your customers. Be responsible, honest and get it over with so you can move forward together. #StartupChats

— audrey ross citp|fibp (@tresAudrey) May 25, 2022

A5 – Being aware of cultural and business process differences in different regions and educating yourself so to have productive dialogue to overcome challenges, and help achieve goals. #startupchats

— Greg Gerritsen (@greg_gerritsen) May 25, 2022

A big part of being resilient is having a support system and strategies to overcome hard times. For supply chain issues, what might this look like for entrepreneurs?

A6 As we are in the #digitalage Entrepreneurs have new tools to use tracking shipments and communicating with 3PL partners; her the use of AI, Blockchains is playing a big part in managing some supply chain issues @FITTNews #StartupChats

— Clarecia Christe CITP ?? (@ClareciaChriste) May 25, 2022

A6. It’s connections and knowing who is in the community. @Startup_Canada @FITTNews @wekh_pcfe @ExportDevCanada @TCS_SDC , Chambers of Commerce, @OWITintl etc. #StartupChats

— audrey ross citp|fibp (@tresAudrey) May 25, 2022

A6 – Relationships with trusted experts and resources who understand your vision and business. #StartupChats

— Greg Gerritsen (@greg_gerritsen) May 25, 2022

Knowing the impact supply chain issues have had in the past few years, will you structure your team differently in the future? Who can help entrepreneurs tackle these challenges?

A7. If you haven’t already adopted some digital tools and moved away from excel spreadsheets – the time is now.
Also- you can’t copy & paste someone else’s supply chain design. We all tried copying toyota JIT model… #StartupChats

— audrey ross citp|fibp (@tresAudrey) May 25, 2022

Yes, We need cross-functional and cross organizational teams including all links in our supply chain, from third-tier suppliers to end-users. @FITTNews, @StartupsCanada, and @ExportDevCanada can help with their professional advice. #StartupChats

— Rahim Mohtaram (@RahimMohtaram) May 25, 2022

A7 first the entrepreneur must know the trade ecosystem and the players, budget for paid professional advisors such as CITPs @FITTNews in the business and hire great custom brokers, freight forwarders, etc. #startupChats

— Clarecia Christe CITP ?? (@ClareciaChriste) May 25, 2022

I’d say that a good freight forwarder can make a difference. They are not all equal. #StartupChats

— Igor Chigrin (@winglobal_igor) May 25, 2022

A7 – Talented CITP certified staff! #StartupChats

— Greg Gerritsen (@greg_gerritsen) May 25, 2022

What are some strategies you can adopt to make sure your customers remain happy even if there is a delay with shipments and product delivery?

Being proactive, considering pessimistic transit times, managing expectations when signing contracts, being realistic and honoring promises, clear and fast communication and explanation, increased visibility by online tools, hard work, and honesty. #StartupChats

— Rahim Mohtaram (@RahimMohtaram) May 25, 2022

A8 Bring customers in the supply chain journey with you with tracking technology, be transparent and realistic on arrival times, provide complementary services e.g. inventory management software, future discounts, etc. #StartupChats @FITTNews

— Clarecia Christe CITP ?? (@ClareciaChriste) May 25, 2022

A8. Over-communicate, provide them expectations in advance and sometimes you have to throw in a “we’ll cover the expedited delivery cost for this one!”

— audrey ross citp|fibp (@tresAudrey) May 25, 2022

A8 – Real time tracking and tracing, and visibility of your goods in transit. Regardless of mode, air (courier or heavy freight), land or Ocean. #StartupChats

— Greg Gerritsen (@greg_gerritsen) May 25, 2022

Yep! There will be a quiz later! https://t.co/AOYkY90git#Incoterms2020 pic.twitter.com/kVfQHsjQHn

— FITT (@FITTNews) May 25, 2022

Learn more about Startup Canada’s Startup Global Portal.

Don’t forget, once you register, you can access several FITT presentations, workshops, videos, and even a discount on FITTskills training.

When trading goods across international borders, the period of transit has a high level of risk because goods are moving and may be handled by several stakeholders.

There is also a high cost of liability should anything happen to a shipment of goods. Transport documents provide a record of the movement of goods and who is responsible for the goods at any point during time in transit. Sometimes these transport documents are referred to as cargo control documents.

Transport documents ensure safe, secure, and timely transit of goods across borders. They vary depending on the mode or modes of transport being used, what is being shipped, and where it is being shipped. As a result, there are many variations, and combinations of transport documents.

In this article we’ll focus on Bills of Lading (BOL, B/L), a key, legally binding piece of documentation issued by carriers.

They serve three purposes:

1. Define the contract of carriage of the goods from the point of origin to the point of destination, according to the responsibilities of the service provider listed on the bill of lading
2. Act as a receipt for the goods delivered to the carrier for shipment
3. Provide evidence of title for the goods

A bill of lading is therefore a contract between a shipper and a carrier for the transportation of goods to the destination named in the contract.

What’s included on a bill of lading

The information specific to a particular transaction appears on the face of the bill of lading and should include:

More information may be required depending on the mode of transportation, or if other modes of transportation are required (e.g. through bills of lading or inter- or multimodal bills of lading), and if the bills of lading are negotiable or not.

The general terms and conditions of the contract, including the carrier’s responsibilities and liabilities for loss or damage to the shipment, usually appear in fine print on the reverse of the document. Carriers have their version of a bill of lading for the shipper. The clauses on the back of bills of lading set the limits of liability and specify carrier exemptions. These terms and conditions are regulated by domestic legislation and the international conventions applicable to each mode of transport.

Terms and Conditions clauses typically include:

Want to learn more about managing your company’s supply chain and logistics to mitigate risks? Chech out the FITTskills Global Value Chain online course!

Other types of clauses relate to specific types of cargo such as live animals and dangerous goods.

The many different types of bills of lading

As  with  any  contract,  the  terms  of  carriage  need  to  reflect  the  needs  of  the  shipper  with  regards  to  care  of  the  cargo,  the  degree  of  risk, and  the  cost  of  transportation.  It  is  important  for  the  shipper  to  understand  the  terms  and  conditions  that  outline  the  responsibilities  of  the  owner  of  the  goods  and  the  owner of the shipping vessel.

Liability is not usually open-ended or automatically set at the value of the goods, but can be limited by a formula applicable only under certain conditions. There is no uniform maximum limit of liability applicable to all modes of transport.

Each mode of transport has its own bill of lading, governed by its specific regulatory legislation or international convention, and therefore has its own limited liability.

When the shipper accepts a bill of lading, they acknowledge that the contract includes the terms printed on the document. There may be two or more originals issued depending on what is needed for the financial transaction, or the terms and conditions of the sales agreement/contract.

A bill of lading is required as legal proof of ownership should the shipper or consignee enter into a dispute with the carrier, the insurance company, or each other.

A negotiable bill of lading is usually required for letter of credit or documentary collection payment arrangements. Negotiable bills of lading can be bought, sold, traded, or used as collateral for borrowing money. It signifies ownership of the goods. It is very important for the consignee to ensure they have all the original forms of the bill of lading.

The expression bill of lading originated from the movement of goods by sea. Because of this origin, the term generally applies to the movement of goods over oceans and seas. However, there are many types of bills of lading and variations in terminology to address the many types of cargo carriage.

Bills of lading can reflect the type of carriage being used to ship the goods in addition to a marine vessel (e.g. rail, road, and air). It can reflect the condition of the cargo (e.g. clean, soiled), the conditions of shipping (e.g. on deck, under deck), and the conditions of financial requirements. They can also be arranged to reflect the use of a number of carriers or a single carrier, the use of a variety of transportation modes, and a carrier with cargo from a number of shippers. Bills of Lading are often abbreviated as B/L or BOL.

Types of bills of lading that can be issued by a carrier

Ocean/Maritime/Port to Port bills of lading are used when freight travels internationally over an ocean or sea. They are generally considered most important due to the distances covered, time frames, and size and value of shipments. Information includes the name of the party to be notified at the time when the shipment arrives or is unloaded at the point of destination.

Straight bills of lading are used when goods are already paid for and being shipped directly to the customer and is non-negotiable.

“To order” and “blank to order” bills of lading are used when goods have not been paid for and the bill of lading is proof of ownership. This form of B/L is negotiable, i.e. can be bought, sold, and used for collateral before goods have arrived at the point of destination.

Short-form bills of lading are shorter versions of straight bills of lading; only lists the most important terms and conditions, but the regular terms and conditions do apply whether stated or not. Can be issued for all three modes of transport.

House bills of lading are used by freight forwarders for consolidated shipments of goods from different shippers. Will consist of all the B/Ls for each shipper participating in a consolidated consignment. These B/Ls are not negotiable.

Mode of transport-related bills of lading

Some bills of lading are related to the modes of transportation or number of carriers involved in getting a shipment to its destination, for example:

Direct bills of lading are used when the same vessel picks up the shipment and delivers it to its final destination.

Intermodal bills of lading are used when a shipment uses several different carriers for different segments of a shipment’s journey to the final destination, but do not consolidate the terms and conditions or responsibility of the carriers. Each carrier is responsible for their leg of the journey under the terms and conditions of their own bill of lading.

Multimodal/combined transport bills of lading are used when one carrier assumes responsibility for the shipment over several different carriers with the same terms and conditions applying to all the carriers.

Inland bills of lading allow shipping carriers to transport shipments by road or rail but not by sea.

Through bills of lading allow shipping carriers to transport shipments using several different modes of transportation and/or distribution centres.

Charter party bills of lading are used when shippers use chartered vessels instead of named carriers to transport their shipments.

In 2001, As a student in the Customs Clearance bachelors’ program, Rahim Mohtaram began his journey in international trade with an internship in the most important port in Iran. This experience made him sure that international trade, logistics, and business negotiations were paths that he wanted to pursue throughout his life. It wasn’t long before he finished his MBA at the University of Tehran in 2006 and started his first job at a customs brokerage company.

As is the case with many young, hard-working individuals in international business, Rahim worked in various departments and organizational levels, learning a lot about international trade activities along the way. Specifically, he learned the ins and outs of business negotiations, cargo insurance, multimodal transportation, documentary credits and collections, compliance, and customs clearance formalities. Eventually, in 2014, he took on a supply chain and procurement position at a trading company, garnering even more experience to bolster his knowledge and career. Clearly, his initial instincts about his future in trade were correct.

Exciting travels, contracts, and negotiations

It’s no surprise that travel has been plenty during Rahim’s career, bringing him to more than 10 countries and countless exhibitions as a chief negotiator. These travels have become more compact too, including a three-day journey to China, two days on a plane, and a one-day negotiation meeting.

Despite the demanding schedule, he enjoyed so much of his work, gathering many favourite stories from his travels, including one that took place in China:

“One of my most memorable experiences was a five-day trip to China, in which I negotiated with 7 companies in seven different cities, from Shanghai to Guangzhou. My team and I drafted and signed 4 contracts during those five days, and it was an amazing experience. Business Travel with a professional team is the best way of learning skills in international trade and business negotiations.”

Putting knowledge into action to help businesses around the world

Rahim has merged his lengthy experience and knowledge to help many companies to handle their international business. Since 2006, he’s:

• negotiated and implemented more than 160 international contracts for various products
• worked with companies from more than 25 countries in different industries
• trained more than 6000 people in large and small companies
• published 13 practical books about international trade

These books cover many trade-focused topics, such as customs clearance procedures, cargo insurance, international transportation, international payments, and international business letter writing. He has also guest authored a TradeReady blog on discount strategies and appeared in several FITT events as a panelist.

Experience that leads to sage advice

With so many experiences, Rahim has become exceptionally seasoned in international trade, offering up plenty of sage advice to his colleagues:

“My advice to anyone who wants to improve his/her skill in international trade is to work at customs brokerage or logistics companies for a while. You can gain valuable experiences in different industries and about different products in a short time. In a single day, you must handle challenges about a wide range of products, and after a few months, your knowledge and experience will be extraordinary.”

Want to learn more about the Certified International Trade Professional (CITP®|FIBP®) designation? See why it’s the world’s most recognized designation for competency and credibility in global business.

Adding credibility to experience and expertise with the CITP designation

Understanding the importance of expanding his credibility and professionalism in the field, Rahim decided to pursue his CITP through the Executive Path in 2021. His reasons for doing so were simple:

“I selected the Certified International Trade Professional designation, simply because I believe it is the best option available. The CITP is the world’s most credible and recognized designation in international trade, and it helps me to add value in my services to my customers. I am thrilled to be a CITP, because, after 15 years of hard work, my expertise is now validated by the most credible international trade entity in the world.”

Where the CITP designation will take him

Now, as an accomplished international business professional, Rahim is teaching, consulting, and coaching businesses on how to do business the right way. He believes that the CITP designation will open new windows for him, improving his credibility as an experienced consultant and coach, allowing him to help more companies achieve their goals in global markets.

Already successful within the field and ever-hungry to achieve more, we know that Rahim will be a face to watch for in the international business ecosystem for years to come.

Warren Senkowski began his career in international trade back in 2016, when he became a Trade Commissioner in the Pacific Regional Office for Global Affairs Canada in Vancouver. Throughout his career, he’s learned much about the different industries related to trade, and currently, helps companies expand into international markets with a focus on infrastructure and wood products. 

Being part of the resurgence of wood as a structural building material 

Warren has many favourite stories about his work with Global Affairs Canada, but chief among them are his experiences working with the Vancouver Economic Commission and wood industry associations to promote mass timber and tall wood buildings to an international audience. He notes:

“Seeing the resurgence of wood as a structural building material for high-rise buildings thanks to advocacy and changes in regulations has been fascinating. It is also considered a green building product due to being a carbon sink, and British Columbia offers the full range of products and services to supply tall wood buildings to the world.”

Throughout his work, Warren has not only highlighted the benefits of wood products to the world but he’s also been able to network with CEOs and high-level government officials, connecting his clients to international projects and opportunities they otherwise wouldn’t have known about. “Watching small businesses grow and succeed on a global scale is a point of pride for me,” he says. 

Learning from those with experience 

After many years of working in international trade, Warren has some great advice for those just starting out. 

“Schedule more one-on-one meetings with colleagues and clients that have more experience than you in a particular sector or geographic region to learn about it.”

These practices have served him well throughout his endeavors to encourage the country’s international trade initiatives.

Gaining a deeper knowledge of international trade with the FITTskills courses 

Warren wanted to deepen his knowledge of international trade by understanding all the factors that need to be considered at every step of the export journey. To do so, he began taking FITTskills courses finding them to be beneficial to his work in many ways: 

“The courses were very well written, clear and easy to understand. They have given me better discussion topics to raise with clients that are beginning to export.”

He also had a favourite course: “I found the Global Value Chain course a great learning experience since I wasn’t aware of Incoterms and will definitely use this knowledge in the future.” 

Learn how to effectively manage your business’s supply chain and logistics with the FITTskills Global Value Chain online course.

On becoming a CITP 

Warren applied for his CITP designation in 2021, achieving it in February of the same year. He believes it will give him a broader toolkit with which to serve companies and new perspectives for analyzing problems and developing solutions. 

Of this accomplishment, he says: “I am happy to have reached this milestone.”  

With so many accomplishments already, we know that this is only one of many successes in a future filled with international trade achievements.  

Emmanuel Asafo Adjei’s career in international trade has been an evolution. After earning a post-graduate degree in International Business from Fanshawe College, he worked for seven years as operations coordinator for a Canadian Military Defense contractor. To further grow his career, he went on to earn his Master’s of Geography from the University of Western Ontario.

Like many, Emmanuel was faced with new challenges due to the COVID-19 pandemic. While working as an engineer, he was charged with coordinating global supply chains, a task that required fostering new business relationships. That role led him to sharpen and improve his international trade skills.

Working with and leading teams to seal international trade deals

Throughout his career, Emmanuel has worked with colleagues and trade partners to open supply chains and improve processes. He has collaborated with highly trained engineers and supply chain experts on the acquisition and distribution of Canadian government military assets around the globe. He’s also led a state-of-art materials requirement planning system (MRP) to enhance just-in-time production processes.

“It has always been refreshing to negotiate international deals with the knowledge of Incoterms,” he noted.

Understand the latest edition of Incoterms® with The Incoterms® 2020 online course, presented by FITT and the Canadian Chamber of Commerce (CCC).

Celebrating accomplished trade deals and improved processes

In his work in international trade, Emmanuel has seen many successes. They include managing more than $100 million in inventory assets in one of southwestern Ontario’s largest warehouse facilities, facilitating and auditing shipping documents while ensuring that shipments met international standards, and building quality control and international trade databases that reduced audit time and paperwork by more than 80 percent. He also led the consolidation of two mega warehouses into a 500,000-square-foot facility without significantly impacting workflow during the three-month process.

In his latest venture, Emmanuel is working on farming the superfood tiger nuts in Africa for import into Canada. He’s packaging and distributing the superfood into niche food stores in Canada and the United States.

Through his career and FITT studies, Emmanuel has also learned the importance of perseverance:

“Never give up on any goal you set for yourself. There may be challenges, but they all pass away and give way to your success eventually. One of my proudest moments was getting my FITT diploma after leaving it for almost a decade.”

Gaining a better understanding of imports and exports

With his FITT coursework, Emmanuel earned a deeper understanding of the nuances of food imports, packaging, and distribution in Canada and the United States—knowledge that has proved extremely valuable as the owner of a food import business. FITTskills have helped him better understand importing goods, working with Canadian customs, the Canada Food Inspection Agency, Canada Revenue Authority, Port Authority, and import brokers.

Broadening perspectives on new markets

Emmanuel’s FITTskills courses—such as the International Trade Finance course—gave him insight into working with global clients, suppliers, and customers, along with expanding his global literacy and inter-cultural awareness. They’ve also helped him see future opportunities in trade.

“I chose the  CITP designation to consolidate my skills sets in international business and to be an asset to companies that may want to expand into developing markets, especially in Africa.”

“My motivation has broadened to include the many growth opportunities with Africa’s 1.3 billion-person market, now one of the largest free-trade areas in the world. With the African Continental Free Trade Area (AfCFTA) agreement signed by its 55 countries—and the projected $2.2 trillion GDP—Canada cannot ignore this huge market.”

Manage your cash flow and mitigate financial risk by selecting appropriate transaction methods and tools for international trade activities with the FITTskills International Trade Finance Course.

The power of great teachers and courses

Emmanuel was lucky to learn about the CITP designation through a call with two of his Fanshawe college professors: Albert Knab and Morgan Murray.

“They both sowed the seed of grit and perseverance in me as an immigrant,” he noted, stating that they were an important part of spurring him to push full steam ahead with his courses and his career.

With so much accomplished already, we can’t wait to see what’s in store for Emmanuel next!