Shipping and Payment Methods

Delivery and Payment Methods in Export are examined under several different headings. In general, the responsibilities of the parties to each other differ in all payment methods. The responsibilities and risks that different payment methods impose on You or Tughan Textile also differ.

As Tughan Textile Payment Method: It works with the Prepayment / Advance Payment method. After the necessary agreements are made, your order is put into production with a 70% prepayment. The remaining 30% payment is requested upon delivery. It is the system that is valid for all orders both in Turkey and abroad. Payment by credit card is an alternative payment method used only for orders from Turkey. It works in the same system as cash payment and Virtual Pos is used. A link is sent to you for payment.
As Tughan Textile Shipping Method: DELIVERED DUTY PAID (DDP) provides the delivery of your products to you using all loading methods. (Customs and Import Costs are always the responsibility of the customer.)

Methods of Delivery in International Trade: In international trade, it is important to clearly define the obligations of the customer and the seller, such as where the goods will be delivered, who will bear the costs or how they will be shared, whether insurance and transport contracts will be made. One of the helpful helpful resources in this regard is INCOTERMS (International Commercial Terms) published by the International Chamber of Commerce (ICC). INCOTERMS is a set of internationally accepted rules used in contracts between the customer and the seller, showing the responsibilities of the customer and the seller.

The latest INCOTERMS 2010 has been published by the ICC. Accordingly, there are 11 delivery methods in international trade and they are divided into two classes.

- Rules covering all transport types: EXW, FCA, CPT, CIP, DAT, DAP, DDP

- Rules specific to sea and inland water transport: FAS, FOB, CFR, CIF

EX WORKS (EXW): In this form of delivery, Tughan Textile delivers the goods in its own place or at another named place (factory, warehouse, workplace, etc.) at the disposal of the Customer. Tughan Textile is not obliged to load the goods on any transportation vehicle. From the moment of delivery of the goods, all costs and risks related to the goods are borne by the Customer. In this form of delivery, there is a minimum obligation for Tughan Textile. Since the invoice will be issued, you have to pay 8% VAT.
FREE CARRIER (FCA): In this form of delivery, Tughan Textile delivers the goods to the carrier or another person appointed by the Customer, at the workplace of Tughan Textile or at another designated place. In this form of delivery, Tughan Textile must complete the export customs procedures of the goods, at its own expense and damage. From the moment of delivery, all costs and risks related to the goods pass to the Customer.
FREE ALONGSIDE SHIP (FAS): In this form of delivery, Tughan Textile delivers the goods at the designated loading port, in the direction of the ship chosen by the Customer (for example, on a quay or on a barge). If the goods are at the ship's dock, by loading them; If the ship is moored in the open, it is delivered by barges to the side of the ship. Damages and costs related to the goods pass to the Customer when the goods are left in the direction of the ship, and the Customer bears all costs from this moment on. Tughan Textile obtains all kinds of export permits or other official permits required for the export of the goods, at its own expense and damage, and completes the necessary customs procedures for the export of the goods.
FREE ON BOARD (FOB): In this form of delivery, which is the most used in our country; Tughan Textile delivers the goods at the designated loading port, on the ship chosen by the Customer or in the specified manner. Damages and costs related to the goods pass to the Customer when the goods are on board, and from this moment on, the Customer bears all costs. Tughan Textile obtains all kinds of export permits or other official permits required for the export of the goods, at its own expense and damage, and completes the necessary customs procedures for the export of the goods.
COSTS AND FREIGHT (CFR): In this form of delivery, Tughan Textile delivers the goods on the ship or supplies the goods already delivered in this way. Damages and costs related to the goods pass to the Customer when the goods are on board. Tughan Textile, at its own expense and damage, obtains all kinds of export permits or other official permits required for the export of the goods and completes the necessary customs procedures for the export of the goods. Tughan Textile makes a carriage contract to bring the goods to the designated port of destination and pays the costs and freight.
COST, INSURANCE AND FREIGHT (CIF): In this form of delivery, Tughan Textile delivers the goods on board or supplies the goods already delivered in this way. Damage and costs to the goods pass to the Customer when the goods are on board. Tughan Textile, at its own expense and damage, obtains all kinds of export permits or other official permits required for the export of the goods and completes the necessary customs procedures for the export of the goods. Tughan Textile makes a carriage contract to bring the goods to the designated port of destination and pays the costs and freight. Tughan Textile also makes an insurance contract against the risk of loss and damage to the goods during the journey of the Customer.
CARRIAGE PAID TO (CPT): In this delivery form, Tughan Textile delivers the goods to the carrier that he has chosen and made an agreement with, customs procedures related to the export of the goods have been made, the transportation contract has been made for the shipment to the specified destination and the transportation costs have been paid. . Tughan Textile, at its own expense and damage, obtains all kinds of export permits or other official permits required for the export of the goods and completes the necessary customs procedures for the export of the goods.
CARRIAGE AND INSURED PAID TO (CIP): In this form of delivery, Tughan Textile delivers the goods to a carrier or other person chosen by him at the designated place and Tughan Textile makes the necessary transportation contract to bring the goods to the specified destination and covers the transportation costs. pays. Tughan Textile, at its own expense and damage, obtains all kinds of export permits or other official permits required for the export of the goods and completes the necessary customs procedures for the export of the goods. Tughan Textile makes a carriage contract to bring the goods to the designated port of destination and pays the costs and freight. Tughan Textile also makes an insurance contract against the risk of loss and damage to the goods during the journey of the Customer.
DELIVERED AT TERMINAL (DAT): In this form of delivery, Tughan Textile delivers the goods at the designated destination or port as unloaded from the incoming transport vehicle at the designated terminal and at the disposal of the Customer. The term terminal covers any place that can be covered or covered, such as a quay, warehouse, container yard, or road, rail or air cargo station. Tughan Textile, at its own expense and damage, obtains all kinds of export permits or other official permits required for the export of the goods and completes the necessary customs procedures for the export of the goods. Tughan Textile makes a carriage contract to bring the goods to the designated port of destination and pays the costs and freight. Tughan Textile also undertakes all damages and expenses related to bringing the goods to the designated destination or port and unloading them from the transport vehicle.
DELIVERED AT PLACE (DAP): In this form of delivery, Tughan Textile delivers the goods at the designated destination without unloading them from the incoming transport vehicle, at the disposal of the Customer. Tughan Textile undertakes all damages and costs related to the arrival and fulfillment of the goods. Tughan Textile, at its own expense and damage, obtains all kinds of export permits or other official permits required for the export of the goods and completes the necessary customs procedures for the export of the goods. Tughan Textile makes a carriage contract for the transportation of the goods to the designated delivery place, if any, to the agreed point, at its own expense. Tughan Textile undertakes all damages and costs related to the delivery of the goods to the designated destination.
DELIVERED DUTY PAID (DDP): In this form of delivery, Tughan Textile delivers the goods as cleared for import and ready to be unloaded in the transport vehicle at the designated destination, at the disposal of the Customer. Tughan Textile undertakes all the damages and costs related to the delivery of the goods to the designated destination, is obliged to carry out customs clearance not only for the export but also for the import of the goods, to pay all necessary fees for export and import, and to fulfill all customs formalities. There is a maximum liability for Tughan Textile.

International Payment Methods are generally listed as follows:

Cash Payment / Cash Before Delivery
Cash Against Goods
Cash Against Documents
Acceptance Credit
Letter of Credit (Letter of Credit)

Prepayment / Advance Payment: In the advance payment method, the importer company has to pay the price of all the goods to the importer company after the agreement is made before the goods are received. The payment method in which the entire payment is made directly before the goods are shipped is called advance payment. In the advance payment method, all transportation risks such as accidents and loss of goods that may occur during the transfer of the goods, as well as the delivery times of the goods belong to the importer company. Since all risks in the payment method and goods transfer are on the importer company, it is a payment method that is not preferred very often today.

Cash Against Goods: In the cash against goods payment method, the exporter firm must first send the goods and these goods must reach the importer firm. After the exporter company delivers all of the goods to the shipping company, it also sends the documents representing the goods to the importer company that the goods have been delivered. After the goods are received by the importer company, the payment for the goods must be made. After the shipment of the goods is completed, the importer company can pay the exporter company directly or through the bank as a payment method. Contrary to cash payment, in cash against goods payment method, all risks including goods transfer and payment are under the responsibility of the exporter company. For this reason, it is not preferred very often nowadays.

Cash Against Documents: The payment made in accordance with the sales contract between the importer and exporter firm is called the payment against documents. In payment against documents, the exporter company delivers the total cost of the goods to the importer company through the bank, in return for payment or a policy or bond, of the shipping documents representing these goods, after all the goods shipped by the importer are received. In the payment method against documents, the payment is made after all of the goods reach the exporter firm. However, the fact that the payment is made only through the bank requires the bank to be paid the issuance fee. After the bank issuance fees are deducted, the remaining amount is transferred to the bank account of the importer company and the payment is completed.

Acceptance Credit Payment: In payment methods with acceptance credit, there are various commitments to the payments of the products sold by the exporter company. Payments are made in a certain time after the goods transfer takes place. In this payment method, payments are made within the framework of policies and agreements made between importer and exporter companies. In general, there are 3 different systems in the acceptance credit payment method.

Letter of Credit with Acceptance Credit: In this payment method, the shipping documents included in the letters of credit prepared in accordance with the international rules and the policies prepared next to these documents are used as a payment method. The documents accepted by the bank used by the importing company or by a correspondent bank should be released after that and the document and policy fees should be paid on the dates specified in the documents.

Against Documents with Acceptance Credit: It is realized within the framework of the dispatch documents prepared by the Bank and the policies prepared in addition to these documents. All documents and policies prepared must first be accepted by the importer company. After the policy documents are delivered to the importer company, all the goods received on the policy maturity date must be paid to the exporting company.

Against Goods with Acceptance Credit: It is the payment method that takes place if the price of the goods sold by the importer company is not received by the company. At this point, the payment is made after the policy acceptance between the importer and the exporter company and the maturity of the policy.

Payment by Letter of Credit: The payment method with letter of credit is usually created upon the request of the importer company. If payment is requested directly through the bank instead of different payment methods, the letter of credit payment method is preferred. In this payment method, the order of the importer company or the terms of the letter of credit of the bank that carries out the transactions directly on behalf of the bank are valid. The terms of the letter of credit are generally presented as follows:

The importer company must accept that it will make a payment to the exporting company or to the order of this company. In addition, in various regulations, it is obligatory to accept the policies created by the exporting company from the importer companies and to accept the payment on these policies.
The exporting company must authorize an intermediary bank to accept all the policies drawn for the payment methods to the importer company or for the payments to be made on the policy. At this point, documents are arranged between the banks authorized by the importer and exporter company separately.
Except for the above items, the importer company may authorize another bank to make a negotiation transaction. In such cases, the agreements made and the policies drawn between the two companies are evaluated within this scope and traded.

If we are to explain the letter of credit payment method in general, it includes that the bank authorized by the importer company, together with the instruction given by the importing company, completes the agreements with the exporting company that will fulfill the conditions required by the company until a certain amount or maturity. All documents regarding the transfer and delivery details of all goods to be exported by the exporter company are delivered to the importer company by the authorized bank. Together with these delivered documents or policies drawn, the importer company undertakes to pay the exporter company.

Letters of credit created together with all the agreements made are prepared within the framework of the Uniform Conventions and Practices for Documentary Credits brochure created by the International Chamber of Commerce. All agreements and policies drawn between importer and exporter companies must also be created within the framework of the rules in this brochure. Although the basic rules are determined, the total payment amount and policy maturity determined for the policies created are directly related to the total amount and quality of the products sold.