Welcome to Trade Terms Tuesday! Each Tuesday, we will share three trade-related terms. In order to reach out to our diverse readership, we will try to provide one for exports, one for imports, and one for logistics/transportation. This week, we continue with the O’s.
Open Top Container
An open top container is similar to a regular freight container; however, it does not have a rigid roof. The open top container may have a flexible or removable cover constructed of plastic or canvas material.
Open Account
In an open account transaction, credit is granted to the buyer without any security. Goods are shipped to the buyer without any guarantee of payment. This form of payment is the most risky to the seller, so it is important that the buyer has an excellent payment history and/or references from other parties with whom the buyer has done business.
In an open account transaction, credit is granted to the buyer without any security. Goods are shipped to the buyer without any guarantee of payment. This form of payment is the most risky to the seller, so it is important that the buyer has an excellent payment history and/or references from other parties with whom the buyer has done business.
Offsets
An offset is a compensation practice that foreign governments or companies require U.S. businesses to enter into as a condition of purchase. These arrangements tend to be reciprocal. For example, as part of a purchase agreement of $10 million worth of aircraft parts, the seller agrees to purchase $10 million of electronic equipment from the buyer's country.
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