This is also often called “Trade Financing for Importers”. If you rely on imported goods to sell to your US or Canada-based customers, Amerisource can help you enhance your relationship and terms with your international suppliers.
Your foreign supplier may ask for pre-payment before goods are shipped (commonly referred to as cash-in-advance, or “CIA”). Your supplier might also ask for payment through a secure instrument such as a Letter of Credit (“L/C”). Amerisource can issue these L/Cs to your suppliers as an add-on product for existing borrowers within specified credit parameters. Amerisource L/Cs are accepted by vendors worldwide.
In essence, this allows an Amerisource client to obtain “inventory financing” from its suppliers. Specific L/C and trade finance structures include:
- Irrevocable Letters of Credit – Amerisource issues an L/C guaranteeing payment to a vendor for a specific shipment once vendor has met all of its obligations to you under the contract or purchase order. While most bank-issued L/Cs require the L/Cs to be cash-secured, Amerisource allows for the accrual of security over time. This allows you to avoid paying your vendor CIA terms, maximizing your working capital and minimizing your transaction risk. Amerisource L/Cs are accepted worldwide.
- Standby Letters Of Credit – Amerisource issues an L/C which remains “open” (on standby) for a pre-specified period of time. This is designed to help you obtain open payment terms with your overseas supplier. Standby L/Cs are typically bound to a sub-limit under your existing credit line with Amerisource.
- Standby Vendor Guaranty – Amerisource issues a guaranty for payment to your supplier, designed to enhance your existing credit relationship. Standby Vendor Guarantees are typically bound to a sub-limit under your existing credit line with Amerisource.
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