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Agreement Letter

 

Do You Really Need a Sales Agreement?

In the fast-moving world of international trade, it may seem tempting to rely on verbal promises, email confirmations, or informal WhatsApp messages. But when disputes arise—or worse, when payments fail—having a clear, written Sales Agreement could be the difference between profit and loss.

What Is a Sales Agreement?

A Sales Agreement is a formal contract between a seller and a buyer that outlines the terms and conditions of a transaction. In export-import scenarios, it acts as a legal safeguard that ensures both parties understand their rights and responsibilities.

5 Reasons Why a Sales Agreement Matters

1. Clarity and Transparency

It defines what product is being sold, in what quantity, at what price, and under what terms (e.g. FOB, CIF, DDP). Everyone’s on the same page—literally.

2. Protection from Disputes

If the buyer claims the product was late or incorrect, you can refer to the agreement. It protects you from false claims or misunderstandings.

3. Payment Security

Clearly outlining payment terms (e.g. 30% down payment, 70% upon BL) helps avoid late or missing payments. It can also be used to enforce legal action, if necessary.

4. Defines Incoterms and Responsibilities

Who’s responsible for shipping, insurance, or customs clearance? A Sales Agreement clarifies these using official Incoterms like FOB, CIF, or DAP.

5. Builds Buyer Trust

Serious buyers respect suppliers who use professional documentation. It signals that you are a legitimate and experienced exporter.

What Should a Good Sales Agreement Include?

Here are the typical components:

  • Names and details of both parties

  • Product specifications (type, size, packaging, grade)

  • Quantity and unit price

  • Total value of contract

  • Delivery terms and timeline

  • Payment method and schedule

  • Dispute resolution clause

  • Incoterms (e.g., FOB Surabaya Port)

  • Signatures and company stamps

When Can You Skip a Sales Agreement?

  • For samples or low-value trial orders (under $500), email confirmation might be sufficient.

  • Repeat orders with long-standing partners, where trust has already been established.

However, even in those cases, having a pro forma invoice with terms written clearly is highly recommended.

What If the Buyer Refuses to Sign?

A buyer refusing to sign a Sales Agreement is a red flag. Serious importers won’t object to basic protection clauses. If they hesitate, ask:

“If you’re confident in our deal, why not formalise it to protect both sides?”

If they still resist, reconsider proceeding—especially if you’re exporting high-risk goods like charcoal, coffee, or perishables.

Conclusion: Smart Traders Use Sales Agreements

Whether you're exporting coconut shell briquettes, textiles, or machinery, a well-drafted Sales Agreement is one of your most important business tools. It offers clarity, legal protection, and peace of mind in an unpredictable global marketplace.

Don’t rely on hope. Rely on documentation.

#SalesAgreement #ExportSafety #InternationalTradeTips #CharcoalExport  #TradeContracts #CharcoalNewsroom #ExportIndonesia #B2BSecurity



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