Negotiating and hedging contracts in export/import transactions – TRADE FINANCE*

    International Trade Forfaiting Association

Negotiating and hedging contracts in export/import transactions – TRADE FINANCE*

TRAINING – PROFILE AND OBJECTIVES

The posts of a buyer, dealer, seller and export/import specialist negotiator, advisor of international client, sales manager and other similar ones – these are some of the most essential in the operational structure of the company. The work of those people directly influences the level of sales incomes and operational costs and due to this, also the profit margin and EBIT. As a result of taking wrong sales and cost decisions (e.g. investing the forces and resources into a growing turnover without taking care of a safe level of profitability – profit margin) in categories like sales profit or EBIT – a loss can appear. And it is almost inevitable that an operating loss will follow and finally also a loss in profit and loss account. This can lead to a breach of own capital and – very often – to a lack of dividends for stockholders/shareholders and no bonuses for employees.

Inadequate trade preparation (sales and purchases) can also result in occurrence of operating or financial losses if the execution of contracts will not be duly hedged (the risk of non-payment of the recipient, the risk of improper contract execution, the risk of an insufficient level of product quality, the risk of product loss due to external actions, including forces of nature and other ones).

Trade Finance field helps to efficiently negotiate, hedge and finance trade contracts. The offered training helps to develop key trade skills (negotiations) but also provides a unique knowledge in the scope of guarantees, letters of credit, vendor finance, supplier finance. The trade workshop is universal – most of sales techniques work in every sales channel and in any business.

During the training the following topics are presented:

  • trade contract – structure and key aspects
  • contract profitability calculation
  • legal matters – national and international law in contracts
  • Incoterms – suppliers conditional in the process of export sales / import purchases
  • bank and insurance contractual guarantees
  • letters of credit and direct debits documents
  • transferring payment risk onto third party – forfaiting and factoring
  • vendor finance programmes – sales support
  • supplier finance – purchase support
  • credit risk hedging with the participation of foreign banks (the bank of exporter and importer)
  • working capital financing in a contract: loan for the buyer/pre-financing the contract
  • optimisation of balance sheet, profit and loss account, cash-flow with utilisation of Trade Finance
  • commodity trade

KNOWLEDGE AND SKILLS THE PARTICIPANT WILL OBTAIN DURING THE TRAINING

  • how to negotiate trade contracts and what to pay attention to
  • how to hedge trade contracts in national and international transactions
  • how to finance trade contracts in the pre- and post-financing options
  • how to limit financial and operational risks by including banks and other financial institutions
  • negotiation strategies
  • the management of the chosen elements of financial statements through trade contracts
  • how to overcome the obstacles in the process of export sales and import transactions

TRAINING RECIPIENTS

  • sales specialists working in various sales channels: telephone, mail, social media video, meetings in person
  • dealers
  • sales managers
  • buyers
  • BDMs
  • account advisors
  • sales experts
  • account managers
  • KAM
  • team leaders

TRAINING – AGENDA

  • training is divided into thematic blocks and supplemented with workshop tasks in sub-groups, after each block:
    – trade contract elements, legal aspects
    – Incoterms
    – solutions and tools hedging trade contracts – operational and financial risk
    – trade contract financing and credit risk division
    – strategical thinking in relations with the international customer
    – business negotiations
    – optimisation of financial statements form the point of view of Trade Finance
  • training takes 2 days (7 hours/day)
  • dates, times, breaks, location – to be agreed

*** All rights reserved. No part of this publication may be reproduced, stored in a retrieval system or transmitted, in any form or by any means, electronic, mechanical, photocopying, recording or otherwise, without permission in writing from the publisher Academy of Skills Tomasz Wójtowicz

About me

Tomasz Wójtowicz, Phd – I am an experienced business practitioner as well as an academic teacher. My 22-year professional career, including 13 years of managerial practise in big international organisations (Citigroup, Commerzbank, DBK Group) and other companies (ATW_Poznan Ltd. – Chairman of the Board; University of Computer Sciences and Economics – Chairman of the Managing Board) gave me the essential insight and experience. During my career path in corporations, eight times I participated and conducted structural and organisational changes, not just as a researcher, scientist, advisor or consultant but always as an employee. It allowed me to get a better understanding and knowledge of implemented changes, from the point of view of an employee as well as the manager.

Business fields which are supervised are as follows:

  • the sale, post-sale support and management of the transactional banking products and trade finance for corporate clients (of annual revenues above 10 billion euros, including companies the ones listed on WSE and other European and American Stock Exchanges); on average the companies process approx. 15 000 operations annually,
  • the supervision of B2B sale teams – account assistant, product advisor, representatives, BDMs, KAMs – up to 30 people; cooperation with national and international sales net up to 300 people,
  • product management – product development department, search and implementation of innovations,
  • financial analysis and risk management within trade finance and investment,
  • implementation of a lean management concept in organisations,
  • forward budget (revenue, cost and income targets) of 120 million PLN (EBIT)
  • relation management with the key clients
  • optimisation of the financial sheets (the balance and cash-flow structure, return on sales, return on assets and capital in profit and loss account)

In 2011-2019 I was a Head of Trade Finance Department in mBank S.A. (Commerzbank Group). Beforehand – 2000-2011 – in my career path I was appointed a Head of Regional Sales Department and a Head of Global Transaction Sales Services Department for Institutional Customers in Citi Handlowy (Citigroup).  In 1997-2000 I worked in the Financial Department of DBK Group, preparing analyses and reports required for management decisions. Within the scope of my managerial duties I efficiently ran a team of 50 people and directly co-operated with the net of bank advisors and analysts in the whole country (more than 300 people). I managed a company of FMCG trade (ATW_Poznan Ltd.) and the finance and restructuring processes at a private university (University of Computer Sciences and Economics)

In 2004 I got a PhD in management and accountancy at the University of Warmia and Mazury in Olsztyn. It allowed me to combine the theory with the practise. For 20 years (1998-2018) I specialised in financial and managerial accountancy, financial analysis, company’s finance and audit (over 25 publications assistant professor in the Department of Economics).

In May 2019 I graduated from MIT, USA, after completing an international training for Executives: Leading change in complex organization, organised by Massachusetts Institute of Technology Sloan School of Management, Cambridge, USA.

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