In the international trade exist different forms of risk that are given in different factors of the commerce. These factors are divide in six so arefollowing:
The product risk are risks that the seller has to accept as part of commitment. First it is a matter of the product itself, or the agreed delivery. In the product risks are includedthe main risks such as: manufacturing risks, transport risks and cargo insurance.
The commercial risks, also called as purchaser risk, is defined as the risk of the buyer going intobankruptcy or being in any other way inacceptable of fulfilling the contractual obligations. It is relatively easy to obtain a fair picture of potencial buyer, to study their published accounts or toask for an independent business credit report. The credit information may be an important factor in the potencial growth of business, the risk involved in carrying out international business can alsohe high.
Adverse business risks
Adverse business risks included all business practices of a negative nature. Which are not only common but also almost endemic in some parts of the world, this couldhave serious consequences, for the individual transaction, but also for the general business an financial standing of the seller.
The political risk is the risk of separatecommercial transcaction not being realized in a contractual way due to measures emanating from the government or authority of the buyer’s own or any other foreign country, political risk coulbe divided intodifferent causes such as: political stability, social stability and economic stability
In the currency risks the seller incurs their costs, a new currency risk will arise, the seller’smain costs will be in local currency, which automatically creates such a risk if invoicing in another currency
Purchasing, production and shipment all place a financial burden on...