Ninety-day LC terms on an 8% margin: take the order?
Ade O.
Verified member · Procurement lead
Order of USD 460,000, 90-day letter of credit, 8% gross margin.
Bank financing costs about 4%, and documents and insurance take more, so net is under 3%.
The client is long-standing and steady. Should we take it?
Discussion (3)
Fatou D.Verified member · Procurement lead2026-10-29
Price the capital cost in; 8% gross over 90 days actually loses money.
Yusuf B.Verified member · Dealer2026-10-30
Negotiate staged documents and staged payment to shorten average exposure.
Grace W.Verified member · Project chief engineer2026-10-31
Even long-standing clients carry document risk; one soft clause can eat the whole margin.
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