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To successfully negotiate a business deal you have to be prepared, observant, professional, and much more. In this article I provide a number of tips for successfully closing a deal. 1. Listen and understand the other party’s issues and point of view. Some of the worst negotiators I have seen are the ones who do all the talking, seeming to want to control the conversation and expound endlessly on the merits of their position. The best negotiators tend to be the ones who truly listen to the other side, understand their key issues and hot buttons, and then formulate an appropriate response. Try to gain an understanding about what is important to the other side, what limitations they may have, and where they may have flexibility. Refrain from talking too much. 2. Be prepared. Being prepared entails a whole host of things you may need to do, such as: Review and understand thoroughly the business of the other party by reviewing their website, their press releases, articles written about their company, and so forth. A thorough Google and LinkedIn search is advisable here. Review the background of the person you are negotiating with by reviewing any bio on the company’s site, the person’s LinkedIn profile, and by doing a Web search Review what similar deals have been completed by the other side, and the terms thereof. For public companies, some of their prior agreements may be filed with the SEC. Understand the offerings and pricings from competitors of the party you are negotiating with. 3. Keep the negotiations professional and courteous. This is also known as the “don’t be an asshole rule.” Nobody really wants to do business with a difficult or abusive personality. After all, even after the negotiations are concluded, you may want to do business with this person again, or the transaction may require ongoing involvement with the representative of the other side. Establishing a good long-term relationship should be one of the goals in the negotiation. A collaborative, positive tone in negotiations is more likely to result in progress to a closing. 4. Understand the deal dynamics. Understanding the deal dynamics is crucial in any negotiation. So be prepared to determine the following: Who has the leverage in the negotiation? Who wants the deal more? What timing constraints is the other side under? What alternatives does the other side have? Is the other side going to be getting a significant payment from you? If so, the leverage will tend to be on your side. 5. Always draft the first version of the agreement. An absolutely fundamental principle of almost any negotiation is that you (or your lawyers) should prepare the first draft of the proposed contract. This lets you frame how the deal should be structured, implement key points that you want that haven’t been discussed, and gets momentum on your side. The other party will be reluctant to make extensive changes to your document (unless it is absurdly one sided), and therefore you will have already won part of the battle by starting off with your preferred terms. Having said that, you want to avoid starting the negotiations with an agreement that the other side will never agree to. Balance is key here. 6. Be prepared to “play poker” and be ready to walk away. You must be able to play poker with the other side, and be able to walk away if the terms of the deal aren’t up to your liking. This is easier said than done, but is sometimes critical to get to an end game. Know before you start what your target price or walkaway price is. Be prepared with market data to back up why your price is reasonable, and if you are confronted with an ultimatum that you absolutely can’t live with, be prepared to walk away. 7. Avoid the bad strategy of “negotiating by continually conceding.” Ten years ago, a company I was involved with was desperate to sell itself. The CEO was convinced that a certain prospective buyer was the ideal acquirer and he wanted to do the deal with them. But the buyer kept coming up with new unreasonable demands, and the CEO kept giving into those demands in the hopes of getting to a closing. So what did the buyer do? It learned that it could just keep asking for more unreasonable things, and that the CEO would always eventually cave. Nine months and $1 million in legal fees later, the company still didn’t have a deal. I then took over the negotiations and told the buyer that we were no longer interested in the terms they had been proposing, and we were walking away unless the price and deal terms got much better for us. By that time, the buyer itself had expended a great deal of legal fees and management time to get to a deal, and they panicked at the prospect of losing the deal. So they conceded to virtually every point I wanted, including an increased purchase price, and we closed the deal in 45 days. So the lesson was that continually conceding points (while not getting anything in return) can lead to the exact opposite of what you are hoping for. If you are conceding a point, make sure to try and get something in return. 8. Keep in mind that time is the enemy of many deals. You have to understand that the longer a deal takes to get completed, the more likely that something will occur to derail it. So be prompt at responding, get your lawyer to turn documents around quickly, and keep the deal momentum moving. However, that doesn’t mean you should rush through negotiations and make concessions that you don’t need to make. Understand when time is on your side and when time could be your real enemy. 9. Don’t fixate on the deal in front of you and ignore alternatives. In many situations you want to have competitive alternatives. This can enhance your negotiating position and allow you to make the best decision as to how to proceed. For example, if you are engaging in a process to sell your company, the best thing you can do is to have several potential bidders at the table. You want to avoid being locked up into exclusive negotiations with one bidder until you have reached a meeting of the minds as to the best price and terms available. Similarly, if you are looking to buy a product, lease office space, or acquire a loan for your business, you will often be better off if you have alternatives—and the other party knows it has viable competitors. By negotiating simultaneously with two or more parties, you can often obtain better pricing or better contractual terms. 10. Don’t get hung up on one issue. You want to avoid getting stuck on a seemingly intractable issue. Sometimes it’s best to suggest that an issue be set aside for the moment and both parties move on to make progress on other issues. A creative solution may come to you later outside the heat of the negotiation. 11. Identify who the real decision-maker is. You want to understand what kind of authority the other person that you are negotiating with has. Is he or she the ultimate decision-maker? I recently went through a long and fruitless set of negotiations with a person who kept telling me that he didn’t have the authority to agree to a number of points we were negotiating. He could tell me “no” to my requests but didn’t have the ability to tell me “yes.” My solution (because I had leverage) was that I ended the conversation and said that for us to make any progress, I needed to negotiate with the person who was authorized to make decisions and concessions. 12. Never accept the first offer. It’s often a mistake to accept the first offer from the other side. For example, if you are selling your home and you receive an offer, consider countering at a higher price or better terms (even if there are no other offers). If you don’t counter, the other party will be concerned that they offered too much and may end up with buyer’s remorse and attempt to get out of the deal. And buyers expect that there will be a counter as they expect that their first offer will likely be rejected. Most buyers will leave room in their first offer to go up by at least 5%-15% in price, depending on the situation. Counter-offers and some back-and-forth negotiation will most likely lead to the two parties being satisfied that they struck the best deal they could, and thus be more committed to closing the deal. 13. Ask the right questions. Don’t be afraid to ask the other party many questions. The answers can be informative for the negotiations. Depending on the type of deal, you could ask: Is this the best pricing or offer you can give me? What assurances do I get that your product or solution will actually work for me? Who are your competitors? How do their products compare? What else can you throw in to the deal without cost to us? (A particularly useful question to ask car dealers.) What is your desired timing for the deal? How does our deal benefit you? We want to avoid unreasonable forms of contracts or unreasonable lawyers on your end. How do we ensure that? 14. Prepare a Letter of Intent or Term Sheet to reflect your deal. It is often helpful, at the appropriate time, to prepare a Letter of Intent or Term Sheet to reflect your view of the key terms of a deal. This can help expedite getting to an agreement, save on legal costs, and continue the momentum for a deal. It is more informal than a definitive agreement and easier to reach agreement on. For example, Letters of Intent are often prepared and agreed to in connection with mergers and acquisitions (see Negotiating an Acquisition Letter of Intent). And here are some good sample forms to review that can help you draft such a document: A letter of intent for a joint venture A term sheet for leasing office space A venture capital term sheet A term sheet for investment by a strategic investor A term sheet for selling the company, favorable to the seller An acquisition letter of intent, favorable to the buyer 15. Get the help of the best advisors and lawyers. If it’s a big or complicated deal, you want real expertise on your side helping you in the negotiations and drafting the contract. For example, if you are selling your company, it is usually worth the money to hire an investment banker who knows your industry and has relationships with prospective buyers. If you are doing a real estate deal, you want an experienced real estate attorney who has done many deals like the one you are working on (and not a general practitioner lawyer). If you are doing an M&A transaction, you want a lawyer that has done 50 or 100 M&A deals (and not a general business lawyer). These advisors don’t come cheap, but are worth it if you get the right one. Richard D. Harroch.

Incoterms ® 2020 Explained, how they will affect global trade. The International Chamber of Commerce have published new Incoterms® 2020 that have come into effect from the 1st of January 2020.  The ICC originally published Incoterms® in 1936 and have continually made updates to reflect the changes to the Global Trade environment.  It’s important that all parties involved in trade clearly understand the changes and how they apply to global supply chains. Incoterms® play such a vital role in the world of global trade.  Incoterms® 2010 or Incoterms® 2020 may seem complicated, but it’s imperative that buyers and sellers clearly understand how they work and their own obligations along the supply chain.  In this article we explain the updates made and provide simple explanations, along with an Incoterms® infographic to explain Incoterms® 2020. What are Incoterms ® ? Put simply, Incoterms ® are the selling terms that the buyer and seller of goods both agree to during international transactions.  These rules are accepted by governments and legal authorities around the world. Understanding Incoterms ® is a vital part of International Trade because they clearly state which tasks, costs and risks are associated with the buyer and the seller. The Incoterm ® states when the seller’s costs and risks are transferred onto the buyer.  It’s also important to understand that not all rules apply in all cases.  Some encompass any mode or modes of transport.  Transport by all modes of transport (road, rail, air and sea) covers FCA, CPT, CIP, DAP, DPU (replaces DAT) and DDP.  Sea/Inland waterway transport (Sea) covers FAS, FOB, CFR and CIF, which we explain below. Why are Incoterms ® vital in International Trade? Incoterms ® are referred to as In ternational Co mmercial Terms .  They are a set of rules published by the International Chamber of Commerce (ICC), which relate to International Commercial Law.  According to the ICC, Incoterms ® rules provide internationally accepted definitions and rules of interpretation for most common commercial terms used in contracts for the sale of goods’. All International purchases will be processed on an agreed Incoterm to define which party legally incurs costs and risks.  Incoterms ® will be clearly stated on relevant shipping documents. An overview of Incoterms ® 2020 for 11 Terms, 7 for any mode of transport. EXW– Ex-Works  or Ex-Warehouse Ex works is when the seller places the goods at the disposal of the buyer at the seller’s premises or at another named place (i.e., works, factory, warehouse, etc.). The seller does not need to load the goods on any collecting vehicle. Nor does it need to clear them for export, where such clearance is applicable. FCA – Free Carrier The seller delivers the goods to the carrier or another person nominated by the buyer at the seller’s premises or another named place. The parties are well advised to specify as explicitly as possible the point within the named place of delivery, as the risk passes to the buyer at that point. FAS – Free Alongside Ship The seller delivers when the goods are placed alongside the vessel (e.g., on a quay or a barge) nominated by the buyer at the named port of shipment. The risk of loss of or damage to the goods passes when the products are alongside the ship.  The buyer bears all costs from that moment onwards. FOB– Free On Board The seller delivers the goods on board the vessel nominated by the buyer at the named port of shipment or procures the goods already so delivered. The risk of loss of or damage to the goods passes when the products are on board the vessel.  The buyer bears all costs from that moment onwards. CFR– Cost and Freight The seller delivers the goods on board the vessel or procures the goods already so delivered. The risk of loss of or damage to the goods passes when the products are on board the vessel. The seller must contract for and pay the costs and freight necessary to bring the goods to the named port of destination. CIF – Cost, Insurance and Freight The seller delivers the goods on board the vessel or procures the goods already so delivered. The risk of loss of or damage to the goods passes when the products are on the ship. The seller must contract for and pay the costs and freight necessary to bring the goods to the named port of destination. The seller also contracts for insurance cover against the buyer’s risk of loss of or damage to the goods during the carriage. The buyer should note that under CIF the seller is required to obtain insurance only on minimum cover. Should the buyer wish to have more insurance protection, it will need either to agree as much expressly with the seller or to make its own extra insurance arrangements. CPT  – Carriage Paid To The seller delivers the goods to the carrier or another person nominated by the seller at an agreed place (if any such site is agreed between parties). The seller must contract for and pay the costs of carriage necessary to bring the goods to the named place of destination. CIP – Carriage And Insurance Paid To The seller has the same responsibilities as CPT, but they also contract for insurance cover against the buyer’s risk of loss of or damage to the goods during the carriage. The buyer should note that under CIP the seller is required to obtain insurance only on minimum cover. Should the buyer wish to have more insurance protection, it will need either to agree as much expressly with the seller or to make its own extra insurance arrangements. DAP – Delivered At Place The seller delivers when the goods are placed at the disposal of the buyer on the arriving means of transport ready for unloading at the named place of destination. The seller bears all risks involved in bringing the goods to the named place. DPU – Delivered At Place Unloaded (replaces Incoterm ® 2010 DAT) DPU replaces the former Incoterm ® DAT (Delivered At Terminal).  The seller delivers when the goods, once unloaded are placed at the disposal of the buyer at a named place of destination. The seller bears all risks involved in bringing the goods to, and unloading them at the named place of destination. DDP – Delivered Duty Paid The seller delivers the goods when the goods are placed at the disposal of the buyer, cleared for import on the arriving means of transport ready for unloading at the named place of destination. The seller bears all the costs and risks involved in bringing the goods to the place of destination.  They must clear the products not only for export but also for import, to pay any duty for both export and import and to carry out all customs formalities.

Inspection is the practice of examining the physical condition of materials, components, or entire pieces of equipment in order to determine if and for how long it will operate as intended. Inspection plays a vital role in any asset integrity management program . Inspection provides information about the current condition of the equipment in question and may provide information to validate the reliability prediction for the equipment (i.e. validate the accuracy of the equipment remaining life estimation). Types of Inspection Nondestructive Testing Nondestructive testing (NDT) uses a variety of inspection techniques in order to locate and monitor defects without causing damage to the component. External and internal corrosion and cracks are often found using NDT methods. Some examples of common NDT methods include: radiographic testing , ultrasonic testing , magnetic particle testing , electromagnetic testing, and many more. When selecting an NDT method to use for a piece of equipment, the following four considerations should be accounted for: The type of damage mechanism to be inspected for The size, shape, and orientation of the defect Where the defect is located (external or internal) The sensitivities and limitations of the NDT method Destructive Testing (Mechanical Testing) In contrast to NDT, destructive testing causes damage to the test specimen. The purpose of destructive testing, also known as mechanical testing, is to reveal material properties when external forces are applied dynamically or statically. Important material properties of interest include: tensile strength, elasticity, elongation, hardness, fracture toughness, fatigue, and resistance to impact. Common mechanical tests that provide information about those properties include tensile testing, compression testing, torque testing, bend testing, hardness testing, charpy impact testing, and shear testing. Inspection for Reliability and Remaining Life The purpose of performing inspection is to provide information on the current state of a piece of equipment or provide information for remaining life calculations. Risk-based inspection (RBI) and fitness-for-service (FFS) assessments are two standards used in the oil and gas and chemical processing industries. Risk-Based Inspection RBI is a process that uses a combined system of methods to identify and understand risk. Put simply, risk can be defined by two elements: the consequence of failure (CoF) and the probability of failure (PoF). The CoF considers and evaluates the consequences of various outcomes (e.g. health and safety, environmental damage, equipment damage, and economic loss). The PoF is the likelihood that a piece of equipment will fail at a given time. Furthermore, both the CoF and the PoF involve qualitative and quantitative assessments. The fundamental concept of RBI is “How much confidence do I need to have in what I believe to be the true damage state of the equipment [1]?” RBI can be used to reduce uncertainty about the damage state of a piece of equipment by prioritizing inspection-related techniques. This is usually done by means of NDT. Learn more about RBI. Fitness-for-Service FFS is a recommended practice and industry standard that evaluates in-service equipment for structural integrity. The purpose of FFS is to determine if a component is suitable for continued service. There are three levels of FFS assessments, each increasing in level of detail, analysis, and complexity. Typically, data from NDT and mechanical testing provide critical inspection information used for FFS assessments. The outcome of an FFS assessment, as it relates to inspection, is to establish inspection intervals for specific equipment in order to monitor and eliminate potential failures. Establishing inspection intervals improves the overall safety, reliability, and efficiency of aging equipment. Learn more about FFS. Inspection for Quality Assurance and Quality Control Quality assurance (QA) and quality control (QC) are often confused as being the same process. However, the two processes are distinct. Quality Assurance The purpose of QA is to inspect the process that manufactures products. In other words, QA is a process that looks to improve the product development in order to eliminate defects in manufactured products. Inspection relating to QA does not typically involve NDT nor mechanical testing but rather, uses qualitative methods to identify gaps and anomalies in the process. Quality Control QC is carried out after QA and involves inspection of the product . The QC process involves activities such as NDT to ensure the quality of the product will operate as intended and for a specified number of cycles (if applicable) before failure. Mechanical testing may also be performed on one part per batch or per “X” number of batches. The number of batches is up to the company and individuals involved in the manufacturing process. The purpose of QC is to detect flaws and to determine if the defect is acceptable or rejectable for service. Codes and Standards Relating to NDT and Mechanical Testing Since there are hundreds of standards relating to NDT and mechanical testing, it is best to list the organizations that develop and publish standards pertaining to inspection. The following standards bodies are well known in the inspection community: The American Society for Nondestructive Testing (ASNT) ASTM International American Society of Mechanical Engineers (ASME) American Petroleum Institute (API) American Welding Society (AWS) National Board of Boiler and Pressure Vessel Inspectors (NBBI) International Organization for Standardization (ISO) American National Standards Institute (ANSI) European Committee for Standardization (CEN) European Pressure Equipment Directive (PED) Relating to RBI and FFS API RP 580 - Risk-Based Inspection, Third Edition API RP 581 - Risk-Based Inspection Technology, Third Edition ASME PCC-3 - Inspection Planning Using Risk-Based Methods API RP 579/ASME FFS-1 - Fitness for Service, Second Edition

What is PayPal and how does it work? PayPal has been in the mobile payments business for well over a decade. It's is an online financial service that allows you to pay for items using a secure internet account. You simply add your bank account, credit card or debit card details and whenever you pay using PayPal, you can choose which of your cards or accounts it pays with. You can also set one to be the default payment method and that will be used unless you choose otherwise. In addition to paying for items using PayPal, you can also receive money through the service. Any money received sits in your PayPal account and can be used when paying for something, with the balance topped up by your assigned cards or bank account. Alternatively, you can transfer the money to one of your assigned bank accounts or cards.There can be a fee applied when you receive money to your PayPal account. For example, if you sell an item on eBay. However, the vast majority of uses are completely free to you on a personal basis. It is free to transfer money to friends or family through PayPal accounts, as long as there is no currency conversion required. There are business PayPal accounts available too, which you can find out more about here. PayPal enables many businesses to accept card payments which they were unable to previously. PayPal is often associated with eBay as it used to be owned by the online auction house. However, it was spun off as a separate company in 2015. Why use PayPal? While there are plenty of online payment systems these days, such as Apple Pay and Google Pay, PayPal offers a few additional benefits that others might not. To begin with, its age means it is well established and widely accepted, even from smaller etailers. You will find a pay by PayPal option on thousands of websites that do not offer the same for Apple Pay or other digital financial services. Its buyer protection safeguards will also ensure you get a refund if an item you buy online doesn't arrive or doesn't match a seller's description. This is especially useful when purchasing items on eBay, where you do not usually have shop guarantees. Those selling items on a personal or business level and are paid through PayPal are also protected. For example, if you can provide proof that you sent an item by post yet the buyer claims not to have received it, you get to keep the full payment. Another reason to use PayPal is that it offers an additional layer of security to payments. As you do not have to enter your card details or CCV number each time you purchase something, just your PayPal login and password or mobile number and PIN, the online store does not have your details in its database. Sometimes you can also use OneTouch payments, where PayPal keeps you logged in if you activate the service and you do not have to enter your details each time you purchase something, no matter which store. That's because it is specific to a device and browser. For example, if you enable OneTouch on your PC, it will only work when you use that specific computer and the same browser. There are dedicated PayPal apps for iPhone and Android devices. How do I get a PayPal account? It's easy to sign up for a PayPal account. You head to PayPal.com and click the Sign up button. It'll ask if you want to sign up for a personal or business account and away you go. Don't forget to have your bank, credit or debit card details to hand though. How to pay with PayPal? PayPal works online and in stores through a browser or mobile application. There are dedicated apps for Android and iOS. When paying online, you just need to look for the PayPal symbol and check out by following the simple instructions on screen. The apps do more though. Thanks to many partnerships with stores and restaurants in your area, you get different options of how to pay for products, food or petrol, even order ahead to beat the queues in some food establishments and coffee shops. The app shows you a list of all the vendors nearby that accept each of the different PayPal options. You can also add loyalty cards to your PayPal account, in order to gain loyalty points whenever you pay for something using the app. What is PayPal Credit? Last year PayPal started its own credit service, where you can pay for items using PayPal but pay from them later. It's a lot like a credit card although you don't require an actual card. It currently charges a (variable) purchase interest rate of 17.9 per cent per annum but as an incentive, you get 0 per cent interest on purchases of over 99 Euros for four months. So if you pay it back within that time, it won't cost you more than the original purchase price. Some stores offer special deals when paying for products using PayPal Credit, with reduced interest rates depending on the retailer.

Among industry classification systems , Harmonized System (HS) Codes are commonly used throughout the export process for goods. The Harmonized System is a standardized numerical method of classifying traded products. It is used by customs authorities around the world to identify products when assessing duties and taxes and for gathering statistics. The HS is administrated by the World Customs Organization (WCO) and is updated every five years. It serves as the foundation for the import and export classification systems used in the United States and by many trading partners. The HS assigns specific six-digit codes for varying classifications and commodities. Countries are allowed to add longer codes to the first six digits for further classification. The United States uses a 10-digit code to classify products for export, known as a Schedule B number, with the first six digits being the HS number. There is a Schedule B number for every physical product, from paperclips to airplanes.  The Schedule B is administered by the U.S. Census Bureau’s Foreign Trade Division. How You Use the HS Code You will need both the U.S. Schedule B number and the foreign country’s version of the HS code for your product during the export process. You use it to: Classify physical goods for shipment to a foreign country; Report shipments in the Automated Export System (AES) when the value is more than $2,500, or the item requires a license. Complete required shipping documentation such as shipper’s letter of instructions, commercial invoice or certificate of origin; Determine import tariff (duty) rates and figure out if a product qualifies for a preferential tariff under a free trade agreement; Conduct market research and obtain trade statistics; Comply with U.S. law, where applicable. How to Identify Your Product’s (U.S.) Schedule B Code The Census Bureau offers a free, widely used online Schedule B search tool that can help you classify your products. The Schedule B search tool is the most commonly used method for classifying products. The site provides training resources to help you better identify for your Schedule B number, as well as contact information for assistance. If your product is difficult to classify, the Customs Rulings Online Search System (CROSS) database can help you find its Schedule B code. CROSS contains official, legally binding rulings from other exporters’ and importers’ requests for Schedule B codes. Use this database to determine whether other exporters or importers requested a ruling on the same or a similar product and, if so, what that ruling was. Special situations: Shipping multiple items as a set : For the most part, determining a product’s Schedule B code is straightforward. For example, an unassembled bicycle that is sold in a box containing the bicycle frame, handlebars, pedals, and seat is classified as a bicycle (because the item is sold as one unit) and not as several different components. Some sets, however, are harder to classify. Rule 3 of the General Rules of Interpretation (GRI) of the Harmonized Tariff Schedule addresses composite goods, mixtures, and items that are sold in a set. The GRI has established a three-step process for determining the Schedule B code in such situations; the introduction to the official Schedule B publication contains the relevant passage. Textiles/Apparel shipped as a set: The rules that govern Schedule B codes for textiles and apparel sets are unique. Refer to GRI Chapter 50, Note 14 for more information. How to Identify Your Product’s Foreign HS Code To determine what the HS Code for your product is in another country, you can use a look-up tool in a foreign tariff database, such as the Customs Info Database.