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ABSTRACT
Although the customer risk abroad is similar to that existing for a customer in France, it is aggravated by the fact that the debtor is located in a different legal, social and cultural environment, which is difficult to master, even with local parties involved. The aim of this article is to identify various fundamental techniques available to the operator in international trade in order to prevent non-payment risks. Currency risk, at the heart of any foreign currency transaction, must be systematically addressed.
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Jacques DUBOIN: Associate Professor of Economics and Management - International Business Specialist - Co-editor and co-designer of "Exporter" and "S'internationaliser - This article is an updated version of the article entitled "International business – Customer and currency risk" by the same author, published in 2008.
INTRODUCTION
This article deals with the risk of non-payment, or reduced payment, due to the debtor's default, associated with any international sale or purchase transaction. It is essential to be extra cautious, and to adopt a risk prevention policy adapted to each region, or even each country, due to cultural, linguistic, legal or social differences!
Customer risk management takes place before any contract is signed, and throughout the life of the contract, from prospecting to order settlement. It must also be applied to the existing customer portfolio.
Customer risk management must be integrated into an overall risk management policy, and begins with prospecting.
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KEYWORDS
| risk management | bank | foreign exchange risk | factoring
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Industrial management
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International customer risk management
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Bibliography
Websites
• AFDCC – Association française des "crédit manager" et conseils associés http://www.afdcc.com
• AUMA – German Trade Fair Association http://www.auma.de
• CESCE – Hispanic credit insurance specializing in Latino markets http://www.cesce.com
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