There are many various terms used in the fashion business. If you’re a newcomer to the biz, you should do well to master these, whether you’re selling wholesale t shirts or expensive furs.
L/C means a letter of credit. If you’re dealing with export or import of wholesale t shirts and other garments, you will see a lot of letters of credit. This document is typically issued by a bank which confirms that the buyer is able to pay the price of goods.
ul Letters of credits that concern return import are called Back-to-Back L/C. Imagine that you’re buying fabric from France, making wholesale t shirts in Germany, and selling them to France again. If you wanted confirmation for your credit rating, you could obtain a back-to-back letter of credit. Usually, it’s more convenient for you because you’re dealing with a single bank – but you can’t use it if you also sell some fabric.
You might know what invoice is, even from your daily life and using it for tax purposes. This is a document of sales, which includes products descriptions, prices, the number of cartons, the number of products in every cartoon etc. If you’re exporting wholesale t shirts and other garments you must have an invoice.
In the fashion business and in any terms there are many trading rules called Incoterms. If you’re trading in wholesale t shirts and exporting them to other countries, you should know at least some of them. EXW means Ex works – the buyer is responsible for the cargo the moment it leaves the factory. The opposite is DDU and DDP, where the seller presents the cargo at the buyer’s HQ. The responsibility of the buyer, transporter and seller for the cargo is determined by these terms.
If you are interested in the international trade, you should study it, as well as the fashion-related vocabulary!