Payment Terms for Glove Imports: T/T vs Letter of Credit Explained

How Payment Terms Work in Glove Imports

When you import gloves, payment is almost never made all at once. Instead, the supplier and buyer agree a payment structure that balances the factory's need to fund production against your need to protect your money. The most common structure is a deposit before production and a balance payment against the shipping documents, but the details matter and getting them wrong can cost you real money.

Your choice of payment term affects three things: how much cash you tie up, how much protection you have if something goes wrong, and how willing the supplier is to give you a good price. Understanding the options lets you negotiate terms that work for both sides rather than accepting whatever the supplier proposes first.

T/T (Telegraphic Transfer): The Standard Choice

T/T is a bank wire transfer, and the most common arrangement for glove imports is 30/70: you pay 30 percent as a deposit to start production, and the remaining 70 percent when the goods are ready, against the copy of the shipping documents. Some suppliers offer 30/70 or 50/50 depending on the relationship and order size.

• 30/70 T/T - 30% deposit, 70% balance against shipping documents. The industry standard.
• 50/50 T/T - 50% deposit, 50% balance. Common for custom or OEM orders.
• 100% advance - never recommended; you carry all the risk with no leverage.

T/T is fast, low-cost and simple, which is why it dominates the industry. The trade-off is that it offers less bank-level protection than a Letter of Credit, so it works best with suppliers you have verified - through samples, factory audits or a track record of previous orders.

Letter of Credit (L/C): Protection at a Cost

A Letter of Credit is a bank guarantee: your bank promises to pay the supplier once they present documents that meet the exact terms you specified. This protects you because the bank only pays against compliant documents, and it protects the supplier because they know the bank will pay. L/C is most useful for large first orders with a new supplier.

The downsides are cost and complexity. Banks charge fees for opening and handling an L/C, and the terms must be drafted precisely - a single mismatch in the documents can cause a delay or refusal. For smaller orders the cost often outweighs the benefit, which is why most glove importers reserve L/C for the largest, riskiest first transactions and switch to T/T once trust is established.

Choosing the Right Term for Your Order

The deposit is what funds production, so the supplier needs enough to cover materials and labour. The balance is your leverage - paying it only against the shipping documents ensures you are paying for goods that actually exist and are ready to ship.

Red Flags and How to Protect Yourself

1. Full payment in advance. Any supplier demanding 100 percent before production is asking you to carry all the risk. Walk away or renegotiate.
2. Payment to a personal account. Pay the supplier's company account, not an individual's personal account, unless you have verified the relationship.
3. No written proforma. The proforma invoice must state the payment terms, MOQ, price, packaging and lead time in writing before you pay anything.
4. Changing bank details. If the supplier changes their bank account mid-transaction, verify by phone before paying - this is a known fraud pattern.

Protecting yourself is mostly about process: a written proforma, payment to a verified company account, and a balance tied to shipping documents. These three habits eliminate most of the risk in glove imports.

How Expedition Safety Structures Payment

Expedition Safety uses standard T/T terms: a 30 percent deposit to begin production and a 70 percent balance against the shipping documents. We issue a detailed proforma invoice that locks the price, MOQ, packaging and lead time in writing before you pay, and we accept payment to our company account. For larger or first-time orders we are happy to discuss the structure that gives both sides the right protection, and our documentation is always ready to support a Letter of Credit if you prefer bank-level security.

Putting This Into Practice

The difference between a smooth import and a stressful one is rarely the product itself - it is the preparation. Before you contact any supplier, write down your target volume, your destination port, your required sizes, and the documentation your customers will expect. Having these four things clear in writing lets you compare quotes on an equal basis and stops you from being swayed by a lower number that hides a different specification.

Then run every supplier through the same questions: what is included in the price, what are the payment terms, what is the lead time, and what documentation do you provide. A supplier who answers these directly and in writing is one you can build a business on; a supplier who avoids the questions is one to walk away from.

A Realistic First-Order Timeline

Most first-time importers underestimate how long a first order takes. Here is the sequence you should plan around:

1. Week 1 - request and receive samples, test on real tasks.
2. Week 2 - confirm specification, sign the proforma, pay the deposit.
3. Weeks 3-5 - production, with in-line quality inspection.
4. Week 6 - final AQL inspection, loading and balance payment.
5. Weeks 7-10 - ocean freight, customs clearance and inland delivery.

Building this timeline into your planning - and ordering before you run low on stock - is what keeps your business supplied without interruption. Experienced importers hold safety stock precisely because the full cycle from order to delivery is longer than most new buyers expect.