The mistakes in international transactions that make Japanese companies prone to fall is "Starting transactions without signing a contract."
This is related to culture and business practices, it is believed that human nature is fundamentally good, since we basically trust the other party, we tend to do business even with oral promises. Of course, as long as the business is going well, there will be no problem with oral promise. The problem is when issues such as delayed payment surfaces.
The contract can be made by “Offer and Acceptance” and does not have to be in writing.
However, when a problem arises, in case of only oral promise or e-mail, at the time of problems such as delayed payment there is no rule like a penalty as compared with a contract.
Obviously, you can prove the existence of a contract if you invoice the order by e-mail and there is a receipt of the product but there is no match for a contract in which the parties have discussed, agreed upon, and signed on how to deal with various issues arising from the transaction beforehand.
The other party may also delay payment in anticipation of this point. For the debtor, creditor priorities always exist and generally foreign creditors are often postponed. Furthermore, without a contract, priorities can go down, but not go up.
Some companies have claimed that "There is no problem even without a contract so far," but that is only a thing of the past and does not guarantee the security of future transactions.
When dealing with foreign companies, I would recommend exchanging basic contracts.
