“30/70 against documents” is the working payment norm of the international drilling-chemicals trade: 30% of the invoice with the order, 70% when the supplier presents the shipping documents. It is popular because it splits the risk of a long-distance transaction roughly where it belongs. This page explains the mechanics plainly — what each stage protects, what the documents prove, and when a different instrument is the better choice.
| Stage | Who has moved what | What protects the buyer | What protects the seller |
|---|---|---|---|
| 1. Order + 30% deposit | Buyer: 30%. Seller: nothing yet | Deposit follows company verification — license, name match, spec and COA format in hand | Deposit covers raw material and confirms the buyer is real |
| 2. Production | No further money | Optional inspection: sampling, loading witness, sealed container | Goods are made against a committed order |
| 3. Shipment + documents | Seller: goods on the water. Buyer: 70% against documents | Balance moves only against bill of lading, packing list, batch COA — evidence of what shipped | Balance is received before the buyer controls the cargo |
| 4. Arrival | Exchange complete | Goods tested against the COA; the document file supports any claim | — |
The deposit is the only money at risk before the cargo exists, and it is the smaller share. The balance — the bulk of the cash — moves only against evidence. Neither side ever holds both the money and the goods.
The bill of lading is issued by the shipping line, not the seller — it proves a container was received on board a named vessel, and it is the document your clearing agent needs to take delivery. The packing listties the container’s contents to the order line by line. The certificate of analysisties the batches in the container to laboratory results against the specification — for drilling chemicals, stated against API Spec 13A test methods. A seller can fake its own promises; it is much harder to fake a carrier’s bill of lading, and harder still when an independent inspection report from loading sits in the same file. That is why the 70% is released against documents rather than against a phone call.
| Instrument | Best when | The catch |
|---|---|---|
| 100% prepayment (T/T bank wire) | Never advisable with a new supplier | All risk on the buyer; the strongest fraud pattern in the trade targets exactly this |
| 30/70 against documents | Container-scale trade with a verified supplier | Deposit still at risk — which is why verification precedes payment |
| Letter of credit | Very large contracts; buyers whose banks require it | Issuance cost and time; heavy cash-coverage requirements at many banks; document-compliance risk |
| Open account / credit terms | Long-standing relationships with trade history | No new supplier offers it honestly; treat unsolicited credit offers with suspicion |
The pattern: instruments trade cost for protection. 30/70 sits in the middle — meaningful protection at near-zero instrument cost — which is why it is the working norm for container-scale chemical trade, and why several markets we serve (see the Iraq payment guide) prefer it for banking-capacity reasons as well.
The split can move with trust and order size — 20/80 or 40/60 both appear; a repeat buyer with a clean history can reasonably push toward a smaller deposit. Payment against a copyof the bill of lading versus the original set is a real distinction: paying against the copy is faster; paying against originals (or a telex-release arrangement) is stricter. For first orders, stricter is better. What should never vary: the beneficiary account name matching the seller’s registered company name on every payment, first and last.
30% with order, 70% against shipping documents, USD, CFR your port, no letter of credit required. Inspection before shipment on request. The document file — invoice, packing list, bill of lading, batch COA — is prepared for your bank and your clearing agent as part of the trade, not as a favor.