ennakkohyötys

Ennakkohyötys is a Finnish term that translates to "advance payment" or "pre-payment" in English. It refers to a sum of money paid by a customer to a seller before the delivery of goods or services. This practice is common in various commercial transactions and serves several purposes for both parties.

For the seller, an advance payment can help secure the transaction, ensuring the buyer's commitment. It can also provide necessary capital for production, procurement of materials, or other expenses associated with fulfilling the order. In some cases, especially for custom-made items or large projects, an advance payment is crucial to mitigate the seller's financial risk.

For the buyer, making an advance payment can sometimes secure a better price, reserve a product that might otherwise sell out, or guarantee the commencement of a service. It can also be a sign of good faith towards the seller. However, it also entails a risk for the buyer, as they are transferring funds before receiving the agreed-upon goods or services. Therefore, it is important for buyers to ensure they are dealing with a reputable seller and to have clear agreements regarding the terms of the transaction, including what happens in case of non-delivery or dissatisfaction.

The amount of the advance payment can vary greatly depending on the industry, the value of the transaction, and the agreement between the parties. It can range from a small percentage to a significant portion or even the full price of the goods or services. Contracts and sales agreements typically specify the terms and conditions related to any advance payments.