Export Financing. An Overview.
In order for small business to sell their products or services abroad and step into the global field, they often need Export Financing.
Often, businesses look for Export Financing whenever their exporting costs are too high.
Companies need funding during their first stages. They need to have money available to investigate the markets they will be working one and this process is costly.
When doing marketing for their product abroad, Export Financing is needed by exporters that have to attend international trade fairs or trade missions to other countries to translate their brochures or product catalogs in order to advertise in foreign markets, or develop a website to contact potential buyers and travel.
Export Financing is useful whenever a company invests in manufacturing their product or in proving a service to a market abroad. The foreign customer has the expectation that he or she will receive the product or service on time; however the exporter is more concerned about working capital, equipment and property cost.
When you have made the export sale and it is waiting for payment on terms agreed upon, because certain exports can take from 90 and 180 days to conclude. Often small exporters do not have sufficient cash flow to cover all costs in the export process, until the customer pays abroad.
But where can exporters find financing? A possible source for Export Financing is one the bank with which it already has an established relationship. If the bank does not have a department of international trade, it can be difficult to get financing for exports. In this case it may be necessary to establish a relationship with a larger bank. But even here, it may be that the bank is not willing to take risks with this type of financing.
But not everything is lost. The U.S. Government is also a reliable source of Export Financing. Loan guarantees can be a good letters of presentation that help exporters find extra funding from big banks.
If you are interested in finding more about Export Financing from the US Government, do a little research into options offered by the Federal Agency for the Development of Small Business (SBA). Here we give you some examples on programs that can be useful for you: Working Capital Program for Export by SBA, the International Trade Loan Program, the Normal Program of Loan Guarantees for Business, SBA Export Express, The Export-Import Bank (Ex-Im Bank), The Overseas Private Investment Corporation Overseas OPIC, the Department of Agriculture, and the National Association of State Development Agencies.
Wade Henderson – very Professional – 15 yrs in the Business Finance Field – strong reputation for getting the deal done. IMMFinancial.com Small Business Factoring Receivable Financing
