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Why do you need Export Financing? |
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Written by Wade Henderson
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Tuesday, 02 June 2009 11:58 |
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Exporting can be a good opportunity for small businesses to enter foreign markets and raise their business globally. To exploit this possibility, it is often necessary to seek Export Financing.
by WadeHenderson
Exporting can be a good opportunity for small businesses to enter foreign markets and raise their business globally. To exploit this possibility, it is often necessary to seek 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.
Marketing is another big requester for Export Financing. Your company needs to invest in well developed advertisement and marketing for your product to be known in the other country. Exporters often go to international fairs to hire translation services for their brochures, catalogues and websites. All those expenses are costly.
Companies also resort to Export Financing in order to honor the commitments they have with foreign investors that are expecting their products or services to be delivered punctually. Export Financing help companies to be able to increase their working capital and withstand the high costs of machinery, equipment, and property needed for exports.
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.
What are some possible sources of Export Financing? First of all, you should go next door to the bank you already work with. If they are unable to help you with funding, you need to start considering going to a large bank. However, these institutions might not be eager to help you either.
If that is the case, you should look into the options provided by the U. S. Government. Export Financing can be offered in the form of loan guarantees that allow your company to obtain funding from commercial banks.
The Federal Agency for the Development of Small Business (SBA) has some Export Financing options. Here we show a few of them: 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.
About the Author:
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 |
