3 Things You Should Know about Export Financing

3 Things You Should Know about Export Financing

When your company starts to sell to overseas customers you need to know about the export financing options available to you. Your bank may not be comfortable with the extra risks associated with foreign sales and when it comes to export financing in Kennesaw, GA, there are a lot of details that you might not know about.

  1. What is export financing? Export financing helps companies grow their sales to overseas markets. When you ship a product to another country, it isn’t as quick of a process as if you were to sell it to someone right there in your own city. Due to this, it doesn’t hurt to get some extra help with export financing. Both you and the seller want to receive payment as quickly as possible, but the buyer doesn’t always want to pay for the product until it’s in hand. Export financing will help you provide a more flexible payment program for the buyer, creating money for you quicker than ever before.
  2. Most buyers need credit from their suppliers due to a lack of money before selling the product. You aren’t always going to have money from a product until you get rid of it. As an exporter, it will help you in the long run if you provide credit for a specific amount to your buyers. Of course when you give credit to your buyers, you face several problems. You have to wait a specific amount of days to get money from them. You’re exposing yourself to delayed repayment by offering credit, but more people will purchase your product if you offer credit to get it. If the buyer goes bankrupt and is unable to pay you, then you will suffer a bad debt loss for what you’re owed.
  3. Export financing helps with all of these risks. Pre-shipment finance and post-shipment finance are both forms of export financing that can provide capital payment to the exporter during the shipping process. Pre-shipment finance will provide you with money before the shipping process, while post-shipment finance is provided in order to meet capital requirements after the goods are shipped.
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