New and small businesses may have trouble with unexpected booms in business or other logistical concerns. Pre-export financing is a method of securing liquidity to handle various operations you may not be able to afford with your present operational capital. New exporters or smaller outfits looking to expand should keep the following in mind when it comes to pre-export financing:
- Easier cash flow management. If you recently opened for business, taking on additional debt may not sound like the most attractive option as you find your stride. However, pre-export financing can provide your business with the ability to expand much more quickly than it would otherwise be able to do. The extra liquidity from pre-export insurance can help your new business have a strong start.
- Resources when you need them. A buyer may suddenly triple its company’s usual order, and filling it would require devoting your entire workforce. The order would empty your warehouse as well. But, you have dozens of other clients waiting. What do you do? Pre-export financing can help you restock your inventory quickly, so you can consistently meet customer demand.
- Invest in your growth. Pre-export financing can bolster your human resources. Hire additional staff, offer more-comprehensive training programs, give your workers a pay raise, or offer overtime for your busier seasons. Pre-export financing can allow you to optimize your workforce and get operations running smoothly.
- Entice potential buyers. When you have more liquid assets at your disposal, it’s easier to be more relaxed with your clients. Pre-export financing could allow you to offer far-more-attractive payment terms to your buyers by supporting your cash flow. It’s true you have to spend money to make money, but with pre-export financing, you can make big plays much sooner than you may have expected and with greater surety.
New businesses may hesitate to take on additional clients too quickly or offer lenient payment terms to buyers. A pre-export financing company can help eliminate these worries as well as offer more operational spending power in your organization’s early days.
