Export factoring: A golden business opportunity?

21/02/2017

As we begin to come to terms that our exit from the European Union is unlikely to see us left with a tidy single market trade deal, and the Prime Minister’s words echoing in our ears that “no deal is better than a bad deal”, businesses who export their goods and services to the European market may find tariffs to and from Europe could reduce profit and cause a slowdown in business.

Due to the ongoing uncertainty in the market, it would seem a logical and worthwhile exercise for businesses to look at extending their sights further afield, with the likes of Australia, India and the US likely to be attracted to the current weak pound.

And what better way to turn the tides on a gloomy outlook for British businesses than to expand our horizons and trade further afield. It may not always be plain sailing, but, with the appropriate methods in place to protect your business, there’s potentially a lot to gain.

So, what has export factoring got to do with it?

When trading overseas it’s a common problem for businesses to experience cash flow pressure, due to the lengthy payment terms resulting from the time it takes your product or service to travel the distance it needs to.

This often causes cash flow to be tight, and business to be uncertain. Opportunities may be missed due to a lack of available capital to invest into securing new business, while day-to-day cash pressures can mount if not managed carefully.

Export factoring, part of the invoice finance family, overcomes these challenges by allowing businesses who export overseas to receive up to 90% of an invoice’s value within 24 hours of issue, and the remainder – less the factoring company’s fees – forwarded once the customer pays. Other benefits of export factoring include:

• Invoice amount advanced in preferred currency, avoiding fluctuations in exchange rates
• Professional and multilingual sales ledger management included
• Can includes debtor protection, leaving your mind at ease
• Increased time to spend growing the business

The added value of these additional services will serve the business by stabilising and securing cash flow, leading to confidence and future growth. If you would like to find out more about export factoring, click here.

Britain and the Commonwealth

As this post-Brexit climate begs for new relationships with the wider world, Britain is beginning to assemble a team of negotiators to seal the deals we need to foster a prosperous UK business community.

Recent reports have speculated the International Trade Department is due to outsource overseas negotiators to come together in order to secure Britain’s trading future. This could be a result of the suddenness of Brexit, and due to the previous reliance held in Brussels rendering a strong trade negotiating department redundant for the past 40 years.

The trade minister Greg Hands has commented: “We are genuinely pleased and impressed with the willingness of our traditional friends and allies with helping us do something that Britain hasn’t done for 40 years.”

He added: “What the Prime Minister has been absolutely clear on is ensuring that trade is at the heart of our Government.”

Be an early trade adopter

Despite the uncertainty and apparent gloom regarding the UK’s international trade deals, some promising opportunities still exist for businesses which are prepared to seize them.

Nevertheless, as we all know, time goes too fast. So, preparing your business for the changes and capitalising on the attractiveness of the weak pound will ensure you’ll be set up for future success.

To find out more about export factoring, our friendly and experienced team would be pleased to help. They can be reached on 0800 9774833 or emailed at info@hiltonbaird.co.uk. If you’re curious to find out the costs, but don’t have much time, get an instant quote below: