Your goods are pre sold but you don’t have the working capital to purchase your goods in advance. XL Business Finance has over 10 years experience helping businesses with trade finance facilities and has a number of alternative solutions.
For one reason and another many businesses are struggling to obtain financial support from existing high street banks. This is never more true for businesses looking to import goods and products from abroad. The problem is that you have an order in the UK, your goods have been pre sold, however you don’t have the working capital to purchase the goods in advance. Whilst banks do a certain amount of trade finance it is usually for existing and well established customers with very strong and profitable balance sheets. Banks generally will not support businesses trading for less than 3 years and very rarely will help businesses with marginal credit.
The good news is that there are a number of independent trade finance companies that may be able to assist. It will certainly be easier if your goods have been pre sold as not only will the stand alone trade finance companies potentially help but also there are a number of factoring companies that also offer trade finance solutions. This is the preferred option for many businesses as a complete financial solution is provided form start to finish. A trade facility is provided for the business to import the goods and once an invoice has been raised in the UK upon delivery the trade finance facility is repaid via a factoring or invoice discounting facility. This factoring facility is repaid when the customer pays the invoice at a agreed future date, ie 30,60 or 90 days hence.
Tags: Factoring, trade finance
