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.
During the initial phase, because there is a need for investigating foreign markets and investing which takes time and resources.
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.
When purchasing or making your products or services developed for export, because once it has received an order from a customer in another country or expects to receive orders the exporter will need working capital or financing to purchase machinery, equipment or property.
Additionally Export Financing allows companies to outstand the payment periods. Exporters tend to have a waiting period of 90 to 180 days before they collect their benefits. Not having enough cash flow for your operations can put your company in trouble.
Then, were do I find Export Financing for my company? The easies first step is to go the bank your company already works with, the one you have a strong relation with. If for any reason this bank is not a good source of funding for your exports, then you need to start a relation with a larger bank. It is not strange to hear big banks not wanting to take risks of this type.
There are several programs financed by the U.S. Government that offer Export Financing through loan guarantees which allow exporters to apply for extra funding from commercial financial institutions, relying on these guarantees.
If you are interested in finding more about Export Financing from the US Government, do a little research into options offered by the Federal Agency for the Development of Small Business (SBA). Here we give you some examples on programs that can be useful for you: 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.
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