Businesses need finance for a variety of reasons, it might be to tide the business through until large invoices are paid, or it might be to acquire essential assets that the business needs and when essential funding is needed, the business owner does not have time on their side.
Trade finance means that you can pay your suppliers as agreed, even though you have not yet received payments from customers; the lender sets up a working agreement, such as:
- You submit supplier invoices which are paid
- Pay before goods are shipped
- No letter of credit requirement
Once you make good use of Australian trade finance loans, your business can continue to operate, regardless of whether you have the funds or not and with extendable terms of up to 150 days, you can get through those difficult periods.
Foreign & Domestic Suppliers
If your suppliers are located abroad, that is not an issue when you apply for trade finance and invoices are paid prior to goods shipping, empowering your business by ensuring smooth delivery. If you would like to learn more about trade finance, search with Google for a leading Australian lender who specialises in commercial projects and they would be happy to answer any questions you may have.
Dealing with Late Payments
Many businesses have to wait for invoice payments, as our customers are also part of a chain and they may be waiting for a client payment before they settle with us. You can miss out on crucial contracts if you are not in a position to act and waiting for payment should not be a reason to hold you back, which is why many B2B companies use trade finance. If you are looking to develop your leadership skills, click here.
As the business owner, you should be doing what you can to minimise risk and when used correctly, trade credit can mitigate some of these risks. No one wants their business to suffer due to something out of their control and trade finance empowers a business, enabling payment of invoices, as and when necessary.
Tailored Business Loans
Today’s online commercial lender can set you up with tailored trade finance within a few hours, plus they offer other finance options, such as:
- Commercial construction loans
- Working capital loans
- Supply chain financing
- Commercial bridging loans
Importing can be incredibly complex and so many things can go wrong; when you have a trade financier in your corner, they ensure that your business enjoys smooth deliveries and payments to foreign suppliers.
Paying Deposits to Suppliers
Very often when placing an order, the supplier requires a hefty deposit before they will get to work and trade finance can enable your suppliers to receive the required deposit amount, which is one more obstacle to overcome. Of course, it is perfectly understandable for a manufacturer to want to see some money when you order 250,000 units and that is one way trade finance can assist your business.
Here is some Australian government information on the economic outlook in 2022, which is worth reading.