The UK export market has been growing significantly year on year, with the Government pledging to double the country’s export value to £1tn by 2020. And while UK SMEs make up 99% of all businesses, fewer than 20% of SMEs export to international markets, compared with over 40% of large companies.

So with the global spotlight firmly on our Government and its plans to help UK businesses succeed in a post-Brexit world, it is vital to ensure that SMEs can fulfil their export potential.

For New and Growing Companies looking to finance foreign trade getting the right advice is crucial. Come and talk to experts at Informed Funding’s Export Challenge: Profits and Cash Generation seminar on 23 February 2017 at Kennington Park.

Customers of the Workspace Group have free premium access to all sessions including the evening event. Click here to register.

Lack of financing is a major constraint to SMEs wanting to export as they are in large part reliant on a few banks; and bank lending, which has been declining since 2008, is not meeting their needs. Trade finance facilities from banks have also generally been more difficult to negotiate recently as SMEs often don’t fulfil certain bank lending criteria. At the same time, traditional capital markets are not open to SMEs in the way that they are to larger companies.

As with financing, lack of expertise in managing foreign currency volatility is a major concern for UK SMEs trading abroad. Many do not have the dedicated skills to deal with foreign exchange risk on export that can potentially lead to a contract becoming loss making and ultimately threatening the viability of the export initiative.

Key learning points from EFM

Finance your exports

  1. Research which type of finance best suits your requirements - traditional banks or alternative lenders.
  2. Investigate Government-backed funding.

Manage your currency risk

  1. Avoid speculation and secure your margins through a fixed rate or forward exchange contract, protecting you from any unexpected currency fluctuations.
  2. Shop around: Compare quoted exchange rates from your bank or a specialist transfer provider against the current market rate to see how much of a margin you’re being charged.

Mitigate your risk of non-payment

  1. If you are concerned about whether your customers’ ability to pay, try and negotiate payment up-front or setup payment in stages. 
  2. Protect your business from late (or no) payment; insure against non-payment of export invoices.

For New and Growing Companies looking to finance foreign trade getting the right advice is crucial. Come and talk to experts at Informed Funding’s Export Challenge: Profits and Cash Generation seminar on 23 February 2017 at Kennington Park.

Informed Funding seminarsPerfect networking opportunities

 

Customers of the Workspace Group have free premium access for all sessions including the evening event. Click here to register.