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Step 9: Obtaining finance/resources for your exports

You are here:Step 9: Obtaining finances/resources for your exports > Alternative sources of financing


 

 

Alternative sources of financing

 

There are several alternative sources of financing. For example, the Industrial Development Corporation provides financing for capital and other types of exports. The Small Enterprise Development Agency (seda) assists in finding financing for small businesses and there is no reason why this should not include small exporters. Various regional development agencies provide financing for local firms and you might want to consider these.

Getting buyers and suppliers to help

Do not loose site of the possibility of the buyer helping to finance the sale. To begin with the buyer (particularly when buying capital goods) may be prepared to out down a deposit to help finance the deal. In addition, they may be prepared to make periodic progress payments based on a third-party report or some other confirmation that certain agreed-upon percentages of the project have been completed.

Similarly, your suppliers may be willing to extend credit to you if you can assure them of the export deal. The credit you receive from your suppliers will certainly help in financing the project, although they will expect some reward for assisting you in this way (usually in the form of a higher payment or interest charge on the value of the goods they supply you).

Using export intermediaries to help finance your exports

If you are a small exporter and simply cannot find the money to finance your export project, you could turn to an export agent or an export trading house (also referred to as export trading companies) to help you. In this instance, they would probably take over the deal completely and may simply pay you for the goods which they would then sell to the importer making whatever mark-up they choose (even though you may have made the effort to find the customer). If financing is required, they may be in a better position to obtain the financing required to cover the export sale, but they would expect a substantial reward for their involvement and your profits are likely to be cut quite substantially.

 
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Step 9: more information

Step 9: Obtaining finances/resources for your exports
      .Bank financing
      .Payment methods as a means of financing
      .dti export incentives
      .Payment terms and export financing
      .Pricing as a means of financing
      .Export receivables
      .Foreign currency loans

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© Cornelius Bothma

More information on Step 9
Learning to export...
The export process in 21 easy steps
Step 1: Considering exporting
Step 2:Current business viability
Step 3:Export readiness
Step 4:Broad mission statement and initial budget
Step 5:Confirming management's commitment to exports
Step 6: Undertaking an initial SWOT analysis of the firm
Step 7:Selecting and researching potential countries abroad
Step 8: Preparing and implementing your export plan
Step 9: Obtaining financing for your exports
Step 10: Managing your export risk
Step 11: Promoting the firm and its products abroad
Step 12: Negotiating and quoting in exports
Step 13: Revising your export costings and price
Step 14: Obtaining the export order
Step 15: Producing the goods
Step 16: Handling the export logistics
Step 17: Export documentation
Step 18: Providing follow-up support
Step 19: Getting paid
Step 20: Reviewing and improving the export process
Step 21: Export Management
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