And for good reason, since many factors of running a company rely on this liquid asset. As 2025 completes its final fiscal quarter, a few things are prompting the need for cash, including actions to drive growth, technology investments, and meeting order demand for the holiday shopping season.

High on the list of why strong cash flow is advantageous to a company is the financial flexibility it gives them. Strengthening liquidity empowers businesses to actively spot growth opportunities and pursue them, or it can mean pivoting when needed due to changing trade policy and tariffs.

One way a company can strengthen their liquidity position is by utilizing trade finance, or a type of financing where a company sells their receivables to a third-party financial partner in exchange for cash.

Trade finance is used by exporters, importers and others engaged in international trade to execute efficient cash flow management and facilitate growth abroad.

Let’s take a look at what’s happening in the business climate and why cash matters.

Holiday shopping comes early

The holidays are around the corner, and retailers haven’t missed a beat in stocking their shelves for the holiday shopping rush.

Deloitte’s “2025 Retail Holiday Buyer Survey” revealed that respondents placed over half of all their holiday orders by the end of May, choosing to frontload their inventory for the season. May proved to be nearly two months earlier than last year based on the 2024 version of the survey.

The survey also shows that,

“nearly 50% of surveyed retail buyers said they plan to increase sourcing from new vendors, with an average of 35% of holiday orders moving to new suppliers or countries.”

Retailers may be stocking up earlier this year and executing new sourcing strategies, but one thing is staying constant – working capital is a must to get products in store for the holiday season.

To fill holiday orders placed by retailers and buyers, suppliers require ample cash to procure raw materials, increase production capacity, and for other operational costs. Fluctuations in seasonal demand, as is seen with ramped up sales ahead of the holidays, require flexible financing that can grow with the rise in order volumes.

Trade finance does just that, providing scalable funding that accommodates seasonality. In fact, 80-90% of global trade depends on trade finance today.

Importantly, trade finance, which is designed to bridge cash flow along the supply chain and close any cash gaps, helps facilitate favorable (and extended) payment terms between international buyers and suppliers, so suppliers can get paid upfront and importers and retailers can enjoy longer windows to settle their invoices.

With retailers front loading orders 2 months ahead of the typical schedule and reconfiguring their supply chains, having greater access to cash through trade finance allows businesses to sidestep cash flow disruptions, stay nimble, and make necessary decisions in real time, without the worry of liquidity constraints.

AI & automation

AI is no longer some remote new technology on the block. It is here to stay, and there’s a resounding theme that has come with it: either adopt this new breakthrough technology or potentially risk becoming obsolete.

CEOs have gotten the memo.

In leading audit firm KPMG’s recently released “KPMG 2025 Global CEO Outlook”, CEOs expressed their commitment to AI. The survey revealed “over seven in ten CEOs (71%) say that AI is a top investment priority.”

Company enhancements don’t come free. Investing in AI and automation takes liquidity to both implement the technology into operations and upskill and train staff. We can already see this in the case of manufacturing, where automation is increasingly being implemented into factory production lines.

Take Sharpie for example. The marker maker, which nearly moved their entire supply chain to the U.S. save felt tips from Japan, is said to have largely automated production of their namesake pens, as reported in the Wall Street Journal. Sharpie employees, rather than assembling the writing instruments themselves, have taken on the role of supervising production lines.

While Sharpie is a case of both automation and onshoring their supply chain, the idea here is that companies are continuing to make strategic decisions that refresh operations.

Having a position of financial flexibility afforded through trade finance can be helpful while navigating the new business climate.

Financing bigger AI investments, which promote product forecasting and supply chain optimization, may indeed require other sources of capital, but factoring receivables via trade finance can help free up cash flow to support other core functions of the business.

Freeing up cash flow can also be indirectly beneficial for companies involved in mergers & acquisitions and other partnerships, which can be capital intensive undertakings. One major partnership just announced is OpenAI’s partnership with chipmaker AMD.

Case in point: making strategic moves for your company hinges in part on available liquidity, which is what trade finance is designed to do – enhancing a company’s cash levels.

Getting comfortable with the unknown

In 2025, U.S. tariffs have been game changing for international trade. Companies have had to embrace pivoting in one way or another. In some cases, that has meant moving production from Country A to Country B to avoid high import duties. In other cases it has meant gaining market share in new export markets.

When it comes to tariffs, companies have pledged to raise consumer prices as a last resort, after already trying out different strategies.

The theme of uncertainty is now part and parcel to leading a business. While tariffs dominate international trade, other events have shaken up the trade world in recent history like Covid 19, limited shipping capacity on the Panama Canal, and the Red Sea crisis.

Trade finance: the liquidity enhancer

Trade finance is a set of financial instruments used to strengthen liquidity and protect against trade risk, facilitating secure cross-border trade. It is useful for manufacturers, exporters, importers and others engaged in international trade or buying and selling at home.

Here’s how it works. Through export factoring, a type of trade finance, a company can sell its unpaid receivables to a third-party financial provider in return for cash. This mechanism allows suppliers to receive payment for their orders right away, rather than having to wait the 30+ days common in today’s payment terms.

Export factoring allows companies to enhance their liquidity, improve cash flow, achieve financial flexibility, and drive sustainable business growth.

In some cases, it also includes credit protection, ensuring payment to the supplier in the case of buyer default, and collections services, streamlining payment receipt in foreign markets. Both credit protection and collections are set up by the third-party factoring partner.

While export factoring focuses on cash flow for the supplier, supply chain finance optimizes working capital for the entire value chain. Supply chain finance arrangements are typically initiated by the buyer, and guarantees early funding for the vendor while allowing the retailer to enjoy longer payment terms – and hold onto their cash.

In essence, both export factoring and supply chain finance are win-win solutions for buyers and suppliers to negotiate more favorable payment terms and optimize liquidity levels.

Financial flexibility in today’s shifting trade environment

International trade and the overall business climate are experiencing a lot of change, from AI adoption, to shifting supply chains, to new trade policies dictated in large part by U.S. tariffs.

Given shifting supply chains, accelerated purchases by retailers, and the looming threat of trade uncertainties, financial flexibility is more valuable than ever.

By monetizing receivables through trade finance and eliminating the long wait of payment terms, companies can access cash to make decisions in real time. This fast funding gives exporters and manufacturers the leeway to adapt and stay nimble when new growth opportunities arise or if any headwinds shake up the international trade climate and they need to play defense – and offense.

In times like these, where business conditions can change at a moment’s notice, maintaining strong liquidity is a competitive advantage for companies to stay nimble and execute business decisions, fast.

Factoring and trade finance are useful financial solutions to generate immediate liquidity and protect and elevate your business, now and in the future.

The post Strengthening liquidity is crucial in today’s trade environment – here’s how your company can free up cash flow appeared first on Trade Ready.

Making the leap from domestic sales to an operation that’s doing business internationally comes with a new range of considerations. Not least of these would be to calculate business costs in any new markets.

Any business exploring a new international market needs to taking into consideration new costs such as those associated with international shipping, currency exchange, and methods of payment, many of which are unique to international business and come with associated risks.

Organizations trading abroad must understand the different factors that can affect their business costs. These factors are shown in the following image and explained below.

1. Transmission delays

Transmission delays, an often-overlooked cost of doing business abroad, can affect cash flow significantly. International shipments and the resulting payments are complex enough—delays can slow the transmission of funds from the paying country to the receiving country by a few days to several weeks. The cash budget must consider the possibility of technical or bureaucratic delays along the payment chain.

The delays may be the result of improperly completed documentation or foreign administrative procedures. New exporters may be able to plan for the types of delays experienced in their domestic business, but they can be unpleasantly surprised when international business delays are far longer than they expect.

2. Exchange controls

Resulting from the host government’s attempt to conserve its hard currency reserves, exchange controls can prevent or restrict the payment of funds by the trading parties in a country. Often enforced by a cumbersome and lengthy system of foreign currency authorization, these regulations impose more problems for capital repatriation transactions than for payment of arm’s-length invoices.

At times, export controls can result in all payments being stopped. This can have a devastating effect on a company’s cash flow, and it should be insured against if the amounts involved are relatively large.

Want to learn more about all aspects of how to manage business costs and cash flows, ensure payment and stay profitable long-term? Get started with the FITTskills International Trade Finance online course!

3. Exchange rate fluctuations

Foreign exchange rate (FX) fluctuations can reduce the value of the proceeds from a sale or increase the value of the funds needed to pay for a transaction. Unless planned for and controlled through risk management techniques, such fluctuations can seriously undermine expected cash flows, or surprisingly increase profit, hence the need for the margin on the contract.

4. Political risks

Political risks can also severely affect a company’s cash flow. For instance, the revocation of an export or import permit frustrates performance under an international trade transaction. In the meantime, the exporter may have already covered the costs of arranging for the export sales, purchased supplies, fixed business costs, paid salaries or prepared the products for shipment. Such a situation will have an obvious negative impact on cash flow.

5. Delayed collection of receivables

The slower collection of international accounts receivable can strain a company’s cash position. To avoid this, care must be taken to select appropriate payment terms for each foreign buyer, and to factor likely delays into the cash budget. If the receivables involved are substantial, the exporter should use export credit insurance or export receivables discounting facilities to avoid excess risk.

6. Technology

Trade finance and logistics providers are investing significantly in the enhancement of technology and related reporting capabilities, working to turn the provision of timely information and high transactional visibility into a significant element of their value proposition to importers and exporters on a global basis. Technology—from processing systems to web-accessed software and sophisticated reporting systems—is enabling the delivery of trade finance solutions across the life of a transaction, and doing so at an ever-faster pace, to keep up with the evolving needs and increasing expectations of importers and exporters.

The latest developments in trade finance include significant forays by leading global banks into areas that traditionally have not been the purview of trade bankers but are increasingly so today. Logistics, customs brokerage, supply chain finance and management are all information areas that are of critical value to importers and exporters.

The post 6 factors that can significantly affect your business costs appeared first on Trade Ready.

New technologies are altering the face of trade finance, bringing a host of opportunities and challenges for corporate treasurers. Joon Kim, Global Head of Trade Finance Product and Portfolio Management at BNY Mellon Treasury Services explores the changing trade finance landscape.

Having remained largely unchanged for decades, the trade finance industry is now experiencing a significant transformation. The combined force of technological innovation, shifting client demands and the unprecedented Covid-19 environment are propelling trade finance toward a digital future.  

New automated technologies available to banks

The implementation of new technologies – from machine learning and optical character recognition (OCR) to digital signatures and distributed ledgers – lies at the heart of these digital efforts, and is helping to transform the historically time-consuming, manual-intensive and paper-based business of trade finance into a streamlined and efficient machine.  

While these rapid changes are posing fresh challenges, they are also opening up a range of opportunities for banks to better support their clients. And as these solutions begin to deliver on their potential, we are now on the cusp of significant gains. With this in mind, what can banks do to ensure they can continue to drive this digital transformation?  

Obstacles in compatibility to overcome

Almost 80% of trade finance is now conducted in the open account space, where goods are shipped and delivered before the payment is due. While it has become by far the most prevalent means by which to conduct trade finance, several weaknesses remain – including the lack of a network to effectively and securely exchange information  

In lieu of such a network, treasurers working in the open account space typically have to structure their trade finance deals on a bilateral basis and onboard several different proprietary systems.

Not only is this a time-consuming process, but it also brings a number of complications. For instance, it creates a system that is more susceptible to financial crime.

With no standard network to exchange information, fraudsters can use a single invoice to obtain multiple lines of credit from different banks.

The turbulent landscape created by the COVID-19 pandemic, which put extreme pressure on global supply chains and liquidity, served to exacerbate these issues. As a result, it became clear that an effective and secure system was needed to support, facilitate and optimize open account transactions.     

Industry collaboration is key

In order to make open account trade more secure and efficient, several networks are being developed – and industry-wide collaboration is proving key to their success.  

One such example is the Marco Polo network, a  consortium of approximately 45 banks that leverages blockchain technology to provide an open software platform for trade, payments and working capital financing. The network is removing the need to integrate a host of external systems and replacing this with a single point of access on a cloud-based blockchain-powered network.  

The use of blockchain technology means that the moment both parties agree that the transaction terms are correct, the trade can be confirmed in real time.

This means the data in trade documents can be checked, matched and confirmed by both parties almost instantly. This is also reducing the risk that the same trade instruments could be used to secure working capital from multiple liquidity providers.  

By enabling the seamless, secure and fast exchange of trade information and transactions, partner banks are able to more efficiently insert liquidity into the international supply chain via a host of supply chain finance solutions, including both payables financing and receivables discounting.

Working towards a more efficient trade finance future

Trade finance is truly transforming, with the use of emerging technologies driving efficiencies and streamlining processes. But, while significant progress has been made – particularly with the COVID-19 pandemic pushing the industry away from the paper-based processes and towards digital alternatives – the era of digital trade finance is only just beginning.

Banks will need to keep up with the pace of change, participating in the industry initiatives, such as the Marco Polo Network, and investing in cutting-edge technologies – ensuring they can provide the support, tools and solutions their clients need to flourish in the new digital world. 

The post New technologies changing the trade finance industry appeared first on Trade Ready.

The new Canadian Federal Budget 2021 outlines plans for a total spend of $101.4 billion. With new pandemic business support options, including $17.6 billion towards cleantech innovation to combat climate change, it plans for a strong recovery and growth for all Canadian businesses.

SMEs and other businesses looking to understand how the budget can help their industry, business or other professional endeavors can check out the list of proposed initiatives below:

New options for small business recovery and growth

The budget proposes to provide continued business support during COVID-19 including:

• $12.1 billion in additional COVID-19 support to extend the CEWS, CERS, and lockdown support options for businesses and other employers until September 25, 2021.
• $4 billion for the new Canada Digital Adoption Program to help up to 160,000 small and medium-sized businesses buy the new technologies they need to grow and train up to 28,000 young Canadians.
• $2.6 billion to the Business Development Bank of Canada to offer grants, loans, incentives, and further business support options.
• $595 million for a new Canada Recovery Hiring Program (CRHP), which will run from June to November 2021, and will make it easier for businesses to hire back laid-off workers and/or to bring on new employees.
• $560 million to improve the Canada Small Business Financing Program.
• $500 million to revitalize community spaces through the Canada Community Revitalization Fund.
• $470 million over three years, beginning in 2021-22, to Employment and Social Development Canada to establish a new Apprenticeship Service.
• $101.4 million to create a Small Business and Entrepreneurship Development Program.

Funding investments for Canadian cleantech innovation

The budget also proposes to provide cleantech innovation investments including:

• $7.2 billion over the next seven years for the Strategic Innovation Fund (SIF).
• $2.2 billion to strengthen Canada’s biomanufacturing and life sciences sector.
• $500 million to the Industrial Research Assistance Program (IRAP).
• $450 million renewal of VCCI, with $50 million dedicated to life science tech and $50 million to create a new Inclusive Growth Stream to increase access to venture capital for underrepresented groups, such as women and racialized communities.
• $443.8 million for the Pan-Canadian Artificial Intelligence Strategy.
• $400 million over six years, starting in 2021-22, in support of a Pan-Canadian Genomics Strategy to kick-start the new strategy, and complement the government’s existing genomics research and innovation programming.
• $360 million over seven years, starting in 2021-22, to launch a National Quantum Strategy.
• $90 million over five years on a cash basis, starting in 2021-22, to the National Research Council to retool and modernize the Canadian Photonics Fabrication Centre.
• $60 million for the Innovation Superclusters Initiative.

Support options and opportunities for Canadian youth

There are also plans to provide a wealth of support to Canadian youth including:

• $4.1 billion to provide direct support for more affordable postsecondary education.
• $721 million over the next two years to help youth connect with employers and provide them with over 100,000 new, quality job opportunities.
• $100 million over three years to support projects for innovative mental health interventions and support programs.

Further notable federal budget 2021 investments

To ensure that Canada prevails in the global fight against COVID-19, creates a stronger economy for all Canadians, and advances in cleantech innovation, the plan will invest:

• $3 billion over five years, starting in 2022-23, to support the provinces and territories in creating and upholding high standards of care inside long-term care facilities.
• $424 million in 2021-22 to ensure the “safe reopening” of Canada’s borders, through funding further air travel protections and mandatory quarantine measures.
• $375 million to Global Affairs Canada to support Canada’s international COVID-19 response, with a focus on addressing the health needs of developing countries. This would facilitate the world’s poorest countries to access the tools necessary to help contain the spread of COVID-19.
• $271.1 million in 2021-22 to CATSA to maintain operations and enhanced screening services at the 89 airports where it works.
• $195 million over two years, starting in 2021-22, to Health Canada, the Public Health Agency of Canada, and the Canadian Institutes of Health Research to help develop national mental health service standards, in collaboration with provinces and territories, health organizations, and key stakeholders.
• $82.5 million in 2021-22 to Transport Canada to support major Canadian airports in making investments in COVID-19 testing infrastructure.
• $41.3 million over six years, starting in 2021-22, and $7.7 million ongoing, for Statistics Canada to improve data infrastructure and data collection on supportive care, primary care, and pharmaceuticals.

Additional federal budget 2021 funding and programs

To learn more about the overall breakdown of the Federal Budget 2021, including options for industry-specific support, regional support, municipal and non-profit support, and other additional support options for Canadian businesses, please read the detailed overview of the Federal Budget 2021.

The post Federal budget 2021: New support options for Canadian businesses appeared first on Trade Ready.

However, if you run a small to medium-sized business, you might be surprised to learn that big banks still provide major benefits to SMEs, especially when it comes to new digital services in the arena of global trade.

Specifically,

by leveraging their extensive networks, international banks have created innovative digital platforms that help SMEs execute several traditional trade tasks, such as finding and accessing foreign market data, and using data analysis, algorithms and blockchain for business matchmaking and payment solutions.

In most cases, banks have decided to combine forces and offer their services together, providing an easier way for SMEs to manage business internationally. Interested in some of the more popular banking and trade solutions for SMEs in international business? Here’s a useful list below.

we.trade

When people think about banks and trade, a name that immediately pops in mind is HSBC. Along with other 15 banks, and in partnership with IBM, the former Hongkong and Shanghai Banking Corporation established we.trade, the first international trade platform based on blockchain.

What Is we.trade?

Essentially, by sharing credit data with all the other members, and being completely digitized, we.trade aims to solve the two main issues in international trade:

• Finding a trusted partner
• Getting paid

When the parties carry out a transaction on the platform, one party will tick the box requesting a letter of credit. A network bank will pick up the call and authorize the credit.

At that point, the seller is sure to receive payment by the authorizing bank, or another network bank, with any documentation or bureaucratic requirement being done online.

We.trade was launched only in 2019 and it is a relatively new service. Member banks are: CaixaBank, Deutsche Bank, Erste Group, HSBC, KBC, Natixis, Nordea, Rabobank, Santander, Société Générale, UBS and UniCredit.

Club Trade Alliance

Started at the same time as we.trade, Club Trade Alliance focuses on two more basic issues for SMEs approaching international trade:

• The world is huge: where is the best place for me to find local partners?
• How can I find local partners that I can trust?

Club Trade Alliance answers to these needs by offering comprehensive market data of almost any country on the planet (around 25,000 market reports from 186 countries). There are market trends, country economics, and also tariffs, regulations and tax matters. 

Moreover, Club Trade Alliance claims that it can combine this data to provide its SME clients with the perfect market and the perfect partner. In fact, there are more than 21,000 members offering 80,000 opportunities, according to the company’s website. Being all backed by banks, trust should not be an issue.

Club Trade Alliance was originally sponsored by Banco Santander, Spain’s largest bank, and now includes a network of other 13 banks: Abu Dhabi Commercial Bank, Attiijariwafa Group, Royal Bank of Canada, CIMB, Crédit Agricole Group, Eurobank, KBC Group, Industrial Bank of Korea, MUFG, Nordea Group, Siam Commercial Bank, and Standard Bank.

Opportunity Network

This banking marketplace, also called ON, was originally founded in 2014 almost entirely backed by Intesa SanPaolo, Italy’s largest bank.

Since then, it has evolved into a network of 30,000 members, backed by several global banks, including Credit Suisse, UBS, Citizens Bank, YPO, Intesa Sanpaolo, Vietinbank, Sterling Bank, and ABN Amro, according to the ON’s website,

In the beginning, ON accepted only medium-large companies (the minimum acceptance rate used to be USD 1 million), and companies had to be invited by a member bank.

Nowadays, however, any company with revenue above USD 2.5 million can join the platform after going through a sanction-free and anti-money laundering (AML) check. They also now offer a LITE membership for start-ups and small companies with over USD 250k in revenue or liquid assets.

ON is truly and solely a matchmaking platform: Members post what they need and the marketplace’s algorithm should match them with comparable businesses looking for the same thing.

The solo banks

Some large banks have decided to go alone and provide business matchmaking services using their own networks exclusively.

The following three are the most relevant:

Industrial and Commercial Bank of China

ICBC launched ICBC Business Matchmaker with the goal of making it easier for Chinese companies to find foreign buyers, and vice versa. If you are familiar with trade in China, you will know that sourcing a proper supplier is not a trivial task. This service aims to make this task easier.

China Construction Bank

CCB also joined its domestic competitors by launching CCB Match Plus, this year. The aim is the same as other matchmaking platforms, but CCM Match Plus combines a digital marketplace with physical events, such as trade fairs and exhibitions.

The interesting thing about these two Chinese platforms is that they are not confined just to merchandise, but offer opportunities also in real estate, infrastructure, and renewable power, for both investors and operating companies.

Lloyds Banking Group

The British conglomerate launched Lloyds Bank International Trade Portal back in 2016, a platform that helps its SME clients export to new markets. The platform resembles Club Trade Alliance in its focus on market trends and regulations. However, it offers only a directory of potential partners and lacks a matchmaking process.

Alternatives outside the banking industry

Banks have made vast digital improvements in the arena of international trade and business—especially for SMEs. Yet, international trade has been running on other digital platforms for roughly 20 years. The most important and well-known online B2B platforms are Alibaba, GlobalSources, DHGate, eWorldTrade and go4WorldBusiness.

While hosting hundreds and thousands of small businesses and trading products of any kind in huge volumes, these platforms function exactly like big markets, where buyers and sellers trade a single item (or a single batch).

Businesses interested in non-banking marketplaces similar to ON or Club Trade Alliance, i.e. platforms that encourage business matchmaking, should look at the likes of Enterprise Europe Network and Globartis.

These new platforms encourage firms to find long-term partners to establish solid partnerships. You will not have the assurance that a bank may provide, but the application and connection process is much more streamlined.

The post How banks are supporting SMEs and global trade through their own digital marketplaces appeared first on Trade Ready.

Mamdouh Elkharadly’s journey into international trade began in 2003 when he started working for a multinational shipping company called Pacific International Lines. That’s when he was introduced to many of the abbreviations and terminology related to Incoterms®. It wasn’t long before he was deeply involved in the import-export processes of the business and found himself taking a keen interest in all matters pertaining to international trade. 

“I got so excited about being part of every single importing/exporting transaction taking place, and this is where I started getting more interested in the various aspects of international trade.”

Providing custom financing solutions for mega infrastructure projects 

After working at the shipping company for five years, Mamdouh obtained the required certification to make the transition into finance management. He went into corporate banking as a relationship manager, where he was actively involved in many of the operational transactions, including importing raw materials and opening Letters of Credit. Mamdouh’s favourite career story was when he successfully created a tailor-made financial solution for one of the most sophisticated mega infrastructure projects in the Middle East.  

“I was also helping my client manage their cash flow. I enjoyed being part of this cross-border project as it helped me widen my vision. I learned a lot from this complicated transaction.”

This was only the first of many successes for Mamdouh, as he continued to offer expert financing options for other high-profile ventures in the region. Some of the projects that he and his team helped secure finances for included the construction of a couple of the most prominent airports in the Middle East. 

Earning the CEO Star award: his proudest professional accomplishment 

By creating and managing multiple financial solutions for clients, Mamdouh helped enhance the company’s profitability by 20%, thus making him the most deserving candidate to win the CEO Star award from his previous employer. He’s also earned the Top Performer award on two other occasions.

The importance of positivity and patience 

A piece of advice he wishes to share with those at the outset of their career in international trade is to always maintain a positive attitude and have patience with the results. 

“Being part of the international trade chain requires a lot of patience due to several factors, such as time differences, bureaucracy in some countries and multiple cultures. I have implemented these attributes [positivity and patience] since day one, and they’ve really helped.”

Inching closer to his goal by adding a new credential to his professional repertoire 

As one of his short-term goals, Mamdouh aspires to join Export Development Canada (EDC) and contribute to the efforts of the Canadian government to help the Canadian economy grow. The export credit agency offers trade finance, export credit insurance and trade-related advice to businesses to support and develop trade between Canada and other countries. He believes his experience gained from working on several strategic projects in diverse markets would most certainly be an asset for Canadian businesses looking to expand to foreign shores.  

To further boost his candidacy, Mamdouh applied for the CITP®|FIBP® designation, which is a benchmark of competency and credibility for global business professionals. He earned the credential in November of 2020 and is thrilled to be a part of the elite group of CITPs.  

“I will always do my best to be an ambassador for such a designation. I want to protect Canada’s benefits and keep its positive noticeable presence in international trade transactions.”

Focusing on the future 

Mamdouh believes that the industry-backed designation will add value to his skills and help further his career goals. As international business and trade will continue to shape Canada’s economy, the global validation that the designation brings will ensure that he can contribute his efforts with confidence.  

“By being a CITP, I will focus on creating business development opportunities by promoting international trade benefits and solutions, thereby contributing to the growth of exporting trade for my country, Canada.”

It is his vision to facilitate the growth of Canadian businesses by anticipating their needs and paving the way for them to succeed in global markets, while always upholding Canada’s positive brand value.  

As Mamdouh continues to work steadily towards achieving his professional goals, we will be watching with proud delight as he turns his vision into a thriving reality.  

The post CITP Spotlight: Mamdouh Elkharadly – Account Manager, Commercial Banking appeared first on Trade Ready.

How COVID-19 delays could affect your supply chain from contracts to insurance and custom clearance

This article reveals the potential delays and issues that businesses could encounter in the aftermath of the pandemic, from contracts and insurance problems to custom clearance and force majeure cases.

8 helpful tips to improve your customer service quality

The level of customer service your business provides greatly impacts its success. In this article, discover useful tips for improving customer service using feedback, cross-selling, referral programs and more.

9 factors exporters should consider when selecting sales channels

From market location to local business practices, international trade practitioners need to consider several important factors when choosing their sales channels for the distribution of products and services. Learn about the most important ones in this article.

Top 10 most read global business articles of 2019

Last year had some great reads too! This article covered the top ten most popular articles from 2019, giving insights on important trade-related topics that readers loved.

9 ways to reduce the total costs of customs clearance

Customs clearance is an expensive aspect of international trade, but there are many ways to reduce the costs. Learn effective strategies and steps businesses can take to make this process cheaper. 

Choosing the wrong Incoterms® can mess up your contract – here’s how to get it right

Understanding Incoterms® is a critical part of ensuring your contracts and business agreements run smoothly. See how to avoid some common mistakes when using them.

The state of Canadian SMEs involved in international trade

Are you a Canadian SME involved in international trade? This article is a must-read for understanding where small and mid-size Canadian enterprises and businesses are thriving and lagging on the international stage. 

China too risky? Do you need a new strategy for your FDI in the face of COVID-19?

COVID-19 has forced many businesses to re-assess their global strategies over the past year. Get insights on Asia development in the aftermath of the pandemic and see why you should option the ASEAN region.

Act now to minimize your political risk in foreign markets

Political changes in international government can spell big trouble for businesses operating in various regions around the world. To adapt to the disruptions, companies need to make rapid adjustments when these changes occur. Learn some effective strategies for minimizing political risk in foreign markets.

10 things you can do from home to boost your export business

The pandemic has severely limited regular routines for SMEs around the world. However, there are still many things individuals can do from home to support their business during the coronavirus crisis. See which steps you can take from home to foster growth during this time.

The post Best of 2020: Our top 10 most popular international business articles from the past year appeared first on Trade Ready.

On August 22, 2019, the CanExport funding program undertook two significant updates that impacted how the program operated and the value it provided to Canadian exporters. The first and most notable update was to the program’s contribution amount, while the second focused on company eligibility. Previously, agriculture and agri-food companies were unable to apply; these types of applicants are now encouraged to submit funding applications.

Applicants are now able to access up to 75% of eligible expenses to a maximum $75,000. These had previously been set for 50%/$50,000.

All new applications will be considered for the new contribution rate and eligibility criteria, but any applications submitted prior to August 22 will be evaluated under the program’s old rules. Please note that companies can only have one active project funded by the program at a time; despite the program update, all previous successful applicants still need to wait until their supported project activities have completed and all project claims have been processed before they can apply again.

What are CanExport and AgriMarketing grants?

CanExport is a Canadian government grant that offsets the cost of export marketing projects, such as participation in trade shows or missions. Provided federally, businesses and organizations across Canada can apply for this funding to expand export marketing budgets and get more value out of export expansion projects.

AgriMarketing is a now-closed Canadian government funding program that provided funding for many of the same projects and activities supported through CanExport. The biggest difference between the two programs was that AgriMarketing only supported agricultural producers and agri-food processors whereas CanExport supported all other applicant types.

How did these export marketing grants change?

Changes rolled-out to both the CanExport and AgriMarketing funding programs had a direct impact on the way funds are administered:

1. Contribution Increase: CanExport and AgriMarketing grants have historically provided up to 50% of eligible project expenses to a maximum $50,000 per application. As of August 22, 2019, CanExport’s new funding contribution amount increased to 75% of eligible project expenses to a maximum $75,000 per application. This is a significant increase that greatly reduces a business’ export marketing costs.
2. Program Realignment: Now closed, AgriMarketing will no longer process new applications. All applicants, even agricultural producers and processors, are encouraged to use the CanExport program for all new applications. CanExport’s expanded eligibility criteria supports previously ineligible companies, so long as your marketing activities and target market are eligible for funding.

How can businesses apply for CanExport funding?

To apply for CanExport marketing grants, businesses must complete a comprehensive application that includes a detailed plan for expanding sales in global markets. Applicants need to show the value of the project (new leads or revenue), a detailed breakdown of project expenses, and explain why the new market is of strategic importance. Businesses must receive application approval prior to incurring funding-eligible expenses.

To discuss your upcoming project and discuss if it’s a good fit for Canadian export marketing grants, please contact Mentor Works.

The post CanExport funding increases to 75%/$75,000 and supports agri-business appeared first on Trade Ready.

Do you ever find yourself wondering what the best way is to receive payments against invoices for your business? If so, you probably already know that there are lots of ways, both old and new!

Each of these ways have their own advantages and disadvantages. Some tend to have far more financial disadvantages than others, and should probably be avoided whenever possible.

Here we examine the best ways to receive payments – and the pros & cons of each method for your business.

Cheques

The use of cheques has dropped massively thanks to modern technology, yet a surprising number of businesses are still using them to pay employees and suppliers. It’s very likely a few of your customers may still prefer to pay you by cheque.

Pros

• Can now be processed electronically via ATMs and Mobile Banking.
• It costs nothing to accept a cheque and most banks won’t charge you to deposit one.

Cons

• Getting a cheque does not guarantee payment. Cheques can bounce, and this can cost you money and challenges in managing your working capital.
• Sometimes when you deposit a cheque, your bank will put some of the funds on hold temporarily.
• If your bank does not have state of the art technology, you will have to take a trip to your bank and wait in the infamous banking line to deposit your payment.
• Many businesses that pay by cheque do so via mail. Millions of letters get lost by postal providers every year- cheques should never be mailed!
• International cheques may take up to 2-3 weeks to get cashed, thus further delaying receipt of the money you need to run your business.

Wire Transfers

Wire transfers are a popular method used worldwide to send payments both domestically and internationally. These transfers use wire networks that essentially act as a messenger between the banks in an electronic money-sending transaction.

A wire transfer requires a considerable amount of trust between the payer and the payee, as a lot of details need to be shared between the two.

Pros

• Payments via wire transfer go directly into your bank account.
• Wire transfers can be used to receive money from employers/clients overseas.

Cons

• Can take up to 5 business days (and sometimes longer) to be processed, meaning you could be waiting a while for your payment to come through.
• Oftentimes the recipient will be subjected to a receiving fee by their bank, meaning you never get paid 100% of your invoice amount. For example, in Canada, some banks charge a $15 fee to receive a wire transfer.
• You will have to gather all of your bank details and share them with the sender. Sometimes a call or a trip to the bank will be necessary to obtain SWIFT codes, Intermediary bank SWIFT / Routing code, etc.
• Usually, wire transfers are denominated in a major currency like the US Dollars. When selling US Dollars at your bank (e.g., to receive a converted amount in Canadian Dollars), you would be paying a conversion fee as a percentage of the amount you are receiving to your bank based on their current USD buying rates.

Cash

One saying we’ve all heard is that “cash is king” – but has its time come and gone?

Being paid in cash is not very common outside of certain industries, and while it sounds great it is not without its problems.

Pros

• Instant cash in hand, no waiting on funds to become available.
• There are no transaction fees with like there are with wire transfers.

Cons

• Cash is riskier to carry. If you carry cash you may be a victim of theft and lose all your earnings.
• Fraud risk – Cash can be easily stolen at a cash pickup point.
• You will have to make frequent trips to the bank to make cash deposits, which can take up a lot of your time – and you have to rely on banking hours!
• Cash on your company’s premises means there is the potential of theft from both insiders and criminals.
• If your business is in retail or otherwise needs to regularly deal in cash, you may have to invest in secure storage, 24 x 7 surveillance, security vans, etc.

Irrevocable Letter of Credit (ILOC or LC)

You may not have heard of an Irrevocable Letter of Credit – they are quite common for large value contracts but no so much for smaller values or where trust is already established between buyers and sellers.

An LC is a guarantee to the receiver, issued as a commercial document, by a bank. They are most commonly used to facilitate international trade between two parties that are unfamiliar with each other.

Pros

• LCs are issued at your client’s request in your favour.
• An LC means that the bank must pay you, even if your customer defaults.
• You can issue an LC for both domestic as well as international contracts.

Cons

• Once the document has been issued, it cannot be modified without both parties’ consent. The language and phrasing in the documents is crucial.
• If not done by an experienced professional, you could end up being burned due to an unforeseen loophole you unknowingly created.
• To ensure things go smoothly, you will have to talk with your bank. You may even have to arrange a meeting with a specialist, and this can all be rather time consuming.

Money Service Business (MSB)

An MSB is a non-bank financial institution that transmits payments or converts currency.

Money service businesses are a great way to both send and receive money internationally and domestically.

Pros

• Many MSBs use state of the art technology to which banks do not have access.
• Some MSBs ensure payments are received with 1 business day, if not instantly.
• More often than not, using an MSB is several times cheaper than using wire transfer.
• MSBs adhere to FINTRAC regulations in the same manner as a bank.

Cons

• Some MSBs are not geared up to handle business transactions and are limited to personal remittances.
• You may need to look around to ensure you find the best MSB for your needs.
• You want an MSB with the right banking arrangements, a transparent fee structure, modern technology based systems, and great customer service.

My recommendation

Using an MSB has become the preferred choice for many businesses who need to send and receive payments internationally.

The post The pros and cons of accepting different payment methods for your business appeared first on Trade Ready.

Tapping into new international markets presents growth opportunities for businesses of all sizes and yet, as of January 2018, only about 15 percent of Canadian SMEs were engaged in global trade.

SME exporters generate more revenues than non-exporters according to SME Profile: Canadian Exporters, a report by Industry Canada. Evidence shows that exporters generate higher sales, pre-tax profit margins and returns on assets, on average, compared with non-exporters. So why don’t more businesses go global?

Among the many challenges faced by businesses seeking to tap into global markets, finance might be the most fundamental.

So how do small and medium sized businesses prepare themselves to take advantage of the opportunities of going global?

We asked a panel of experts in our latest #TradeElite Twitter chat, to find out how SME’s can best get financially prepared to access new global markets. What we discovered is that there is lots of information, support and assistance for business of any size.  Check out the highlights of the chat  below and you can scroll through the #TradeElite hashtag to follow the entire chat.

Moderator: Nicole Chevrier, Content Marketing Specialist, FITT (@FITTNews)

Panelists:

Scott C. Ferris, @ScottCFerrisPEI,  CEO of The Saddle Up Management Co.  and Biz Dev Professional. Scott established the Saddle Up Management Company after 25 years of experience in export sales planning, domestic and international business development, investment attraction, negotiations and partnership engagement. His experience stems from participating in and organizing more than 30 trade missions on four continents.

Stacey Gordon, @StaceyCGordon, Director, International Trade, ATB Financial. Stacey is the Director of International Trade at ATB Financial, where she introduces trade and helps to remove roadblocks. She previously spent 9 years at EDC where she worked with hundreds of companies at all stages of their export journey.  She teaches International Marketing at MacEwan University, where she hopes to influence the next generation of leaders and entrepreneurs about the advantages of diversification.

Jeff Shepherd, @JeffMShepherd, Marketing Coordinator, Mentor Works Ltd. Jeff is a Marketing Coordinator and Government Funding Planner at Mentor Works Ltd. As an educator about the Canadian government funding landscape, Jeff identifies opportunities where businesses could scale and reach new international markets with grants, loans, and other government incentives.

What are some of the most common financial barriers to international trade for small business?

Q1. What are some of the most common financial barriers to international trade for small business?
A1. Business development spending and Pre-shipment/pre-/service costs #TradeElite

— Stacey Gordon (@StaceyCGordon) October 18, 2018

A1 – in my experience the most common financial barrier is lack of knowledge and lack of preparedness. This can be a daunting area for many companies and a “fear of looking unaware” prevents many from addressing a very important business area. https://t.co/RiWqF1pN9b

— Scott C. Ferris (@ScottCFerrisPEI) October 18, 2018

A1. Supporting upfront and ongoing costs of #internationaltrade is difficult for most small businesses. If outside capital is required, it’s often difficult to secure lines of credit and other sources of investment. #TradeElite

— Jeffrey Shepherd (@JeffMShepherd) October 18, 2018

A1. Monetary systems and dealing with the risk of #currencyfluctuation is often a concern. What currency will you bill customers in? How will you mitigate risk if accepting international currency? #TradeElite

— Jeffrey Shepherd (@JeffMShepherd) October 18, 2018

What’s the best way for business to assess their financial readiness? Is an expert required?

#TradeElite 1. Understand how financing works: ie: which costs can be covered by your FI institution ( ie: cost that are related to a defined cash flow or have assets attached) and which costs will have to be covered out of pocket ( ie: soft costs )

— Stacey Gordon (@StaceyCGordon) October 18, 2018

2. If the area of trade finance or lending is new to an entrepreneur, they should absolutely seek the help of an expert, talk to your banker and enlist the help of financial resources like @ExportDevCanada who can help you understand how to finance trade. #TradeElite

— Stacey Gordon (@StaceyCGordon) October 18, 2018

A2. Upfront costs can range from setting up local offices with foreign personnel and purchasing #insurance to getting product certification and developing new packaging. Ongoing costs include transportation, warehousing, and paying #duties and taxes. #TradeElite https://t.co/PSRsb9ypE6

— Jeffrey Shepherd (@JeffMShepherd) October 18, 2018

A2 – Any business should know its cash flow & assess its overall operations in terms of profit/loss. Beyond this to assess for capital purchase requirements, expansion/growth, new market entry etc. then a detailed examination of available cash, options for financing, is needed https://t.co/QD0Uuq0D1z

— Scott C. Ferris (@ScottCFerrisPEI) October 18, 2018

A2 – #TradeElite Also companies need to have a good understanding of what their expected costs to engage in import/export will be. @FITTNews has excellent resources available through its workshop series with costing worksheets, export plan templates and more

— Scott C. Ferris (@ScottCFerrisPEI) October 18, 2018

A2. While not essential, using experts is advised. Small businesses often lack insight to the long-term financial commitment of exporting; expertise from organizations like BDC provide an objective view and can help show the big picture. #TradeElite https://t.co/PSRsb9ypE6

— Jeffrey Shepherd (@JeffMShepherd) October 18, 2018

What are some tools and resources that small biz can use to gauge their state of readiness?

A3 – #TradeElite Economic development/trade agencies from the municipal, provincial and Federal levels have great resources to help exporters. Of course @FITTNews provides in-depth readiness through its training, but so does @ExportDevCanada @bdc_ca and others. https://t.co/8VHNwITvcB

— Scott C. Ferris (@ScottCFerrisPEI) October 18, 2018

A3. Innovation, Science, and Economic Development Canada (ISED) also provides a comprehensive set of #exportreadiness questions that cover several areas of exporting. https://t.co/hvW4cLHDhy #TradeElite https://t.co/OtU4MdFoLE

— Jeffrey Shepherd (@JeffMShepherd) October 18, 2018

A3. The Canadian Trade Commissioner Service offers an export quiz that helps #smallbiz owners check a range of export readiness factors. https://t.co/nFXk0zilzq #TradeElite https://t.co/OtU4MdFoLE

— Jeffrey Shepherd (@JeffMShepherd) October 18, 2018

A5: #TradeElite 1/2 There are plenty of resources to help small businesses, but there will always be a large responsibility on the company to do as much of their own due diligence as possible, however, here are some resources to consider state of readiness, but provide info:

— Stacey Gordon (@StaceyCGordon) October 18, 2018

2/2A5: #TradeElite @TCS_SDC @TFOcan @calgaryeconomic – Trade Accelerator Program@ExportDevCanada – @cme_mec – Canadian Manufacturers and Exporters @bdc_ca has commercial consulting services to help move your trade business forward

— Stacey Gordon (@StaceyCGordon) October 18, 2018

How do you prepare a financial plan to access new international markets? Where do you start?

1/2
A4:
Where does trade fit in your overall company strategy? What resources is your company prepared to put behind the development of the strategy. Do you want international markets to represent a small portion of your revenue or a larger portion. #TradeElite

— Stacey Gordon (@StaceyCGordon) October 18, 2018

2/3 What is your market entry strategy going to be? There are plenty of ways to sell into foreign markets; you can go in alone, license, use local agents, sell through domestic suppliers already in those markets. #TradeElite

— Stacey Gordon (@StaceyCGordon) October 18, 2018

3/3
Each strategy has their own risk/return ratio and some countries/industries will have more market entry options than others. Research Research Research. #TradeElite once you have a clear understanding of your resource allocation and market entry plan, set up a budget

— Stacey Gordon (@StaceyCGordon) October 18, 2018

A4. Start by analyzing revenues and projected costs in the #export market. Will company #cashflow be sufficient in covering long-term commitments in your new markets, or will you need to secure additional #financing to make it work? #TradeElite https://t.co/e1euH8jDwh

— Jeffrey Shepherd (@JeffMShepherd) October 18, 2018

A4 – #TradeElite – Start with an export costing worksheet. There are many templates widely available and I have mentioned some sources already. But companies will need to know everything from additional production/service delivery costs right through to moving goods into market. https://t.co/CeFQ0GMUEd

— Scott C. Ferris (@ScottCFerrisPEI) October 18, 2018

How do you forecast the cost of getting into a new market?  What kinds of initial costs and ongoing costs are there?

A5 get expert advice local partnership info if possible to minimize risk #TradeElite

— Mike Au (@Mike_Au1) October 18, 2018

@TCS_SDC is a great service for that, they are located in most countries!

— Stacey Gordon (@StaceyCGordon) October 18, 2018

Understanding your market entry strategy, ensuring you are familiar with each step of the supply chain and who is responsible for what.
Your market development plan, invest in resources to determine the plan and budget that allows for some unexpected expenses. #TradeElite

— Stacey Gordon (@StaceyCGordon) October 18, 2018

A5 1/2- #TradeElite Ultimately you will have to have done some extensive research into the target market. As @StaceyCGordon said, know your market entry strategy, sales channel(s), logistics options etc. https://t.co/k6hKs8qzKF

— Scott C. Ferris (@ScottCFerrisPEI) October 18, 2018

A5 – 2/2 #TradeElite Initial costs will be potential prod/service modifications, packing changes, packing, logistics again ( know your INCO terms https://t.co/5Umqwz7GIF) Ongoing costs will include additional shipments, customer care, returns/warranty. https://t.co/k6hKs8qzKF

— Scott C. Ferris (@ScottCFerrisPEI) October 18, 2018

A5. Upfront costs can range from setting up local offices with foreign personnel and purchasing #insurance to getting product certification and developing new packaging. Ongoing costs include transportation, warehousing, and paying #duties and taxes. #TradeElite https://t.co/swKc2oRkYj

— Jeffrey Shepherd (@JeffMShepherd) October 18, 2018

A5. Developing #cashflow forecasts is the best way to understand market entry costs. Developing monthly, quarterly, and annual projections will show what you’ll need to cover in the early stages of #exporting. #TradeElite https://t.co/swKc2oRkYj

— Jeffrey Shepherd (@JeffMShepherd) October 18, 2018

A5. Once #cashflow projections are complete, use a break-even analysis to ensure sales can cover these costs. Are there gaps? If so, explore #financing options. #TradeElite https://t.co/swKc2oRkYj

— Jeffrey Shepherd (@JeffMShepherd) October 18, 2018

A5.
Lipsticks made in Cda sell to EU.
Cost of Goods
+Check Cosmetics Rules
+EU Consultant Fee
+QA Dossier Fee
+New Labels/Packaging
+$ Ship CdatoEU
+Brokerage
+Duty Rate
+VAT
+Origin Port fee
+Local Delivery
+Ads / Marketing
+Exchange Rate
+Mark up
etc.#TradeElite

— audrey ross (@tresAudrey) October 18, 2018

Are the financial implications for getting into global trade different for smaller businesses?

#TradeElite, A6. 1/2 :Smaller business may have a harder time accessing capital and financing the “startup” costs to trade. Many small companies I have worked with start by supplying to a large local exporter who can shoulder some of the cost and risk associated with trade.

— Stacey Gordon (@StaceyCGordon) October 18, 2018

2/2 A6. They then use that opportunity to springboard into the markets they are supplying into.

— Stacey Gordon (@StaceyCGordon) October 18, 2018

A6. Smaller businesses must focus on #cashflow and ensure that they can manage #financial commitments. Larger firms with more mature domestic operations can often avoid cash shortages more easily. #TradeElite https://t.co/RaaEYgEriO

— Jeffrey Shepherd (@JeffMShepherd) October 18, 2018

A6 – #TradeElite Personal opinion here – yes. Smaller firms need to be more aware of starting financial position, ensure they have the cash/access to financing & will feel the impacts of negative situations more on their bottom lines. Hence the need for better preparation. https://t.co/IBVIj9LmGz

— Scott C. Ferris (@ScottCFerrisPEI) October 18, 2018

A6 – #TradeElite On the upside for smaller firms, global trade can be a difference maker for them to launch exponential growth. There are risks, but there is so much support available for SMEs that can ensure they are prepared and supported in going global. https://t.co/IBVIj9LmGz

— Scott C. Ferris (@ScottCFerrisPEI) October 18, 2018

A6. ABSOLUTELY. Financial institutions are hesitant to invest in SME’s, they have to leverage their own money or be more creative abt investors. This means they have different burdens for repayment / access than larger companies. It’s getting better. #TradeElite

— audrey ross (@tresAudrey) October 18, 2018

What are some of the common financial mistakes small businesses make in embarking on global ventures?

A7. The less fixed you are on an expected outcome the less stressed you will be. Things change quickly when you go global. Agility & Flexibility are your new buzzwords. #TradeElite

— audrey ross (@tresAudrey) October 18, 2018

A7 – #TradeElite Not assessing their starting point and having a good snapshot of available resources. Failing to plan and engaging proper research to estimate costs. Either get your feet on the ground in target market or work through really good sources of intel.

— Scott C. Ferris (@ScottCFerrisPEI) October 18, 2018

A7 – #TradeElite Also many companies don’t take the time to learn about what supports are available to them. Reaching out for mentorship in this area can be a huge advantage, a real time saver, and point companies in the right direction for solid resources

— Scott C. Ferris (@ScottCFerrisPEI) October 18, 2018

A7:
1/3: Often companies get too caught up in the idea of making a lot of money and they miss taking key steps to mitigate their risks
Going into a market, “hoping on a plane” to “check things out” without a plan.

— Stacey Gordon (@StaceyCGordon) October 18, 2018

A7:2/3
Check out the @AB_EDT Trade Missions before going into a market, they provide a tremendous opportunity to travel with other AB companies and will use their resources to get you in front of the right people. #tradeelite

— Stacey Gordon (@StaceyCGordon) October 18, 2018

A7: 3/3 :Not properly planning the relationship/market development piece, either not understanding the upfront investment it will take to make a sale or not knowing when to move on to the next relationship. #TradeElite

— Stacey Gordon (@StaceyCGordon) October 18, 2018

A7. Businesses need to consider #export expansion as a long-term commitment. Don’t underestimate #exporting’s demand on #cashflow and ensure you have buy-in across the management team. #TradeElite https://t.co/dReLIEstdS

— Jeffrey Shepherd (@JeffMShepherd) October 18, 2018

A7. Also, a big mistake is not using #governmentfunding programs to #finance your international expansion. Small businesses can access government #grants to offset a range of market development activities. https://t.co/mcG6nQKqXd #TradeElite https://t.co/dReLIEstdS

— Jeffrey Shepherd (@JeffMShepherd) October 18, 2018

A7. Lack of an #exportplan is the worst mistake of all. The more effort your #smallbusiness puts into developing an export plan, especially in relation to finances, the fewer surprises you’ll have along the way. #TradeElite https://t.co/dReLIEstdS

— Jeffrey Shepherd (@JeffMShepherd) October 18, 2018

What are some hidden or often forgotten costs businesses need to account for in their planning?

A8: Given that many of the added costs come from the unknown, there are a few: taxes, delays due to processes (many industries are still gov’t owned in other countries), the difference in the amount of time it takes to build a relationship with your buyer, local content laws.

— Stacey Gordon (@StaceyCGordon) October 18, 2018

A8 – #TradeElite In my experience product/packaging modifications, including translation, are often overlooked. As are packing costs. But there are a ton of others – loading/off loading, tailgaiting, demurrage/storage, documentation fees, trade finance product fees… https://t.co/cut9fiSFy0

— Scott C. Ferris (@ScottCFerrisPEI) October 18, 2018

A8 – #TradeElite IP costs, licensing fees, agent/broker fees or commissions, legal fees, in-country fees (that could include facilitation payments – yes that’s still a thing) https://t.co/cut9fiSFy0

— Scott C. Ferris (@ScottCFerrisPEI) October 18, 2018

A8. In consumer goods? Courier costs. These are going to shoot up high as you are sending samples back & forth for approval, PR or QA review. Your local courier peep, may not be your int’l courier peep. COURIER COSTS. #TradeElite

— audrey ross (@tresAudrey) October 18, 2018

What are the most critical financial management issues for small biz getting into global trade?

A9. Getting paid and generating cash to cover export costs is essential. Using products like @ExportDevCanada credit insurance can help reduce #financialrisk and support long-term export success. #TradeElite https://t.co/errGSvLm51

— Jeffrey Shepherd (@JeffMShepherd) October 18, 2018

A9 – #TradeElite Agree Jeffrey, using @ExportDevCanada and your banks for risk mitigation and currency hedging tools is also important. https://t.co/2LVSEGjIUC

— Scott C. Ferris (@ScottCFerrisPEI) October 18, 2018

A9. #Cashflow planning should be the most prominent consideration your business makes. Take time to develop conservative and realistic forecasts. Being prepared for multiple scenarios will enable agility in foreign markets. #TradeElite https://t.co/errGSvLm51

— Jeffrey Shepherd (@JeffMShepherd) October 18, 2018

A9. Developing and communicating payment terms to your customers is of utmost importance. Don’t leave any room for misunderstandings, and proactively follow-up on invoices to speed the accounts receivables cycle. #TradeElite https://t.co/errGSvLm51

— Jeffrey Shepherd (@JeffMShepherd) October 18, 2018

A9 – #TradeElite It can be very sexy to be in new markets and companies can get caught up in wanting to be in certain markets (for travel, enjoyment purposes for example). It’s crucial to keep an eye on costs and your returns. Know when to take a loss and move on. https://t.co/H43VrqwHM3

— Scott C. Ferris (@ScottCFerrisPEI) October 18, 2018

A9:
The MCI is not having the #cashflow to make it through the export cycle and not considering all of the true cost when bidding. #TradeElite

There most likely will be delays and extra expenses that were not considered, so it is important to build in some contingency.

— Stacey Gordon (@StaceyCGordon) October 18, 2018

A9. Cash flow.
You pay your supplier.
You are paid on terms after delivery.
The farther out your market is, the more time before you can start the clock on payment. Ex, a project could ship in June, be delivered in July & be paid in Oct. #TradeElite

— audrey ross (@tresAudrey) October 18, 2018

What kind of finance skills are typically needed from in-house resources? Do you need to hire a financial expert?

A10: 1/3 #TradeElite No two trade deals or relationships are ever the same, so a general financial plan, understanding of what you want your capital structure to look like and how you are going to finance each stage of your export journey, is important.

— Stacey Gordon (@StaceyCGordon) October 18, 2018

A10: 2/3 #TradeElite Talking to another Canadian company who is experienced in your market is also very helpful. Hiring an experienced consultant is an option.

— Stacey Gordon (@StaceyCGordon) October 18, 2018

A10: 3/3 #TradeElite As the company starts to negotiate contracts and recognize revenue in foreign markets, I highly recommend enlisting the help of an accountant and trade lawyer in addition to a risk mitigation specialist.

— Stacey Gordon (@StaceyCGordon) October 18, 2018

A10. Your internal #finance expert must be able to understand and mitigate economic risks, process and report international payments, and proactively manage cashflow. #TradeElite https://t.co/U7d2aKFepS

— Jeffrey Shepherd (@JeffMShepherd) October 18, 2018

It’s worth it. They seem expensive, but not as expensive when you have to pay out for some silly mistake they could have saved you from. Remember – long term investment. #TradeElite https://t.co/XRCcV30QiA

— audrey ross (@tresAudrey) October 18, 2018

A10. If building in-house skills is preferred, EDC-FITT #internationaltrade training courses can provide members of your team with the skills necessary for #export success. https://t.co/fF2s2KAUZW #TradeElite https://t.co/U7d2aKFepS

— Jeffrey Shepherd (@JeffMShepherd) October 18, 2018

A10. You need someone who really understands your biz & is great at the domestic market, then they need to know / work w// hire someone / a firm who really knows the target market & global business. More training or 3rd party are going to be needed. #TradeElite

— audrey ross (@tresAudrey) October 18, 2018

A10 1/2 #TradeElite Ability to read financial statements at a basic level, understand cash flow, building costing and pricing estimates are certainly strengths. At some time, yes you will need an expert – accountant, banker, trade finance specialist https://t.co/2QBI1EQSBU

— Scott C. Ferris (@ScottCFerrisPEI) October 18, 2018

A10 2/2 #TradeElite SMEs need to focus on their core competencies and be generalists in other areas where experts can step in, saddle up and take on specific areas and bring expertise that’s needed. https://t.co/2QBI1EQSBU

— Scott C. Ferris (@ScottCFerrisPEI) October 18, 2018

Recent evidence suggests that financial support to small biz is most successful when offered in combination with consulting services, business advice or financial education – what are your thoughts?

Q11 #TradeElite I’d agree with this as someone who benefitted from financial support & paid project management help and now as someone who provides that support. Throwing money at a company without the knowledge or skills to properly ensure it used is a waste. https://t.co/JODmij6VaD

— Scott C. Ferris (@ScottCFerrisPEI) October 18, 2018

A11. Absolutely agree. There is no way you / your team can think of every thing. Use your resources & set up a great foundation with experts, then as you learn more you can work independently. #TradeElite

— audrey ross (@tresAudrey) October 18, 2018

Read the rest of the chat and join future discussions by following the #TradeElite hashtag. And stay tuned for the next #TradeElite chat, coming up on November 15th at 2:30-3:30PM ET, and if you haven’t yet, join us on Twitter at @FITTNews.

The post How SME’s can get financially prepared to access new global markets appeared first on Trade Ready.