It is a common business phenomenon and in many cases the moment you have been working towards ever since you started.
You have invested all of your time and effort into developing your product, marketing and getting yourself in front of the right people and yes! It has paid off! You have landed the first big order!
Not only that, but if you get this right the order will be rolled out throughout the group/industry/world.
You knew the customer would want payment terms and have already spoken to some factoring companies.
And now comes the tricky bit: You have to buy stocks, or components. You have to run around a lot before fulfilling the order. You have to fly to China – this all costs money – money you have already spend developing your fledgling business to this stage.
Go to your bank – it is typically the first port of call – who knows, they might help you.
Or they might want your house as security.
Or they might just look blank.
If they don’t want to help, we can talk about trade finance / supply chain finance / purchase finance – a specialist facility designed for small businesses who win big orders
No need to let your customer down
No need to put your house on the line
Trade finance can take several different forms and cover a wide range of deal sizes
It is about enablement, not borrowing.
Like any finance product, it isn’t a universal panacea, but it can be invaluable in the next stage of growth.