Hi, I just started an exporting business in Homestead, Florida USA. I
followed the advise of the SBA counselor and registered a business in
Nicaragua ( Nejapa Importadora & Exportadora S.A. ) and have a registered
corporation in Florida ( Ennax Trading Corporation ). I made contact with
different distributors over there that are interested in importing tools and
safety equipment from USA.
But they want us to have merchandise available over there, meaning that we
have to make an initial investment just to show them what we could import,
the question is; if they proceed with an order, how can we assure that we are
getting paid and if the order is too big, how can we finance the export?
This is going to be tricky. My first impression given that your business is
so young is that your best bet for financing is to get one of those small
business lines of credit from a community bank. This is assuming that you
still have a regular job and that your credit history is good.
Believe it or not, there are quite a few products out there where you do not
even have to submit financials for the business. The downside is that the
amounts are small and limited by your global cash flow, which includes your
personal income.
The other issue that you bring in about how to insure payment from the
customers in Nicaragua.... Well that is going to be up to you. It will come
down to your ability to assess the customers. This is vital for the business
survival because the lender will expect to get paid even if your customers do
not pay you.
If your products are US made, the ability to get insurance on your exports
through the Eximbank is something that might be worth looking into. Insurance
will eat a couple of percentage points from your margin, but it might save
your business from going under if the customers don't pay their invoices. By
the way, most export operations in South Florida get financing with Eximbank
insured facilites, and not with SBA. It is a much better product for
exporters as long as the product is US manufactured or produced. Check it out
at exim.gov
BizResearcher | Window Shopper |
8/22/2012 - 11:16 am
You may want to contact a bank that deals in international money
transactions. They can set up an account for you and they will know what is
needed to guarantee payment.
You may also want to contact your state agency that handles international
trade, often a division of your state department of commerce. They handle
issues like this all the time. They can help with the export documentation
and other issues.
loanuniverse | Window Shopper | 8/23/2012 - 7:47 pm
so young is that your best bet for financing is to get one of those small
business lines of credit from a community bank. This is assuming that you
still have a regular job and that your credit history is good.
Believe it or not, there are quite a few products out there where you do not
even have to submit financials for the business. The downside is that the
amounts are small and limited by your global cash flow, which includes your
personal income.
The other issue that you bring in about how to insure payment from the
customers in Nicaragua.... Well that is going to be up to you. It will come
down to your ability to assess the customers. This is vital for the business
survival because the lender will expect to get paid even if your customers do
not pay you.
If your products are US made, the ability to get insurance on your exports
through the Eximbank is something that might be worth looking into. Insurance
will eat a couple of percentage points from your margin, but it might save
your business from going under if the customers don't pay their invoices. By
the way, most export operations in South Florida get financing with Eximbank
insured facilites, and not with SBA. It is a much better product for
exporters as long as the product is US manufactured or produced. Check it out
at exim.gov
BizResearcher | Window Shopper | 8/22/2012 - 11:16 am
transactions. They can set up an account for you and they will know what is
needed to guarantee payment.
You may also want to contact your state agency that handles international
trade, often a division of your state department of commerce. They handle
issues like this all the time. They can help with the export documentation
and other issues.
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