Businesses all over the world have to learn how they can live with increasingly volatile business conditions. With political upheaval, growing interest rates and inflation levels, disrupted supply chains and high shipping costs, it’s not likely that these issues are going to be going anywhere anytime soon.
Alongside this, businesses are also looking at their domestic markets and the disappointing opportunities they often present. As a result, many are looking into international growth strategies which may provide more lucrative opportunities, particularly in countries where economic growth is increasing. We’re in perhaps the most turbulent business environments that we’ve ever experienced, so it makes sense for businesses to look at other potentials which may bring them increased revenue in the long-run.
Protecting Your Business Against Export Risk
Export risk relates to uncertain events which may have negative impacts on how you achieve your business goals. Exports are goods or services which a business will supply to customers internationally, so export risks relate to events with which a certain degree of probability applies that will affect the success of foreign and international business.
With export products, whilst the value of the product or service can be high, the transactional values, which also bring with them risks, can be higher. This is why export credit insurance can be a great decision for businesses that deal with international exports, as it provides an extra layer of protection against the unexpected and unknown. For help with finding the right export insurance, it would be worth speaking with a credit insurance broker, who can find the right insurance for you.
Removing The Stress From Export Strategies
Confidence is perhaps the most important enabler when it comes to planning and discussing export strategies. Businesses tend to hold back when giving credit that international customers are seeking due to concerns associated with risks, so this is where credit insurance can deliver the necessary insight which can increase certainty with credit-related decision making.
There has been a perception that trade credit insurance is more suited towards multinational corporations, however, this has now changed. There is certainly an export opportunity for SMEs and, because they often don’t have the expertise, global reach or industry knowledge to get financial insight into export buyers, trade credit insurance, trade credit insurance could be a good, secure option.
Stronger Credit Processes
Banks, typically speaking, give more capital to businesses that have insured assets. They may also be more willing to lend to you at better rates when you have some protection from risks. This means businesses will then have better access to capital, which then helps to grow the business. Trade credit insurance also adds a level of discipline to credit management. It helps to enforce core processes, right from the initial set-up for new accounts to buyer credential verification. By taking out insurance, you’re also protecting yourself if an insurance claim is to be made, so that it can be handled in an effective, efficient and professional manner.
