By David Josephson at Export-Import Bank of the U.S.
Why should a small bank with a focus on its local customers and deposits care about including export finance in their offerings to customers? The answer is quite simple: more and more, their customers who are manufacturers or service providers are going global in order to boost their sales, and the more that a local bank knows about export finance, the more valuable that bank is to its customers.
The Export-Import Bank of the U.S. (Ex-Im), America’s official export credit agency, exists to support U.S. job growth by equipping businesses with export financing tools in instances when private banks are unable or unwilling to offer support. More than 98 percent of Ex-Im’s transactions last year involved partnering with a private financial institution to support export sales; all told, Ex-Im supported 164,000 American jobs by supplying products like insurance, working capital, and loan guarantees to its customers—90 percent of which were U.S.… Read the rest
By Aaron Lindstrom, Euler Hermes
Few companies can effectively compete without extending credit to their buyers. But each time a business grants credit to a customer, it is taking a chance that the debt will not be paid. This creates risks for the business’s cash flow and profitability, since one large unpaid invoice may have the potential to impact the bottom line, halt growth, or even trigger insolvency. Representing up to 40 percent of a typical company’s balance sheet, accounts receivable (A/R) are naturally both a vital and vulnerable component of a healthy business.
In the face of today’s changing economic climate, recognizing and managing future A/R risks needs to be a priority for many businesses.… Read the rest
By Shannon Abnal, Group Services Manager – Data Contribution & Industry Groups
Obtaining credit information upfront on customer applications is an integral part of credit management. Performing some due diligence in deciding a customer’s creditworthiness is part of every firm’s credit policy. There are varied methods of getting the info – pulling credit reports, checking references, internet research – but nobody doubts that knowing the facts about your potential customer before extending credit makes sense. You investigate, compile, consider, and determine before you extend credit.
The same holds true for what to do when debt goes bad. Most firms have a set of rules that guide the credit manager when customers pay slow or stop paying.… Read the rest
By: Tawnya Marsh, CCE, Columbia River Knife & Tool
What is GSCFM? I’m sure most of you reading this article already know what GSCFM stands for but just in case, the acronym is defined as the Graduate School of Credit and Financial Management. For me, GSCFM represents a plethora of education and opportunity.
I just completed my first year on the beautiful Dartmouth Campus. The education that NACM provides for this program is unsurpassed. While you only spend two weeks in class I felt like I spent an entire semester at Dartmouth with all of the information we received. The instructors that NACM pulls for this program are amazing. Topics from Cash Flow Analysis to Corporate Strategy, Public Speaking, and finally flowing into a program on Body Language, you really do touch all aspects of being a successful credit manager and leader.… Read the rest
With the amount of fraud and terrorist group activity, U.S. government regulators as well as those from other established economies are watching more closely than ever for illegal activity. Businesses involved in global trade can easily get wrapped up in such activity, and it’s often by accident or for not taking that extra step of due diligence when a red flag arises. Most familiar with government agencies and regulators strongly believe that perfection is not the expectation, but honest and intentional effort and due diligence is. Perhaps the most profitable action is avoiding the mistake andthe regulatory ire that comes with the wrong business dealings. In short, know what not to do. The following are some mistakes to avoid:
Failure to Know Popular Transshipping Countries
Businesses or individuals in virtually any country can do transshipping, or reshipping, by posing as an end user who will then flip the goods, especially those with security sensitivity or with a military use, to buyers in nations where such exporting activities are banned.… Read the rest
A well-thought-out credit policy focuses a company’s risk-based decision making and is a highly-regarded guide for conducting B2B credit-related business by all departments—even sales. In order to establish an effective credit policy, a credit department must first have an effective mission statement. Without this strong, secure base, anything built upon it is prone to instability or collapse. As such, the following are important considerations when crafting your credit department’s mission statement.
Risk Tolerance: A company needs to take an honest look at where it realistically wants to be positioned in the marketplace. In doing so, it also has to consider out how much risk will be tolerated to get there and whether top officials and company financiers are willing to go to such a level to make that happen.… Read the rest