Article Source: The Manufacturer
It takes more than one company to make an export happen: if you’re not exporting, but sell to a company that is, you’re helping make UK exports happen – and HM Government can offer you finance to support your cash flow.
This is an exciting time for UK industry – for the first time in 40 years, we’re beginning to shape our own trade agenda. It is especially important for UK manufacturing because it’s a sector at the very heart of our economy for which there is booming global demand.
And it is this overseas demand, according to EEF, that is driving factory output to grow at a faster rate than the rest of the UK economy.
Support for UK suppliers
HM Government, through its export credit agency UK Export Finance (UKEF), is constantly looking to provide the best possible support to help UK suppliers make the most of export opportunities.
One way UKEF is doing that is by extending its offer of short-term finance support to the UK supply chain for the first time.
If you’re selling products to another UK company that will contribute to something that the company will then sell overseas, you could be eligible for UKEF support. From bonds to working capital loans, UKEF can help you fulfil your contracts.
And for SMEs, the good news doesn’t stop there. Access to government-backed finance is faster and easier than ever before too. You can now access loan or bond support worth up to £2m directly from the five major high-street banks, without the need to apply to UKEF separately.
For eligible transactions, UKEF could be providing cover within seconds.
Improved access to capital
If you need extra cash to help you deliver an order, UKEF can give your bank a guarantee for up to 80% of the value of a working capital loan. That means you could secure a larger loan than you might otherwise have done, helping you manage your cash flow, or take on bigger orders.
Similarly, if you need to provide a bond from your bank in order to secure the order, such as a performance or advance payment guarantee, UKEF can give your bank a guarantee for up to 80% of the bond’s value.
This significantly reduces the security you need to give the bank in return for the bond, helping you hold onto the cash you need to deliver the contract.
Wakefield-based Green’s Power was the first company to benefit from the government’s new supply chain finance offer.
Matthew Crewe, managing director of Green’s, commented: “Having worked with UKEF on several export contracts, UKEF has played a significant role in our international growth. This new avenue for support means we have greater capacity to grow our business in the UK too.”
This is a great example of how UK companies will benefit from UKEF’s new supply-chain trade finance.
By extending support beyond the exporter, into the supply chain, UKEF is not only helping individual UK manufacturers grow their business, but also making UK exports more competitive on a global scale by making it easier for exporters to deliver.
So, the next time you bid for a supply contract you know is contributing to an export, consider whether government-backed finance from UKEF could give you the edge you need to win.
And of course, if you’re thinking about bidding for international business, UKEF will be there to help too.