Trade Finance
Fund the gap between paying your suppliers and being paid by your customers, so you can buy, manufacture and trade across borders with confidence.
Funding the gap before you get paid
Trade finance funds the part of a deal that comes before the money does. You have an order to fulfil, or goods to buy, but you have to pay your supplier long before your customer pays you. Trade finance covers that gap, and it manages the risk that sits on both sides of a cross-border transaction.
In its simplest form, a lender pays your supplier, often up to the full cost of the goods, and you repay once the goods are sold and your customer has paid. Because the funding is tied to the transaction, approval often rests on the strength of the order and the creditworthiness of your customer and supplier, not on your balance sheet alone. That is what lets a growing business take on an order larger than its own cash could support.
It frequently sits alongside invoice finance, with trade finance paying the supplier at the start and invoice finance releasing the cash once you have delivered and invoiced. Together they fund the whole cycle, from order to payment.
The main instruments
Which of these you need, and in what combination, depends on the trade.
Letter of credit
Purchase order finance
Import or trade loan
A bank-backed guarantee that your supplier will be paid once they present the right shipping documents. It reassures an overseas supplier and protects you, because payment is only made when the agreed terms are met.
Import or trade loan
Purchase order finance
Import or trade loan
Working capital to cover the period between paying your supplier and being paid by your customer.
Purchase order finance
Purchase order finance
Purchase order finance
Funding to fulfil a confirmed customer order, where the lender pays your supplier directly, so you can deliver an order bigger than your cash would allow.
Bonds and guarantees
Trade credit insurance
Purchase order finance
Instruments such as performance bonds and advance payment guarantees that give a counterparty the confidence that you will deliver.
Trade credit insurance
Trade credit insurance
Trade credit insurance
Cover that protects you if a customer fails to pay.
When trade finance helps
Trade finance suits businesses whose growth is limited by the gap between paying for goods and getting paid for them.
- Importers buying from overseas suppliers who want payment upfront or on shipment
- Exporters selling to buyers abroad who need certainty of payment
- Manufacturers with international supply chains, buying materials or components ahead of production
- Distributors and product businesses winning orders larger than their working capital can fund
The common thread is an opportunity you could take, if only the funding gap were bridged.
A fragmented market, and who knows it
Trade finance is served by a mix of clearing banks, specialist trade finance houses, export agencies and newer lenders, and they differ widely in what they will fund, how fast they move, and what they charge. The specialists will often move quicker and take on deals the high street will not.
We are whole-of-market, and after more than twenty years we know which of them fits which trade. Every fee and commission is disclosed before you commit, and every deal is led by a principal. You reach the right funder without working your way through the wrong ones first.
In Practice
Altura Advertising
Technology · £225,000 · Trade Finance
This advertising technology business came to us looking for funding to scale. It had already tried elsewhere without success. We secured a £225,000 revolving credit facility so the business can pay suppliers and other trading costs as orders come in. As the facility is repaid, the funds become available to use again, which gives the business a flexible pot of working capital that grows with it.
"You were able to help me secure finance for my business where others had failed."
Adrian Clayton, CEO
Talk to us about the trade
Whether you are importing, exporting, or manufacturing across borders, tell us about the trade you want to do and where the funding gap is. We will find the right way to bridge it, and the right funder to do it.
Copyright - Goodman Corporate Consultancy Ltd
Goodman Corporate Finance is a trading style of Goodman Corporate Consultancy Ltd. Company no 5364029 Registered in England and Wales.
Registered office: 5 Prospect Place, Millennium Way, Pride Park, Derby, DE24 8HG.
Goodman Corporate Consultancy Limited is an FCA authorised Credit Broker and not a lender.
We typically receive a payment (s) or other benefits from the finance provider if you decide to enter into an agreement with them depending on the chosen provider and their commission or incentive models. Different lenders pay different amounts depending on different commission models. Further details of the commission model, calculation and amount will be disclosed to you throughout your customer journey.
Goodman Corporate Consultancy Ltd is Authorised and Regulated by the Financial Conduct Authority under number 733340.
Goodman Corporate Finance is registered with the ICO no. Z1828753.
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