Navigating Uncharted Waters - New Clients & Export/Import

If you sell a product, any product, and your business continuesIt to grow, at some moment you will find yourself in unchartered waters. This is when you draw upon your Circle of Trust Advisors and seek out assistance on Trade Services.

Trade Services is the term used by most commercial banks to describe bank instruments or products that assist business owners in moving products to places and/or with people previously unknown to them. It covers a wide area of trade, both domestically and internationally.

Many business owners will come across a ‘Letter of Credit’ in their business lifecycle. This is an instrument that many landlords require from a new renter or with a long term lease. A Google Search provides this simple definition: a letter issued by a bank to another bank to serve as a guarantee for payments made to a specified person under specified conditions.’ This requires a bank underwriting analysis and often cash collateral. You typcially may see this internationally when say a US company is renting space across the border in Canada. There are many types of Letters of Credit so be sure to sit with your Banker and perhaps their Trade Rep to understand how one may benefit your organization.

Often when conducting trade outside of the country, there are many protective benefits to using Letters of Credit, Bankers Acceptances, or any other more exotic and customized tools. The ultimate goal of all of these is to ensure you are paid and in a timely basis. Large new orders, international orders, importing raw materials are but a few of the instances when you will see these products offered to you. Do not panic when you see these terms and they are unfamiliar. Your Commercial Banker should be there to guide you through these uncharted waters.

Business growth can be both exciting and a bit unnerving. Make sure you have a Commercial Banker as a Trusted Advisor and take your time in assessing the use of any of these Trade Services Products. They come with great financial protection but they are not cheap.

Steady as she goes is a nautical saying often used and certainly applies when venturing into the sea of uncharted Trade Services. But with proper training, guidance, and a good Commercial Banking Coach, you will find yourself like our Blog Photo Dog, commanding your journey

Be well.