The company offers a wide range of products in the global market, with its annual exports reaching USD 3 million. However, when more and more buyers requested longer payment terms, the trader found it was a challenge to generate capital quickly on its own as accounts receivables began to pile up. Caught in a financial conundrum, the company had trouble expanding its business to meet the requirements of more qualified buyers across the world.

To improve its working capital for taking on larger orders, the client approached Tradewind from a friend’s introduction. Tradewind’s timely tailor-made trade finance solution ensured the trader had stable access to scalable funding for further expansion. The credit protection provided by Tradewind, ensuring that the client would get paid in the case of buyer insolvency, also eased the client’s concerns about international trade. Furthermore, with the facility in place, the company was able to support open account terms of 60 to 90 days for overseas buyers.

“Tradewind’s flexible funding solution and strong global network are what caught our client’s attention. With Tradewind’s help, our client was able to accept more open account orders and improve their competitiveness in the industry. It’s a great pleasure to contribute to their growth,” said Dickson Au, Regional Commercial Director – Far East, at Tradewind Hong Kong.

About Tradewind Finance

Founded in 2000, Tradewind Finance maintains a network of offices all over the world, including Bangladesh, Brazil, Bulgaria, China, Hong Kong SAR, Hungary, India, Pakistan, Peru, Turkey, UAE, and the USA as well as the headquarters in Germany. Combining financing, credit protection, and collections into a single suite of trade finance products, Tradewind brings streamlined, flexible, and best-in-class services to the world’s exporters and importers.

The post Tradewind Finance Provides Export Factoring Facility for Automobile Parts Trader in China appeared first on Tradewind Finance.

President Xi Jinping delivered a keynote speech at the opening ceremony via video link, highlighting the importance of China’s accessibility to global players as a key manufacturing and distribution hub as the rest of the world continues to navigate ongoing supply-chain challenges.

China, being the second-largest economy in the world, has been and continues to remain a key market for the Tradewind Group. Chinese exporters however are not impervious to cash-flow constraints and buyer non-performance. Since entering the Chinese market in 2013, Tradewind has provided customized financing solutions to a variety of SMEs and mid-market clientele operating across the automotive, electronics, seafood, chemical & consumer goods, and food & beverage sectors.

Tradewind’s customized export factoring supports companies by improving their cash flow position, streamline collections, and control exposure to bad debts, enabling them to generate more sales by offering longer payment terms without disrupting cash flow or taking on undue risk.

About Tradewind Finance

Founded in 2000, Tradewind Finance maintains a network of offices all over the world, including Bangladesh, Brazil, Bulgaria, China, Hong Kong SAR, Hungary, Iceland, India, Pakistan, Peru, Turkey, UAE, and the USA as well as the headquarters in Germany. Combining financing, credit protection, and collections into a single suite of trade finance products, Tradewind brings streamlined, flexible, and best-in-class services to the world’s exporters and importers.

The post Tradewind Exhibits at the 4th China International Import Expo appeared first on Tradewind Finance.

What is Reverse Factoring?

While factoring finance, or trade factoring, is generally pursued by the selling side, reverse factoring is a buyer-led financing solution that creates faster funding for suppliers. Using a third-party financial institution or platform, companies can offer early payments to suppliers based on approved invoices.

Buyers initiate reverse factoring programs on behalf of suppliers, and both parties benefit from a financing arrangement that can be accessed more quickly than traditional bank loans. The advantage of a predictable payment schedule helps every link in the supply chain, enabling the synchronization of manufacturing and distribution production schedules.

How the Reverse Factoring Process Works

An ordering party, or buyer, decides to enter a reverse factoring arrangement to optimize cash flow within the supply chain. Reverse factoring follows a six-step process:

1. Buyer Introduces a Financial Intermediary

The buyer reaches out to a third-party financial institution to arrange a reverse factoring program. Instead of basing rates on the supplier’s credit, reverse factoring is based on the buyer’s credit. In most cases, these differences can lower financing costs significantly.

2. Buyer Onboards Suppliers

Onboarding suppliers is typically a quick and straightforward process. Vendors receive their payments earlier, making reverse factoring a preferred financing method. Manufacturers and suppliers in various industries, such as electronics, automotive, clothing, and aerospace, can alleviate immediate working capital needs.

3. Suppliers Request Payment

The supplier sends the next invoice – or Account Receivable – to the financial intermediary, requesting early payment minus the processing fee. No interest is added to the cash advance, which means buyers and suppliers avoid debt on their balance sheets.

4. Buyer Approves Invoices

When the supplier requests a payment, the buyer is notified for approval. The financing institution then issues payment to the suppliers on behalf of the buyer.

5. Supplier Receives Payment Early

Once approved, the cash advance provides the supplier with the working capital necessary to begin processing the subsequent order. Suppliers can receive their funds in 48 hours, compared to the typical 30 to 90 day waiting period of most banks.

6. Buyers Make Payments by the Maturity Date

The buyer pays back the third-party financing company in full within the agreed-upon time frame or maturity date. Production can continue uninterrupted when working capital is available, benefitting all parties involved.

How Supply Chains Benefit From Reverse Factoring

Immediate cashflow challenges that impact one link in the supply chain can have a rippling effect on other members of the manufacturing and distribution process. Reverse factoring ensures workflows stay on track and uninterrupted for everyone in the supply chain. Suppliers benefit in the following ways:

• Receive invoice payments faster
• Reverse factoring doesn’t add debt
• Reduce disruptions in the supply chain
• Can negotiate more favorable payment terms
• Improve working capital position
• Minimize administrative payment processing tasks
• Protected in the event of non-payment
• Fewer invoice disputes

Reverse factoring has significant potential to finance a greater degree of international trade transactions. This potential leaves ample room for distributors to improve their standing with existing and future suppliers.

The accessibility of reverse factoring programs also offers an attractive means to avoid insolvency issues since all parties know when payments will be received and processed. Additionally, large and multinational corporations can safely build working relationships with smaller suppliers using supply chain financing.

Final Thoughts

An international trade finance company can help your entire supply chain operate more smoothly by providing dependable, consistent financing that enables predictable production schedules. For buyers and suppliers in nearly all sectors, reverse factoring can serve as an ideal financing tool.

Despite the numerous advantages of reverse factoring, many supply chain operations still overlook this option. Buyers are often unaware of the enhanced negotiating positions they can achieve by proposing reverse factoring arrangements to their suppliers. Whether a buyer has a handful of suppliers or a network of thousands, reverse factoring can provide the financing necessary to achieve optimal business outcomes.

The post How Reverse Factoring Can Provide Suppliers With the Financial Support They Need appeared first on Tradewind Finance.

With US buyers embracing open account payment terms, which give them longer windows to pay their invoices, the client faced increased financial pressure and risk, so it turned to Tradewind for help to overcome these challenges.

Tradewind arranged a financing solution that expedited cash flow to the client, replenishing its working capital reserves, and at the same time provided credit protection that covered the risk of nonpayment due to buyer insolvency. It was Tradewind’s flexibility that really shone through in the partnership, though.

To avoid the blow of tariffs affecting the tire industry, the Chinese company moved its operations to its Southeast Asia branch. Based on the relocation, Tradewind adjusted their services in line with the move, financing invoices on exports from Southeast Asia, instead, and wiring funds to the company’s account in the US.

“Tradewind has extensive experience in the automotive and auto parts industry, which we used to customize an optimal financing solution for our client with a quick funding turnaround. We are especially happy to have leveraged our global presence and international capabilities and provide flexibility and security during a time of volatile trade conditions,” states Ms. Li Fang, Sales Manager of Tradewind Shanghai.

Tradewind maintains a network of offices all over the world, including Bangladesh, Bulgaria, China, Hong Kong, Hungary, India, Pakistan, Peru, Turkey, UAE, and USA as well as the headquarters in Germany. Combining financing, credit protection, and collections into a single suite of trade finance products, Tradewind brings streamlined, flexible and best-in-class services to the world’s exporters and importers.

The post Tradewind Funds Tire Supplier based in China appeared first on Tradewind Finance.

Auto care products are always in demand in the UAE due to the fact that car leasing within the country is easy and affordable. The company, however, had difficulty obtaining funds to meet this demand, as well as to finance their exports to other markets, because of a local credit squeeze.

Leveraging its Dubai office location, Tradewind stepped in as a capable financial partner and provided quick funding to the auto solutions supplier to help support their immediate working capital requirements. The facility enables the company to transact on payment terms of 60-90 days with their customers.

As a result of Tradewind’s services, the UAE business was able to procure additional parts, paints, and supplies from Germany and other European countries, as well as take on more orders and foray into new markets with the benefit of credit protection, which comes as part of the firm’s trade finance package.

“By working closely with the client and understanding their major pain points, we were able to structure a customized financing arrangement that solved our client’s unique cash flow issues so they could continue to serve the high-demand auto market in the UAE and elsewhere. Additionally, we used our network in Dubai to connect with GCC-based buyers, who found our services to be mutually beneficial for them,” states Maham Siddique, Business Development Manager of Tradewind Dubai.

Tradewind offered transparency and approachability in the dialogue surrounding the deal, which allowed them to arrive at a financing solution that was the right fit for the client.

Tradewind provides innovative international cash flow solutions tailored for global clients. Focused on the mid-market, its core products are non-recourse factoring and supply chain finance. The group has built an unrivaled reputation for the depth of its international finance expertise by maintaining a network of offices around the world including the USA, China, India, Hong Kong, UAE, Turkey, Bangladesh, Pakistan, Bulgaria, Hungary, Peru and its headquarters in Germany. Combining financing, credit protection, and collections into a single trade finance facility, Tradewind offers streamlined, flexible and best-in-class services.

The post Tradewind Provides $1.1 Million Credit Facility to Automotive Aftercare Company based in the UAE appeared first on Tradewind Finance.

Last year, the United States imposed tariffs on many Chinese goods, creating an increase in cost for many companies. Even global supply chain companies who have not yet felt the impact of the Chinese tariffs may seek alternate suppliers and other ways to absorb potential cost increases.

Companies that don’t use Chinese goods directly are not immune to the effects of tariffs. Such companies may see increasing prices on raw supply materials and higher costs for products that may contain parts from China.

How Supply Chain Companies are Dealing with Tariffs

Proactive businesses aim for resiliency in their supply chains – with or without imposed tariffs. Global companies know business comes with the risk of disruption and mitigating risk is part of healthy operation. Some of the most common strategies include:

• Lobbying for an exemption
• Increasing the prices of products
• Moving production locales
• Sourcing new suppliers of raw materials
• Offsetting increase costs in manufacturing by reducing costs in other parts of the operation

As Chinese tariffs stand today, the United States has imposed tariffs on $250 billion worth of China’s products. Steps to increase cost efficiency in operations are at the forefront of the import and export markets.

Automotive Tariffs

Automotive dealers are also closely watching the tariff news. If the United States imposes a 25 percent tariff on imported vehicles and vehicle parts, supply chain businesses anywhere on the automotive line will feel the repercussions.

A survey of automotive dealers found industry leaders are pessimistic about the future. Only 11 percent of dealers surveyed indicated the tariffs would make the automobile industry stronger. According to industry officials, the tariffs could raise the price of new vehicles by nearly $3,000. Imported vehicle prices could jump even higher – by $3,700.

Automobile dealers – already dealing with all-time high new vehicle prices – believe the tariffs will put new vehicles out of reach for the average buyer. Dealers expect customers to shift their focus from purchasing new cars to used or pre-owned vehicles should these tariffs go into effect.

Export Factoring and Financial Solutions for Absorbing Tariffs

As tariffs take root and the possibility of more tariffs remains on the table, forward-thinking companies look to supply chain finance companies to stay competitive and improve cash flow.

While many business owners may look to traditional lending options to weather a tariff storm, bank loans often present problems for businesses. The underwriting can be extensive and time-consuming. Also, many businesses may not have the collateral on hand to support a bank loan since cash flow is often wrapped up in supplies or inventory. In addition, commercial lending requirements continue to tighten, making business loans out of reach for many global manufacturers.

Some of the best factoring companies provide financing methods that can help companies deal with the fallout of tariffs. Vendor financing, for example, provides additional capital when needed. These companies help broker a loan in which manufacturers borrow from vendors to purchase needed supplies.

For example, suppose a company is using a new supplier to avoid increased costs due to tariffs. As a manufacturer, the orders are locked in, but capital is short to purchase materials from your new vendor. A supply chain finance company brokers a vendor financing arrangement and the manufacturer repays the vendor.

Final Thoughts

The best export factoring companies offer solutions for global companies that are cash-strapped from tariffs. In short, export factoring allows a factor to buy a company’s accounts receivable in exchange for a percentage of the collectible amount. The company then has cash in hand and no longer deals with account receivable operations.

A supply chain finance company such as Tradewind purchases a company’s accounts receivables for up to 95 percent of the value. Tradewind, considered a leading international trade finance company, then takes over the collection on the accounts. When payment is received, the finance firm forwards the agreed upon balance to the company, completing the business cycle.

The post How Supply Chain Finance Helps Businesses Amidst Tariffs appeared first on Tradewind Finance.

Auto part manufacturers, distributors, and retailers create some of the most complex supply chains in the world. Businesses focused on the international trade of automobile products are excellent candidates for trade finance. Knowing when to engage a trade finance company could mean the difference between considerable market share growth and just surviving.

What Is Trade Finance?

Before we explore when it makes sense to contact a trade finance company, it is important to understand the basics. In general, an exporter will require payment of goods from an importer before they are shipped, if not sooner. However, many importers will have their capital locked up in inventory waiting for a sale.

On the other hand, even if the importer were able to fund the purchase of product, they would want reassurance purchased goods are shipped as agreed upon and arrive on time. Trade finance companies can step in and fill the needs of both parties by:

• Providing the funds to purchase goods from the exporter
• Monitoring the movement of goods from dock to door
• Controlling the terms of payment by the importer

The transaction is completed without requiring the importer to use its owned capital assets as collateral. Instead, the trade finance company vets both the importer and exporter thoroughly. If both entities check out favorably, the trade finance company controls the transaction in its entirety. The result is a win for every party involved.

Obtain More Favorable Repayment Terms

You have developed strong relationships with distributors and manufacturers around the globe. However, in today’s fast-paced trade economy, your partners may choose importers who can accept the shortest payment terms. If your organization requires lengthy payment options, exporters may seek other trading partners, leaving your organization standing empty-handed.

When an opportunity to enter a new market or grow market share rises, do not let payment terms submarine your company’s ability to meet the demand. Trade finance companies put up the capital necessary to meet even the most demanding terms of export companies. Partnering with a trade finance company gives you the buying power necessary to seize opportunities while the trade finance company offers you favorable repayment terms.

And the opposite holds true too. If you as the buyer are seeking longer payment terms with your suppliers, trade finance companies offer solutions to accommodate this arrangement as well.

Secure Customer Payments Faster

Providing favorable payment terms to customers is a competitive advantage. As a supplier, you may be offering 60, 90, or even 180-day terms to your customers. While longer payment terms can definitely secure long-term relationships, the generosity locks up valuable capital in inventory you no longer control.

When faced with requests for lengthy payment terms from customers or as dictated by a competitive landscape, trade finance can release working capital tied up in the transaction. Trade finance companies take over and manage the payment from customers while providing your company cash immediately. Faster access to your capital significantly reduces the time normally required to enter into your next selling agreement and increases the ability to grow.

Reduce Risk

Risk is part of nearly every international trade transaction. Your organization will face risks that normally are not encountered domestically. When handling all aspects of an international transaction, it’s important to be aware of the risks involved including:

• Credit risk
• Political instability
• Foreign currency fluctuations
• Cargo and transportation risks
• Import and customs regulations

Although technology has helped businesses reduce trade risk, managing and reducing exposures can be a daunting task. Even with the best risk management practices employed, exposure still exists that will always remain outside the scope of a business’ control.

If your organization is looking for a centralized solution to reducing and nearly eliminating trade risk, you should consider enlisting the services of a trade finance company. Not only do trade finance companies secure payments between importers and exporters, but they also protect from events and circumstances that would otherwise disrupt a successful transaction.

Financing Your Automotive Supply Business

Whether you are the buyer or seller, securing the flow of cash for overseas transactions is critical to your automotive supply business’ long-term success. Choosing a cash flow solution such as trade financing to address your company’s capital needs will leverage the benefits of liquidity with the security of risk transfer. Explore how trade finance can help your business by contacting the experts at Tradewind Finance.

The post When Should I Contact a Trade Finance Company to Expand My Automotive Supply Business? appeared first on Tradewind Finance.

Due to consistent innovations and a solid reputation in the industry, the company had been receiving an influx of larger orders with longer payment terms when it first considered Tradewind for financing. With 15 plants in operation, it still had to outsource some basic parts in order to keep up with the delivery schedule. Consequently, the down payment on these outsourced parts, as well as on raw materials, consumed a great deal of the company’s cash flow. While its bank line and other investments eased the pressure on its liquidity at first, the company soon encountered a cash flow crisis after it expanded its operations and saw its orders triple. After recognizing the limits of traditional lending, the auto parts manufacturer decided to look for other solutions.

The company chose Tradewind as its preferred financial partner because of the firm’s customized financing arrangements, scalable funding that can increase as business grows, and its ability to strengthen the company’s credit and collections capabilities overseas. With Tradewind’s facility in place, the company is able to better allocate its capital, become more proactive in research and development, and invest in a new production line.

“It’s a great pleasure to work with a company that provides first-in-class parts to well-known brands all over the world. Tradewind’s cash flow solutions are a perfect supplement to their existing finance structure, and will be crucial to their technology upgrade, freeing up the capital that would otherwise be used to pay for raw material. We are glad to contribute to their growth and success story,” said Fiona Li, Sales Manager for Tradewind Shanghai.

Tradewind provides innovative international cash flow solutions tailored for global clients. Focused on the mid-market, its core products are non-recourse factoring and supply chain finance. The group has built an unrivaled reputation for the depth of its international finance expertise by maintaining a network of offices around the world including the USA, China, India, Hong Kong, UAE, Turkey, Bangladesh, Pakistan, Bulgaria, Hungary, Peru and its headquarters in Germany. Combining financing, credit protection, and collections into a single trade finance facility, Tradewind offers streamlined, flexible and best-in-class services.

The post Tradewind Provides $10 Million AR Financing Facility to Manufacturer of Automobile Parts Based in China appeared first on Tradewind Finance.

With high market share in the industry worldwide due to its consistent innovation and commitment to sustainability and environmental responsibility, the company was on track to build its global presence and increase sales further when it approached Tradewind for financing. To meet its working capital needs, Tradewind provided liquidity that supplemented the company’s existing line of credit with its bank. Because the finance firm offered flexibility, including limited security requirements, and worked with a bank in Europe that the manufacturer also used, it proved to be a productive partnership for the company to maximize its liquidity.

“It’s a great pleasure to work with a premium brand that has such a global reach. Our non-recourse AR financing facility is a perfect supplement to their existing bank facility and is really helping facilitate the company’s expansion, both in the US and internationally. We look forward to being a part of their growth story and long-term success,” states Brian Dowd, Vice President of Tradewind’s New York office.

Tradewind provides innovative international cash flow solutions tailored for global clients. Focused on the mid-market, its core products are non-recourse factoring and supply chain finance. The group has built an unrivaled reputation for the depth of its international finance expertise by maintaining a network of offices around the world including the USA, China, India, Hong Kong, UAE, Turkey, Bangladesh, Pakistan, Bulgaria, Hungary, Peru and its headquarters in Germany. Combining financing, credit protection, and collections into a single trade finance facility, Tradewind offers streamlined, flexible and best-in-class services.

The post Tradewind Provides $7.5 Million AR Financing Facility to US-based Manufacturer of Battery and Power Solutions appeared first on Tradewind Finance.

The client chose Tradewind because of its non-recourse factoring, which provides credit insurance for the company’s foreign receivables. Additionally, Tradewind’s collections capabilities and the improved cash flow management that results from their implementation further helped it stand out as the preferred financial partner.

With the export factoring facility in place, the client anticipates an annual factored volume of $25MM – $30MM.

“We are pleased to announce the onboarding of an industry-leading client in Bangladesh. With the assistance of Tradewind, the client will be able to maximize growth with existing customers and capitalize on additional growth opportunities with prospective customers,” says Soheil Zali, Country Manager of Tradewind Bangladesh.

While Tradewind Bangladesh has its roots in the textile and garment sector and predominantly serves this industry, it is poised to branch out into other segments in manufacturing where there is a demand for liquidity, including frozen foods, leather and leather goods.

Tradewind maintains a network of offices and affiliates all over the world, including Bangladesh, Bulgaria, China, Hong Kong, Hungary, India, Pakistan, Peru, Turkey, UAE, and USA as well as its headquarters in Germany. Combining financing, credit protection, and collections into a single suite of trade finance products, Tradewind brings streamlined, flexible and best-in-class services to the world’s exporters and importers.

Tradewind is a member of the German Federal Financial Supervisory Authority (BaFin), Factors Chain International (FCI), the International Factoring Association (IFA), the Commercial Finance Association (CFA) and the Bangladesh German Chamber of Commerce and Industry (BGCCI), among other organizations.

The post Tradewind Finance Provides Post Shipment Finance Facility to Bangladeshi Battery Manufacturer appeared first on Tradewind Finance.