a capital budget, which is a longer-term overview of the funds you'll need to complete your export project, that provides an operating plan against which you can measure actual expenditures and revenues and tells you when the project will start generating positive cash flows.a cash budget that highlights your financing requirements over the next two or three years, so you can determine the timing and amount of your cash expenditures.The most important objective of your plan, however, is ensuring that your company always has sufficient cash or operating lines of credit. If you don't have one, it will be very difficult to arrange the financing your venture may need. You will also need a comprehensive financial plan for the export venture. 8.2 Leveraging capitalĮven though Canada is one of the least expensive countries in the world in which to do business, the costs of exporting can add up.īecause of this, your export drive will need a reliable cash flow. Ask for advanced payments to cover the cost of increased demand and reduce risk. Tipīe prepared to meet increased demand from a successful foreign sale. Information to help you learn about export financing is also available from the Canada Business Network.Įxport Development Canada provides an extensive list of tailored online resources to help you determine your financing needs. Their services are inexpensive and often free: the TCS doesn’t charge for any of its services. Sources such as the Canadian Trade Commissioner Service (TCS), Export Development Canada (EDC), and the Business Development Bank of Canada (BDC), offer help ranging from market-entry support to the provision of working capital. Yes, you can! Expanding your capacity to fill foreign orders won't necessarily demand large capital outlays or a lot of new staff. Fortunately, there are options that can minimize your risks and even give you a competitive edge.

Self-financing a growing export business can be very risky, especially for new or smaller exporters.

If by chance your first international order is far larger than you expected, how are you going to finance the expansion you need? Payments can take months, and buyers may default or go out of business. 8.1 Understanding the risks of export financingĨ.1 Understanding the risks of export financing.Step 8 – Identifying your export financing requirements.Demanding payment up front can be a terrible insult in some cultures. It's important to be diplomatic, especially when 'securing payment' for overseas sales.

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