International business? How to manage foreign customers

If there is one thing that the Italian business is proud of, it is the recognition of the high quality of its production by foreign customers. An appreciation that embraces different sectors and intertwines with a dense network of relationships linking both medium-small and larger companies to other European and non-European countries. However, commercial dynamics in these areas are not always easy, and several doubts can arise for the entrepreneur who must navigate these waters. We talked about this with Claudia Reale, Head of Supply Chain Finance International at Banca Ifis.

What could be the main advantages and complexities in expanding my company's exports?

Internationalisation represents a major growth factor for companies: the penetration of new markets allows companies to increase their turnover and diversify the risk of concentrating their activity on a single country, protecting themselves from the cyclical risks of the domestic market in periods of stagnant demand. However, there are informational gaps (legal, commercial, or financial) that can make approaching new markets complex, especially for small companies.

Factoring is an optimal tool to overcome these difficulties as it offers credit management, guarantee, and financing services, allowing exporters to:

Protect themselves against the risk of insolvency
Always have up-to-date information and assessments on foreign customers
Reduce the fixed costs of credit management by outsourcing the management and collection of receivables to the factor
Obtain an additional source of financing, improving their liquidity
Increase turnover by offering more competitive payment terms

What tools can help my company in managing relationships with foreign customers?

Factoring is a very flexible tool for managing foreign customers: through the stipulation of a single contract, the supplier can cover risks associated with multiple debtors residing in different countries. The approval is issued in the form of a revolving credit limit, therefore it covers all supplies made within the capacity of the credit limit and for an indefinite period of time (unless revoked).

In addition, the outsourcing of credit management activities allows the client to focus more on the commercial and relational aspects: Banca Ifis provides, directly or through its correspondents, for the management, follow-up and collection of assigned receivables; in case of need, it collaborates in the resolution of disputes and deals with the definition of repayment plans or the judicial recovery of receivables.

Find out about our import/export factoring solutions

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In the context of Supply Chain Finance International, do my clients contact the bank, or do I introduce them?

Banca Ifis offers both direct factoring and reverse factoring services dedicated to companies active in both the export and import sectors.

In the first case, the exporter will propose to us the foreign customer portfolio that he is interested in selling and, with reference to the positively evaluated customers, we will offer the guarantee and management services for the assigned credits (directly or by relying on corresponding factors that operate in the country of export).

In the second instance, however, the importer, having been evaluated in advance by Banca Ifis, will introduce us to its foreign suppliers to commence onboarding, so we can offer our services (management, guarantee, early credit release).In this case, therefore, the importer will engage in a reverse factoring process and, following the guarantee offered by the bank to its supplier, will be able to negotiate improved supply terms or an extension of payment conditions with the supplier or directly with the bank through the maturity service with deferral.

Advertising message for promotional purposes. For the contractual conditions of the Factoring solutions, refer to the information sheet available at our branches and in the Transparency section of the website www.bancaifis.it.

13 December 2024