Business owners who already have a facility like debtor finance typically will consider if their limit size is appropriate for their business over the next few years and source the cheapest rates and fees they can.

You should be looking at these metrics and obtaining the best value for money but a consideration that’s often missed is a review of the finance structure.

Our client came to us with a small trade finance limit of $500,000 with up to 90 day terms and a debtor finance limit of $2M at their existing lender. Looking at their product and cash flow cycle, we identified that $2M Trade finance facility with 180 day terms could be sufficient without the need for any debtor finance facility beyond the initial refinance.

With no line or service fees and a low interest rate this dramatically reduced the cost of finance in the business and translated to a forecasted year on year savings of $95,000 pa.

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