Let’s pretend that you are a widget maker and that one of your customers wants to buy $100,000 worth of your widgets. This is a great opportunity for your business. You begin to question whether or not you will need a deposit. Whether you should sell to them. Does this pose a risk to your business? Will they pay? If not, what can you do? Can you cashflow the deal? Sales is really pushing you to close the deal but can you handle it. Is your cashflow in jeopardy?
This is a common challenge that businesses face. Knowing what you options are is where we come in. If you need to increase sales without assuming more risk, want ot borrow better or get the cash flow you need by protecting your business from non payment of receivables then credit insurance is right for you.
If you could be 100% certain about your credit risk, what would your company’s growth strategy look like?
Our network of risk experts — combined with the most comprehensive and accurate business information database in the world — offers you strong local business knowledge and an unrivaled spectrum of credit data on your potential customers.
Combine a network of risk experts and the most comprehensive and accurate business information database.
Provide an early warning system with alerts so you can avoid potential payment risks before they occur.
While simultaneously avoiding problem accounts.
Pay when your customers don’t.
Credit insurance is one of the only insurance products where you can generate a return on investment. If your receivables are insured you can safely sell more to your existing customers, go after new customers that may have been a credit risk in the past, and expand into new markets that you originally perceived to be too risky. Credit Insurance allows you to make instant credit decisions and speed up the long process of waiting on credit apps to be completed and eliminate the dreaded “personal guarantee” that your customers don’t want to complete. You can eliminate that tension that can come from aggressive sales people and conservative credit departments. This allows to sell more aggressively without the risk. You will sleep better at night knowing you will be able to collect on the goods and services you sold.
All the ways credit insurance helps business owners:
Call today to get a formal quote for your business!
Many times, our clients pick up one large deal. While they have comfort selling to their other customers, this one particular deal puts them out of their comfort zone. They either have to borrow to fulfill the order and the bank is unwilling due to concentrations, or they simply don’t feel comfortable extending that much credit to one single customer. Often times, these large orders will request longer terms than normal, 60 days, 90 days. This can jeopardize cash flow and definitely cause sleepless nights.
Credit insurance can help with this scenario.
You don’t have to insure your entire portfolio. Leykell can structure a deal with many carriers that can accommodate this type of transaction.
Traditional asset based lenders will advance 75-80% on receivables. They will also exclude foreign A/R and eliminate certain receivables due to concentration risks. This can cause problems if your business utilizes or would like maximize a line of credit. With credit insurance, banks can lend up to 90%, often times at lower rates (as the risk is transferred from the bank). Banks will also lend on foreign receivables and eliminate concentration risks. Credit insurance is also a great alternative to letters of credit. It is much cheaper and you don’t have to deal with the complications of letters of credit. A letter of credit can cost up to 2% and tie up your customer’s bank line. Credit insurance typically will cost .25 bps and allow you to give open terms internationally with guaranteed payment. Credit insurance will also allow you to eliminate or reduce your bad debt reserve while converting this into a tax deductible insurance provision. Credit insurance will also help forecast losses (they are in the form of your policy).
When the unexpected happens rest easy knowing you have credit insurance.
How can you borrow better?
Call today to get a formal quote for your business!
When you sell on credit terms your company is always at risk of default or slow pay, which can cause devastating consequences to your cash flow and profitability. If your receivables are insured you can safely sell more to your existing customers, go after new customers that may have been a credit risk in the past, and expand into new markets that you originally perceived to be too risky.
Trade Credit Insurance allows you to make instant credit decisions and speed up the long process of waiting on credit apps to be completed and eliminate the dreaded “personal guarantee” that your customers don’t want to complete.
Leykell Insurance provides clients with the right information to make informed credit decisions, so you can minimize your losses. Call our office for more details on credit insurance today. We can help you and your customers mitigate your risks due to non payment. Sleep soundly knowing that Leykell has you covered.