Tips on how to fund your exportation business

Funding your export business? Depending on the size of commodity you’re looking to export, there are several options for funding available to you. Let’s review some of the options out there, and then you can decide which suits your best.

Commercial banks

This option is best suitable for medium and large scale exporters are more likely to get loan from Commercial banks than small scale or even worse, beginners. These banks would most likely request bank statements showing how much you’ve invested in the business already and cash flow into your business. They’d also require you provide collateral and other necessary documents that show they can get their money back as agreed.

The government

With the government working hard in diversifying country’s revenue from oil, they have continued to roll out several incentives to support non oil-exporters over the years.

Unlike private organizations like the commercial banks, you can get Government support(which can be in form of credits, grants, waivers, subsidies, etc.), at little or very low cost, which would turn out be the springboard to propel exporters to greater profitability.

We will look at several bodies through which government provide these supports:

a. Bank of industry(BOI)

The bank of industry provide several grants and funding support programs for exportation yearly. Most times these funds are released through several other bodies as related to the industry, like NEPC(Nigerian export promotion council), MAN(Manufacturers Association of Nigeria), etc.

b. The Nigerian Export Import (NEXIM) Bank

The NEXIM’s main purpose to provide financing for importers and exporters.

They offer wide range of funding options, such as:

• Direct Lending Facility (DLF)

• Export Credit Insurance Facility

• Stocking Facility (for manufacturing exporters)

• ECOWAS Interstate Road Transit Scheme

• Foreign Input Facility (for manufacturing exporters)

• Local Input facility

You can check up their website to see explore more options available and how to get them.

c. The NEPC (Nigerian Export Promotion Council)

The NEPC provide export incentives for exporters. These can be monetary, tax or legal provisions put together to support exporters of certain goods and services in Nigeria. There are two financial support programs the NEPC provide to exporters: Export development funds, which is more suitable for beginners and small scale exporters, and Export expansion grant(EEG), for large scale and more experienced exporters. You can always head over to their website to check the processes to get started.

Your buyer

Yes, your buyer can help fund your exportation. You can ask for upfront payment. However this method is often possible on the sound foundation of trust. So few question, why should any business trust you? What are the things about your business that can make any buyer trust you? For a beginner and small scale exporter, can you leverage other several respectable brands to give you much credibility? How do you go about that? It’s all left to you.

Associations

You can also get funding from associations. However you’d most likely have to be a trusted member before you can have such access. The good thing about these associations is the trade and industry knowledge you’d gain as you relate with other like minded exporters. To be a member, most require membership fee plus other vital documents. Although recruitment criteria vary across several associations, they want to add as much quality to their group as possible. They’d want to know if you’d be trusted.

Cooperatives

There are several cooperatives you can join where you can get constant funding to facilitate your trade. The good thing about cooperatives is you can get loans at very low interest, so long as you’re diligent in your paying back of the loan. This method of getting fund is suitable for all exporters of different levels.

Personal savings

There’s no one in this world who can believe in your business as you do. One of your first steps in business would mostly come from you funding your business from your pocket. For small scale exporters, personal funding is a very viable option, because you’re operating on a small scale, it is easier to raise the capital from your savings. In the future should you decide to approach the banks, or any investor for funding your bigger trades, they can listen to you as they can see you’ve been investing in the business.

Friends and family

Friends and family will always be there to support you. Beautiful thing about this is most friends and family might not require interests, some can even give you enough time as you want to pay back- just ensure you refund.

Getting funding for your export endeavor is an essential part of your business, and you will need funds as business grow. You should always look to reduce the risk of funding your export by trying out some of the methods we shared on here.
For beginners and small scale exporters, try to be attentive to the several government incentives rolled out, and look for ways to benefit from them.

4 ways to be profitable in export business

When we go into business, it is to make profit. For exporters (particularly start up exporters), having an understanding what you should do to be profitable on a regular would help sustain your business.
Let’s delve right into it.

  1. Understand how to use hedging to mitigate currency risk
    Currencies fluctuate. Every day events take place in the world, and these events have positive or negative effect on currencies. Every exporter has to deal with the risks associated with dealing in foreign currencies such that whatever happens you get your projected profit from your export. Imagine the value of GBP(Great Britain Pound) was N450, then two weeks later the value of GBP appreciates to N480. That’s N30 loss per unit on what you’re exporting.
    But what if you and your customer agreed on the exchange rate N450, and then you both worked out a way such that even if currency falls or rise, both party is assured of not being on the loosing side due to fluctuating currency price? That would be great, right?
    This is called hedging. Hedging helps both party bullet proof from whatever the price of any currency might be valued at in the future.
  2. Do thorough market research of your target market.
    Your market research should help you understand your market. It should help you gauge demand level, and how best to stay profitable with the market.
    Some tips to help your research is following industries relating to the commodity you’re exporting. For example, for a cocoa exporter, the chocolate industry is a good industry to follow. An increase in demand for chocolate is good indication of a booming cocoa exportation to that market.
  3. Secure low interest funding for your exportation.
    Because you don’t want to get loans that can put pressure on your margins, looking for some low interest loans or maybe government grants should be the way to go for you.
    Trying to get funds to facilitate your trade can be daunting. So exploring several options is crucial for you to remain profitable.
  4. Be creative with marketing and promotion
    After you’ve done thorough market research, it is time to start reaching out to your market.
    There are several way to promote your products to the international market, however, which ever way you choose to reach your customers must be able to give you edge in terms of long term profitability.
    Another important tip on this is once you’re able to find any customer who can trust you enough to want to do business, don’t disappoint! Your existing customers can bring more customers for you, this serves as a cost effective way to expand your business in your target market.
    Other ways to promote your business include run targeted adverts online or you can leverage on export agencies to access their network of buyers.

Cokodeal Invites Partners and Investors to Drive Export Businesses

Cokodeal featured on Guardian news

https://guardian.ng/business-services/cokodeal-invites-partners-and-investors-to-drive-export-businesses/

Africa is blessed with immense natural resources and its rich soil, which makes it the
epicentre for Agriculture and mineral commodities. There’s a lot the continent has to offer


Africans and the rest of the world as the gap between local production and markets
widen, but sellers and buyers are closed on leveraging technology to bridge it.
For an average business person in Africa, they always have to go the extra mile and do more with lots of resources to be able to access international markets and to find buyers for products, or risk selling within local economies that give low value for production. This and many more reasons are why many farmers are termed poor and the youth are discouraged to go into Agriculture.


The fragmentation of African markets and the lack of connections with genuine buyers globally is limiting its trade effort and potential especially for small and medium business owners.


A recent study by McKinsey shows that if many business owners and graduates in the African continent can have access to trade more seamlessly globally, there will be a drop in unemployment and growth of new industries.
In an interview on Aljazeera, Billionaire Dangote stated that ”Agriculture and ICT has
great potential and that is where to focus now.” There’s a need for African nations to look inward and work towards integration of its markets.


It is important to note here that recent growth in Africa’s economy has been linked
directly to increasing levels of foreign investment, which has been attributed to
improvements to fiscal policies, governance and regulatory frameworks, along with a move to diversify economies away from Africa’s traditional commodities-biased economies. All these create a safe haven for foreign Investments.


More than before, governments need to work towards a more regional integration in
order to achieve a more sustainable and inclusive growth for the continent.
While this gap in regional integration is being created and becoming more and more
obvious, Cokodeal has already set in motion an infrastructure of satisfactorily filling the gap.


Cokodeal, has said it is aiming to integrate more export-based businesses into the
foreign trade to find buyers in UK, USA, Dubai, Canada and Asia markets through its
platform.
Coming into operations since 2012, Cokodeal is a digital export platform for foodstuff and commodities produced in Africa. The platform helps to give market access internationally and increase sales for local manufacturers and producers.

Through best-in-class sourcing and negotiation technology, Cokodeal helps local
businesses integrate into global trade, and with its professional advisory, helps alleviate communication gap for semi illiterate traders.
Over the last decade, the company has done a lot in discovering several resources within Africa many never thought existed such as; stone flower, gum Arabic, cobalt, gypsum, scrap copper and other generic ones like coffee, sesame seeds, gold, flowers, ginger, cashew nuts, shea butter..etc. These products are in large demand across the USA, UK, Canada, Europe and Asian markets as discovered on its platform.


With what Cokodeal is bringing to the fore in Africa, buyers of commodities in foreign markets can directly find organisations to trade with in Africa, all in one place. The illiterate and semi-literate producers can get technical support for putting their products online and reaching millions of potential buyers – light years ahead of what they used to do piling their goods on lorries and carrying them across vast distances. Sellers too can now benefit from sourcing from a verified pool of buyers for which certain controls havebeen put in place to ensure heightened trust in the trade interaction.


The president of Cokodeal organisation, Mr. Mike Dola, in a recent conference: The
African Farmers Stories “Unlocking the food supply chain amidst Covid-19” hosted by Parminder Vir OBE, the co-founder of Support4AfricaSMEs, states that ”market access is critical to the growth of African businesses as without it, it hinders their growth, no better time than now to fully integrate African businesses into global trade”

There’s no doubt that the tides are changing, African Nations are beginning to look within for solutions as the current depreciation of currencies indicates the need for re- strategizing and collaboration within the continent. Recently, the president of Nigeria restricted foreign currencies at bank rates for importation of food items and fertilizers for people to look inward and produce.


Africa’s development must be underpinned by further regional integration and trade
liberalization. While the rest of the world becomes increasingly fractured and disparate, it is time for Africa to create ways to better integrate its fragmented markets which have long constrained growth and acted as barriers to trade.


The Cokodeal platform has curated some of these local producers and the resources
produced by native people is immense. In exploring these large resources, the
organisation welcomes partners and investors to explore this massively growing industry to drive growth for African trade as it directly impacts the lives of many farmers and manufacturers.

Digital accessibility is Africa’s Nexus in strengthening its standard of living and
wellbeing of its people, harnessing these resources and exporting to regions that are
constantly in need of them.
More exports increases the trade balance and strengthens our currencies, consequently causing it to appreciate in value and improve our economies.
There are so many opportunities to tap in the commodities market and there are lots of gaps to fill, and Cokodeal is opening up opportunities to interested investors and
partners.

This is with an aim to achieve its vision of helping commodity traders and small business owners in Africa realize their full trade potential and increase their wellbeing through information technology.


The organisation is providing options to become partners and shareholders in the
company, by raising funds and leveraging partners to access larger markets.
This is open to private individuals, business partners and company associates.
Early investors and partners would have a great deal of advantage of joining early as the company becomes very valuable and more attractive to larger investors.


The Cokodeal corporation can be reached on service@cokodeal.com for more
information on how to take advantage of this partnership opportunity.

Cokodeal woos partners with AI-enabled export platform for wider reach

Cokodeal as featured on Vanguard News: https://www.vanguardngr.com/2020/09/cokodeal-woos-partners-with-ai-enabled-wider-reach

Cokodeal, a major player in Africa’s commodity market, has said it is positioning itself as the centre for commodity export for Africans, using Artificial Intelligence to connect and match real-time buyers across the world with African traders on the platform. Noting that there are so many opportunities to explore in the international trade space and Africa Continental Free Trade Area, AfCFTA, agreement, Cokodeal.com said it is providing options to interested investors to become partners and shareholders in the company.

This, it said in a statement by its Co-Founders, Mike Dola and Michael Olufemi, will lead to raising of funds and leveraging partners to access larger markets, a plan that is “open to private individuals, business partners and company associates.” According to Cokodeal, “This funding will help to develop a more robust technology infrastructure for the platform, align its vision and better deliver product efficiently, register 6,000 agents across Nigeria that will help generate real-time trade information and coordinate deals in their local communities.

“This will develop strong collaborations and partnerships with larger organisations locally and internationally, to run digital marketing campaigns globally to drive huge numbers of buyers for its businesses to do bigger and better deals. “A series-A funding is in the pipeline in an ongoing deal flow with venture capitalists.

This fund will allow the company to better compete in the global space, becoming a household name and trading partners across the world. “Investors and partners would have a great deal of advantage in joining early, as the company becomes very valuable and more attractive to larger investors.”

On the benefits of the partnership, Cokodeal noted that from fashion to agriculture, the continent has seen an emergence of entrepreneurs in recent years creating quality and bringing the best products into the market. “Although resources abound, inter-trade and intra-trade seems to still be quite limited in the continent. “The global market is interested in many of these locally-produced goods, but don’t know how to find and reach manufacturers.

“The local producers on their end really have no knowledge of the extent their products could reach and as such still remain in the same spot within weak economies for a long time, which leads to stunted growth.

“Cokodeal has found this sweet spot, taken advantage of the opportunity and is currently filling the gap. “With technology, we have been connecting commodity traders in Africa to the local and global market effectively, efficiently and quickly since we launched in 2013.”

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