International Exports facilitates transactions between international buyers and domestic suppliers.
Who is International Exports?
International Exports Inc. is a distributor of Canadian products to the international market. International Exports acts as a middleman to facilitate transactions between international buyers and domestic suppliers.
The customers of International Exports are brokers that have relationships with retailers in their respective markets. The brokers are primarily located in the United States among other countries.
A typical transaction would be a trailer of used vehicles. The vehicles are normally purchased through auctions. The partners of International Exports have established relationships and have been processing these transactions for a number of years. The partnership with International Exports allows their partners to accelerate their business and fulfil a backlog of orders that have not been executed due to a lack of capital.
How Does Export Development Canada (EDC) Work?
EDC approval is a prerequisite to International Exports processing a transaction. International Exports has been financing transactions with EDC for over 25 years.
For illustration purposes, assume a purchase order of $500,000 of vehicles is received. International Exports submits an application to EDC to approve a potential buyer and the $500,000 transaction. EDC researches the company and agrees to provide a 100% guarantee of the receivable once the product is shipped. The insurance cost is approximately $2,500. The transaction is processed, the insurance fee is paid, the product is shipped and the supplier is paid. Once the buyer pays for the order, the buyer’'s account with EDC is reset and they have an opportunity to purchase more product under the EDC program. It is the responsibility of International Exports to update the status of all files through an EDC portal.
In the event that the buyer defaults on their payment, the EDC insurance kicks in at 90 days and $500,000 is paid to International Exports. EDC then deals with the buyer and pursues them for payment.
To date, Canada Exports has never had to exercise the insurance due to a lack of payment.