Question : I'm keen to grow my business and considering targeting the south of the border to do so. Would you recommend this strategy and if so can you offer me any advice or tips of what to look out for?
Nick McCafferty, Regional Sales manager Bibby Financial Services Northern Ireland says:
One of the few positive outcomes of the economic downturn has been an increased willingness by SMEs to refocus on opportunities in different markets and the Republic of Ireland is an ideal place to start.
Tantamount to the success businesses are seeing in doing so, are the InterTradeIreland figures which show that a third of firms from Northern Ireland and a quarter of firms in the Republic are now involved in cross-border trade. And Northern Ireland's export activity to the Republic is currently worth £2.1bn, 37% of the NI total export market, according to figures released by the Department of Enterprise.
However, though there are many opportunities for business growth, made easier by the close geographical location and improving transportation links, cross border trade can still present the same challenges as doing business overseas.
Problems associated with the practicalities of doing business in a different market - which can occur both when first starting out, and at a later point - typically include issues such as late payment, currency fluctuations and access to finance.
At the heart of this is the requirement for flexible funding to ensure that you are focusing on business development rather than on credit management - which can be a daunting prospect in a market you are not familiar with.
To deal with this and to ensure a constant stream of funding, SMEs in Northern Ireland are increasingly opting for export invoice finance for cross-border activity. This is something you may want to consider.
The main benefit of export invoice finance is its flexibility which works particularly well when pursuing new markets - it gives your business access to working capital on a 24 hour basis and as sales grow, so does the amount of cash available to the business.
In addition, as part of the service an invoice financier can chase and collect outstanding customer payments on your behalf which will avoid any potential late payment issues.
Another major advantage is the fact that it will help protect your business against currency fluctuations - you can choose whether to be funded in sterling or in euros.
Invoice finance providers such as Bibby Financial Services also have offices both sides of the border thereby offering on-the-ground support and helping ensure payment on your behalf.