The UK’s expertise in the experience economy is recognised the world over, and that means there’s global demand for the UK services sector – from Asia to Africa and America.
This is great news – after all, there’s no better way to grow your business than to tap new markets. The question is, how can you make sure you’re ready to seize these export opportunities?
That’s where UK Export Finance (UKEF) comes in. UKEF is a government department that offers finance and insurance to UK companies to support their overseas sales. From winning contracts, to financing delivery and making sure you get paid; when you can’t get the support you need from your high-street bank or insurer alone, UKEF is here to help.
UKEF can support exports of all kinds, including services and intellectual property, and businesses of any size.
Take Barker Langham for example – a small cultural consultancy based in London that curates cultural heritage projects around the globe, including Alexandra Palace down the road and the National Museum in Qatar.
The company has found particular success in the Middle East due to the rapid rise of tourism, but in this market it is also common for buyers to request contract bonds from their suppliers. When Barker Lanham won two contracts for work in the UAE, it was asked to provide performance bonds from its bank to secure the deals.
However, due to the large value of the contracts, the deposits required by its bank in return for issuing the bonds posed a financial challenge for Barker Langham, which, as a small company, needed to retain enough liquidity to pay its staff and finance the contracts’ delivery.
What’s more, as a small business lacking access to the expertise and resources available to larger companies, Barker Langham found the unfamiliar process of applying for the bond a hurdle in itself.
Fortunately, UKEF could help with both problems.
UKEF guided the Barker Langham through the process, answering its questions along the way, and through UKEF’s Bond Support Scheme, gave Barker Langham’s bank a guarantee worth 80% of the performance bonds’ value.
This significantly reduced the size of the deposits required, allowing the company to secure the bonds while holding onto sufficient cash to deliver the contracts, and thereby expand its business further in this important market.
Hannah Phung, Team and Project Manager at Barker Langham, commented:
“Without UKEF’s help, we would have just gone around in circles and it might have taken so long to get the bond that it would have jeopardised the deals. Actually being able to actually speak to someone at UKEF about our situation and get specific answers on what to do made a world of difference.
The Bond Support Scheme was really vital to the success of these contracts for us, and now we know the help is there, we can be confident in seeking more business abroad.”
Similarly, if you need extra cash to help you deliver an order, UKEF can also guarantee up to 80% of the value of a working capital loan, helping you to secure a larger loan than you could have otherwise, supporting your cashflow or enabling you to take on bigger orders.
So, the next time you bid for an export contract, consider whether government-backed finance from UKEF could give you the edge you need to win.
Complete this quick form and we’ll get in touch to tell you whether UKEF support could help you.