Such firms are not necessarily large businesses—many small to medium-sized Canadian enterprises (SMEs) are discovering that investing abroad can have many benefits, including:

• Getting better access to foreign markets
• Increasing sales and market share
• Serving customers better
• Joining new global and regional supply chains
• Gaining access to new technologies and resources
• Reducing vulnerability to downturns both in Canada and internationally

Investing abroad: the basics

There’s no one-size-fits-all approach to CDIA, but in general it includes some or all of the following steps.

A word of caution first, though: foreign investing is complicated, so you should always obtain assistance from reputable experts throughout the process.

Consulting professionals in your target market is especially important, since they will be familiar with local investment, legal and tax requirements and can help you avoid expensive mistakes.

1. Decide whether CDIA is for you:

CDIA may or may not be a good bet for your business even if you’re already exporting. Ask yourself questions such as: Does it fit my international business strategy? Do I have the resources to set it up and sustain it? Does its potential outweigh the risks involved? If the investment isn’t a good idea, now is the time to find out.

2. Find the best market:

If you’re already doing business in a particular market, investing there may be the logical next step. If you’re looking to invest in a new market, research it very carefully and, as mentioned earlier, consult local experts about its foreign investment climate. Some countries encourage incoming investment but others can be less hospitable.

 3. Choose your investment approach:

Three of the most common approaches to CDIA are as follows:

• You set up a foreign affiliate by establishing a new business in your target market. Depending on your company, this could be as modest as a small sales office or as ambitious as a full-scale manufacturing plant. Regardless of size, the affiliate is wholly owned by your Canadian firm but operates as a local company with respect to regulations, laws and taxes.
• You acquire a foreign business. To do this, your company invests in the foreign firm by purchasing its shares and/or assets. To qualify as CDIA, however, the investment has to be large enough to give you significant influence over the foreign company’s activities. If you acquire 100 percent of the foreign company, of course, you have complete control over its operations, and have effectively acquired a wholly owned affiliate without building it from the ground up.
• In a merger, you establish or already have an affiliate in the target market. You then combine that business and a local company into a new firm that owns the resources of both companies. Both the original businesses disappear and your new firm continues as their successor. As with an acquisition, the new business functions as a wholly owned affiliate of your Canadian parent company.

4. Choose your investment and carry out due diligence:

At this point, you decide where to put your money—into an affiliate, for example, or into merging with or acquiring a local company. Before going ahead, though, you absolutely carry out due diligence. This can range from financial and credit checks to looking at local foreign-investment rules. Again, professional help will be indispensable.

5. Make your investment:

This is where you sign contracts and pay out money. The importance of getting the contract right can’t be over-emphasized, since it will help you avoid difficulties that can range from language issues to tax problems.

You should also be aware that the way contracts are negotiated in North America or Western Europe can be very different from the way it’s done in other cultures.

For both these reasons, you’ll need trusted local counsel to help you manage the process successfully.

6. Protect your investment:

Whenever you have assets in another country, you’re implicitly accepting some level of risk. You can reduce this by careful planning and scrupulous due diligence, but there may still be residual hazards that are out of your control. You can protect yourself against them by using various types of insurance, which can cover risks ranging from expropriation to breach of contract.

Want to learn more about investing abroad? Watch a video with me and Dominique Bergevin, and then visit EDC’s Invest in Foreign Markets pages.

Have you ever invested abroad? In which markets did you invest, and what was your experience? Share below!

If it’s doing either, are you aware of how the political risks of these markets can threaten your bottom line?

If you’re not clear about the hazards, or if you recognize them but don’t manage them systematically, you’re not alone. According to recent research, many businesses—both in Canada and abroad—don’t do nearly enough to reduce their exposure to political risk in emerging markets. These risks include:

• Import/export restrictions
• Foreign exchange restrictions
• Breach of contract by a foreign government
• Changes in laws and regulations
• Expropriation
• Civil disturbance and other forms of political violence

As Canadian firms look for new business abroad, especially in emerging markets, the urgency of managing these risks will steadily increase. Many businesses, in fact, are now confronting these hazards and are deeply concerned about them.

As just one example, a 2013 survey of more than 450 multinationals that operate in emerging markets revealed that political risks are already affecting their bottom lines. One in five of these companies had suffered a loss from civil disturbance during the previous three years, one in four from foreign exchange restrictions and one in three from breach of contract by a foreign government. And the situation is likely to get worse, not better.

Other research now places political risk among the top 10 hazards facing organizations today.

Given these developments, it’s a puzzle that so many businesses pay so little attention to political risks. This is even more surprising when you consider that effective political risk management can provide important benefits such as:

• A better understanding of how political events could affect your investments.
• The ability to seize opportunities in markets that could be very profitable, but involve political risks.
• The ability to make better decisions about how to reduce your political risks.

To sum up: By not managing your political risks effectively, you may expose your company to severe losses while losing out on some important advantages. This, obviously, doesn’t make a lot of sense.

Four steps to managing political risk

The key to protecting yourself is to have a clearly defined strategy for managing your political risk, with a formally designated risk manager who’ll watch for these hazards and find ways to deal with them. One of the most common strategies is a four-step process based on identification, measurement, mitigation and monitoring.

1. Identify your risks

Through your risk manager, you gather pertinent information about the types of political risk your company faces, or is likely to face, in the target country.

The objective here is to find out how political conditions may affect your goals in the market.

Next, you identify the political risks that most threaten these goals. Seizure of assets might be a low-ranked hazard if you’re only exporting to the country from Canada, for example, but potentially a serious one if you bring valuable assets into an emerging market to perform contract work on the ground.

2. Measure your exposure

You rank the risks you’ve identified and measure your exposure to each one. This involves attaching numbers to the risks to reflect their potential financial effects on your company. These measurements will help determine whether the risk level of a market is within your tolerance, thus helping you decide whether to enter it.

3. Mitigate your risks

You take measures to lower the probability of a risk and to reduce its effects if it becomes a reality. How you do this will be determined by the nature of your company.  If you’re making an investment, for example, you could work with local partners whose familiarity with their market can help you avoid problems. To help protect you if trouble hits, you could purchase insurance that covers political risks.

4. Monitor your risks

Once you’ve established how your risk management process will work, you set up routines for reporting, evaluation and review. There should be formal channels for regularly reporting political risk issues, both upward to senior management and downward to the personnel who manage your on-the-ground operations. These routines should become part of your normal business activity, and your risk manager must make sure that they don’t fall into disuse as time passes.

As you’ll recognize by now, setting up a risk management process isn’t a trivial undertaking, and you may not have the internal resources to create the system you need.

In this case, you can turn to outside experts. There are numerous private-sector agencies that specialize in providing their clients with detailed information on political risks in world markets, and in helping companies establishing their political risk management systems.

Even companies with effective political risk management, however, may find that some markets leave them more exposed than is comfortable. In these cases, insurance can fill the gap.

Export Development Canada (EDC) has a full suite of insurance solutions that can help both investors and exporters cover many types of political risks when they are doing business in emerging markets.

Want to learn more about managing political risk in emerging markets? Visit EDC and download the new guide to Managing Political Risk.

Asia, for example, is now responsible for a third of the world’s GDP, while Africa has seven out of ten of the planet’s fastest-growing economies. And South America’s middle class is expanding by leaps and bounds.

For Canadian businesses seeking growth, such developments are very promising. At the same time, though, these new markets can be risky for the unprepared.

The single most serious hazard is not getting paid, for reasons that can range from a customer’s bankruptcy to a government’s imposition of currency controls.

Make sure you get paid during international trade

Your first line of defence against this danger is to effectively manage credit risk.

If you’re clearly aware of your foreign customers’ creditworthiness, as well as local political and economic conditions that may affect their ability to pay, protecting your receivables will be a lot easier.

Here are seven basic ways to lower the risk of not getting your money.

1. Thoroughly check a new customer’s credit record.

Finding foreign corporate information can be tricky, especially for emerging markets. Local consulting firms may be able to help, and you can also get assistance from the Canadian Trade Commissioner Service office.

2. Use that first sale to start building the customer relationship.

Your number-one tool for managing a customer’s credit risk is building a long-term, trusted relationship.

This can obviously take years to fully achieve. But start laying the groundwork by discussing your credit terms with a new customer before you extend credit. This will help you gauge the customer’s attitudes to credit, and ensure that they clearly understand what you expect of them.

Also consider using a “master sales agreement” with a new customer, rather than relying on purchase orders to set out credit terms.

3. Establish credit limits.

To set a credit limit for a new customer, you can use tools such as:

• Credit-agency reports, which can provide comprehensive information about a company’s financial history.
• Bank reports, which should give details of the bank’s relationship with the company, the company’s borrowing capacity and its level of debt.
• Audited financial statements, which can provide a good view of the business’s liquidity, profitability and cash flow.

4. Make sure the credit terms of your sales agreements are clear.

A sales agreement that includes well-worded, comprehensive terms of credit will minimize the risk of disputes and improve your chances of getting paid in full and on time.

5. Use credit and/or political risk insurance.

The Receivables Insurance Association of Canada provides useful information about insuring your company against non-payment.

If you decide to insure, EDC offers a full suite of insurance products that can protect you against non-payment, contract cancellation, breach of contract, expropriation, currency restrictions, political violence and more.

But make sure the factoring is on a “non-recourse” basis, which means you’re not liable if the customer defaults.

7. Develop a standard process for handling overdue accounts.

Your chances of collecting on a delinquent account are highest in the first 90 days after the due date.

If you have an established routine for dealing with late accounts, you can start the collection process as soon as you know there’s a problem.

How does your company manage credit risk and safeguard against non-payment? If you have other tips, share them with us below!

Want to learn more about how to manage credit risk? Watch a video featuring my colleague Dominique Bergevin and myself. Or download EDC’s white paper on Dealing with Credit Risk.

Doing business abroad can help you increase your sales and market share, reduce operating costs, improve competitiveness and gain access to new resources and technologies.

But even if you have a product or service that seems to have international appeal, your company may not actually be ready for international trade.

Doing business overseas is much more complicated than staying at home, and any successful exporter will tell you that they looked very carefully at their company before they decided to go abroad.

Is your company ready for international trade?

Like them, you can improve your odds of foreign success by carefully examining your business, finding ways to capitalize on its strengths and taking action to remedy its weaknesses.

Here are six important areas that deserve close attention:

1. Product viability

You’ll need to do market research to find out whether your products or services will, in fact, appeal to buyers in other countries. If you can offer something unique at competitive prices, your chances of success will go up. Conversely, producing and selling ordinary, widely available merchandise won’t usually work. And even if you do have an appealing product or service, you may still need to modify it (possibly at considerable expense) to meet foreign tastes and regulatory standards.

2. Company performance

If your business is doing well in Canada, that’s a big plus.

A solid cash flow and comfortable profit margins, supported by an effective business plan, make an excellent launching pad for an export project.

Conversely, trying to export from a shaky domestic foundation will only increase the strain on the company’s resources, which can be extremely risky. Moreover, it’s much harder for a struggling company to get financing for its export deals.

3. Human resources

Your human and managerial resources may be adequate for your domestic needs. But if your export business is more than a modest success (which is the goal, after all), you’ll need more people to handle the increased workload. That means recruiting, hiring and training, all of which will require company resources ranging from more office space to a bigger payroll. Be sure you’re prepared to expand this part of your business when the time comes.

4. Financial resources

Most small and medium-sized exporters can’t start an international operation using their own financial resources, so they go to their lenders for the working capital they need.

Unfortunately, it can be much harder to get financing for exporting than for domestic operations.

This is because international trade is inherently riskier than domestic trade, and because the banks know that most export ventures need a couple of years (at least) to start turning a healthy profit.

Consequently, you should find out from your lender how much support they’ll provide if you decide to go abroad, and for how long they’ll provide it. If they’re cool to the idea, you can go to government-backed lenders, such as Export Development Canada (EDC) and the Business Development Bank of Canada (BDC), that specialize in helping companies get started in international trade.

5. Production resources

One sure way to fail internationally is to secure a large contract and then be unable to fill it. Make sure you have enough spare production capacity—or can create it quickly—to meet unexpectedly large foreign demand. You should also ensure that your suppliers will be able to support your production commitments without causing delays or bottlenecks.

6. Logistics resources

Producing enough to fill an order is only part of the job—you still have to make sure your buyer gets your goods on time and in the expected condition.

You’ll need staff who are trained in export logistics and who will be able to troubleshoot delivery problems quickly and efficiently.

If you examine all the above areas and come up with positives across the board, you’re in good shape to start exporting. If you find some weaknesses, though, don’t give up—almost all non-exporting companies, at this early stage, have gaps in their preparedness.

But once you fill those gaps, you can go abroad with confidence and a solid foundation for international success.

Want to learn more about getting ready to export? Visit EDC’s Knowledge Centre and download Introduction to Exporting: How to Sell to International Markets and Diversifying Into Foreign Markets: A Guide to Entry Strategies.

With a population of over 300 million people and a 20 percent share of the global economy, it’s the richest market on earth, and it’s right on Canada’s doorstep. But the United States can also be a tough market—it’s intensely competitive, fast-paced and unforgiving, and an exporter who dives into it without careful planning will usually flounder, if not sink.

Conversely, a well-prepared Canadian company that has a good product and positions it carefully can do very well south of the border.

So how do you improve the odds of being one of those successes? If you keep these eight tips in mind, you’ll be off to a good start:

1. Get a handle on U.S. regional markets.

The U.S. market is actually a mosaic of many regional markets, each with its own economic characteristics and key industrial and service sectors. Depending on your product, some regions may offer you more opportunities than others, so market research is essential. You can start with the Canadian Embassy’s State Trade Fact sheets and the United States section of the Canadian Trade Commissioner Service’s web site for a regional overview of the country.

2. Get your product and marketing right.

Although the Canadian and U.S. business and consumer environments are similar in many ways, you may still need to modify your product, its packaging and/or your sales approach to match the expectations of potential U.S. customers. Keep those regional differences in mind, too—what works well in New England may not fly in the South.

3. Be sure your company is ready to export.

Take a close look at your company to see if you’ll need to boost your financial, managerial and production capacity to meet the demands of foreign trade. You’ll also need a detailed export plan that sets out your U.S. goals and how you’ll achieve them. The Exporting section of the Canada Business website can help you assess your export readiness.

4. Get advice from professionals.

The U.S. business and legal environment is extremely complex and varies from state to state. At the international level, the customs rules and regulations that govern U.S.–Canadian exports and imports are complicated and can be hard to follow. This means that obtaining professional advice about taxes, laws and compliance should always be part of your export planning and operations. For a general overview of compliance, you can refer to EDC’s online guide, Compliance in International Trade.

5. Pay a visit to the U.S. market where you want to do business.

But before you go, contact the Canadian Trade Commissioner Service for that region.

Trade Commissioners can provide you with information about market prospects and local companies, and can help you out with face-to-face briefings, contact searches and introductions.

6. Pick the right entry method.

There are several ways to enter the U.S. market. Direct selling—that is, traditional exporting—is the simplest method and works well for many Canadian companies. Depending on your business needs, though, you could opt for a representative or branch office in the country, or establish a U.S. subsidiary there. Setting up a joint venture with a U.S. firm, or acquiring an existing U.S. business, are other possibilities.

7. Get your financing in order.

Most companies work with their banks to get working capital for their domestic operations. But it can be harder to obtain financing for foreign deals because the risks are higher. Export Development Canada (EDC) can often help in these situations by providing various kinds of financing support, such as export guarantees.

8. Protect your bottom line.

The risk of non-payment is always higher in foreign trade than it is domestically. Also, your U.S. customers will normally expect open-account payment terms, which for you is the riskiest payment method. For protection, many Canadian exporters use EDC’s Accounts Receivable Insurance or Single Buyer Insurance, which can cover up to 90 percent of losses resulting from customer non-payment.

Sweet success

Ottawa-based HoneyBar Products International produces healthy snack bars that contain only nuts, seeds, dried fruit and honey. Until 1995, the company made its bars by hand and marketed them only locally. Now, though, it sells them by the millions through grocery stores across the United States and Canada, including retail giants Walmart and Safeway. The company uses EDC insurance to eliminate one of the big risks of selling across the border—non-payment by a foreign buyer.

Want to learn more about exporting into the U.S.? Download EDC’s Doing Business in the United States and watch a video with me and Dominique Bergevin.

Fluctuating rates also mean more guesswork in your budget forecasts, and they can make it harder to know exactly how much you’ll get paid when you complete a contract.

But that’s not all, according to Jean-François Lamoureux, a Senior Underwriter at EDC.

Remember that your bank wants to see good margins, accurate business forecasts and healthy cash flows before it issues credit.

“If you can’t offer these things because of poor FX risk management, it may curtail your ability to obtain the term financing you need. This can cause your growth and competitiveness to suffer,” he says.

Conversely, good FX risk management can bring your company the following benefits:

• Better protection for your cash flow and profit margins
• Improved financial forecasting
• More realistic budgeting
• Deeper understanding of how FX fluctuations affect your balance sheet
• Increased borrowing capacity, leading to faster growth and a stronger competitive edge

Create your own FX risk management program

These are all excellent reasons to take a hands-on approach to FX risk management. And while setting up a solid FX risk management program isn’t trivial, it’s well within the reach of any company willing to make the effort. To create your own program, you’ll need to take the following steps:

1. Analyze your business’ operating cycle to identify where FX risk exists.

This helps you determine the sensitivity of your profit margins to FX fluctuations and the stages of your operating cycle where you need protection.

2. Calculate your exposure to FX risk.

This covers both unconfirmed risk (the risk that exists before a sales agreement is finalized) and confirmed risk (the risk that exists after a firm sale is completed but you haven’t yet been paid). Once you know your level of exposure, you can decide how much risk coverage (“hedging”) you need.

3. Hedge your FX risk.

Hedging simply means that you use specially designed financial instruments to lock in the FX rate so that it remains the same over a specified period of time.

There are numerous ways to hedge, but as an exporter you’re most likely to use an “FX facility,” which you’ll obtain from your bank.

An FX facility resembles an operating line and can support various types of financial instruments (or “hedges”), all of which are designed to secure a specific exchange rate for an export contract so you won’t get any surprises at payment time.

4. Create an FX policy and follow it.

In this step you establish the FX risk criteria, procedures and mechanisms that will support your FX risk management program, and implement this policy across the company.

5. Don’t let hedges squeeze your working capital.

The essential advantage of a hedge is that it protects your profits from unfavourable movements in the FX rate.

The drawback is that your bank will want security for any FX facility it issues to you, which it will usually carve out of your operating line. This will leave you with less working capital, which is never a good thing.

There’s an EDC solution designed for just this situation: the Foreign Exchange Facility Guarantee (FXG). An FXG provides a 100 percent guarantee of the security your bank requires for providing you with an FX facility. Once the guarantee is in place, the bank won’t need to take the security from your operating line, which means you’ll have full access to your working capital.

The view from the front line

Normand Faubert is President of Optionsdevises, a Montreal consulting firm that for 20 years has helped exporters deal with their FX issues. In his view, a business that wants to take control of its bottom line and profit margins will follow carefully designed strategies for managing its FX risk.

“EDC’s FXG is a great tool for this since companies can sometimes be very tight for cash,” he says. “By providing guarantees, EDC can help them obtain the financial tools they need to hedge their FX risk, while avoiding any restrictions on their credit and thus on their working capital.”

Want to learn more about managing your FX risk? Watch a video with me and my EDC colleague Dominique Bergevin, then download EDC’s (whitepaper download) Managing Foreign Exchange Risk with EDC Guarantees and EDC’s guide to Building a Foreign Exchange Policy.

Have you ever had your bottom line diminished because of fluctuating exchange rates? What steps did you take to diminish your future risk?

The question then becomes: how do you get the cash that will allow you to continue to grow your exports? Here are several common answers:

1. Obtain a larger operating line from your bank.

This could simply be an increase to your existing general line. Or it might be a new line tied to a single contract or to multiple contracts, perhaps secured by the value of your product inventory or work-in-progress. Depending on your bank’s estimate of your borrowing capacity and the value of your security, this could be the most straightforward solution.

2. Margin your foreign receivables.

Your bank may already be margining your domestic receivables, so why wouldn’t it do the same for your foreign ones? Answer: It may, although many banks are reluctant to do this because foreign deals have a higher risk of non-payment.

3. Margin your foreign inventory.

If you have inventory offshore, you may be able to borrow against a percentage of its value. But again, your bank may be uneasy about issuing credit against overseas assets because of the higher risk involved in doing so.

4. Margin your R&D credits.

If you have an R&D department and get tax credits for its expenditures, you can ask your bank to margin against these credits. However, some banks consider this too risky.

5. Obtain a capital expenditures loan.

If you need to make capital investments in your company—to expand your Canadian production facilities to meet new demand, for example—you might approach your bank for this type of financing. If the amount is within your borrowing capacity, you’re probably good to go.

6. Obtain a loan to finance a foreign acquisition.

Suppose you decide to enter a foreign market by purchasing an asset there. You’ll probably want your bank to help finance the deal. This can work if you have enough borrowing capacity and/or if your bank will accept the offshore asset as security.

You can see the pattern here. You may get the working capital you need if you have enough unused borrowing capacity, or if you can provide security your bank will allow. But suppose you need more credit than your bank is willing to issue, no matter what you offer? This can happen even if you’ve never been refused additional credit before, and even if your foreign business is doing well. It all comes down to the level of risk your bank is willing to accept. So if the bank says “Sorry, no,” have you hit a wall?

Not necessarily. Many Canadian exporters have found themselves in this situation, and discovered a solution that worked for both them and their banks—the Export Guarantee Program (EGP) from Export Development Canada (EDC).

7. Explore the Export Guarantee Program from EDC.

Under the EGP program, EDC can issue a guarantee to cover the financing you require, and this can give your bank the confidence it needs to extend more working capital for your operations abroad. And because the EGP is so flexible, it can support many different financing scenarios—including the six we’ve just looked at.

An EGP guarantee can be instrumental in turning a potential deal into a real one.

This was the experience of FourQuest Energy, an Edmonton-based services firm that provides the oil and gas industries with pre-commissioning, commissioning and maintenance services for facilities such as refineries.

“In 2010, we were pursuing our first international project, which was to pre-commission a refinery in Kazakhstan,” says company President Nik Grgic. “The contract’s value was large and comparable to our entire annual revenue at the time, so we needed a loan to buy the equipment for the job. What made the loan possible was EDC’s Export Guarantee Program—without the guarantee the program provided, we never could have raised enough money to do the project.”

So if your company has export-related activities or foreign investments, and needs more working capital to grow, be sure to take a look at the EGP.

Ever experienced challenges in scaling your business because you didn’t have enough working capital? How did you overcome those challenges? Share your experience and comments with the community!

Any good contract protects you and your customer when you do business together. But when you start selling abroad, you have to think about your sales agreements in a different way. In this post, we’ll look at six strategies for writing solid contracts that will help you avoid problems with foreign customers and governments.

1. Get the language right

Make sure you and your customer agree on the language to be used in the contract and on the meaning of each clause. If the contract is in English, but your customer wants a native-language translation, both contracts must specify which version has legal precedence. If the non-English version is to take precedence, have your legal counsel verify that the intent of the translated contract agrees exactly with the intent of the English one. If there’s a dispute, you don’t want your customer to claim that a clause wasn’t properly translated.

2. Check for compliance with laws and taxes

You’ll be asking for trouble if you don’t have your contract reviewed by legal counsel familiar with local laws and taxes. For example, suppose you send personnel abroad to install products you’ve sold to a foreign customer.

Because you’re working in the customer’s country but your firm is non-resident there, you could get hit with large, unexpected taxes when it’s time to get paid.

So be sure to get competent advice on local tax laws before you finalize your contract, and include clauses that will protect you. The same applies to laws and regulations related to things like customs clearance, labour codes and technical standards.

3. Don’t litigate—arbitrate

If you get into a serious disagreement with a foreign buyer, do your utmost to avoid litigation in a local court, since this will usually put you at a severe legal disadvantage.

You’ll be much safer if your contract specifies that any disputes will be sorted out through arbitration.

Your contract should also state that arbitration will take place in a neutral country. This is to ensure that the arbitrators won’t be swayed by local interests.

4. Don’t deliver to the door

In most overseas markets, you should deliver your goods only to the port of entry and no farther. If you agree to move them within the buyer’s country, you’ll be at the mercy of unfamiliar and possibly unreliable logistics systems, and will be responsible for damaged goods or late delivery. In addition, your customer should accept full responsibility for getting your goods across the border, including dealing with customs, obtaining import licences and paying all taxes and duties.

5. Nail down “acceptance”

In any sale where customer acceptance—and thus payment—depends on the product’s specifications or performance, put a “deemed acceptance” clause into your contract. This should tie the acceptance of the goods to specific conditions or events, never to something as vague as “customer satisfaction.” That kind of ambiguous wording can give some buyers an excuse to keep you dangling because they’re not “satisfied.”

6. Protect yourself from contract risks

What if a customer cancels your contract without just cause? Or a buyer goes bankrupt? Or your key import permits are revoked? To protect yourself from risks like these, you can use insurance solutions from Export Development Canada (EDC). EDC’s solutions can cover all these hazards and more, from a customer’s refusal to accept your goods to a political upheaval in your foreign market. The bottom line: with the right EDC insurance in place, you’ll get paid even if your customer doesn’t come though.

Want to learn more about managing contract risk? Visit EDC’s website to download your copy of ABCs of International Contracts and watch a video with me and my EDC colleague, Dominique Bergevin. We also have a webinar coming up on May 6, so be sure to register today.