BCB International Protective Equipment
Survival and protective equipment manufacturer BCB International Ltd has become one of the first Welsh smaller and medium sized exporters to use government cash to secure two export contracts worth US$500, 000.
The Cardiff-based company, which designs and manufactures a wide range of equipment for military forces including hand tools, clothing and body armour, turned to UK Export Finance (UKEF) after it was commissioned to supply life-saving protective equipment to the Ecuadorian Navy.
Although BCB negotiated full payment in advance of the shipment, the Ecuadorian Navy required a bank guarantee to be issued to safeguard the funds – without this, the deal would not have gone through.
UKEF, the UK’s Export Credit Agency, provided a government guarantee to their bank through its Bond Support Scheme, covering 80% of the facility provided. This enabled $400, 000 to be issued for the two contracts.
Mathew Hughes, UKEF Export Finance Adviser for Wales, explained: “We were eager to help BCB International because it is an innovative Welsh company looking to take new products around the world.
“In particular BCB is looking to emerging markets for growth. This fits well with UKEF’s capability to help mitigate the financial risks inherent in trading with those more challenging markets, both in terms of potential delays to payments or even not getting paid at all. Such difficulties can cause enormous disruption to a company’s cash flow.”
Andy Howell, managing director at BCB International, commented: “We found that UKEF’s products were a perfect fit for our needs. Getting the orders is only half the battle. Paying guarantees can hamper growth, but the export markets are where the growth is, so companies should seek help from UKEF as soon as possible.”
UKEF is committed to playing a key role in the UK’s export-led economic recovery by forging strong partnerships and collaborations with exporters, trade associations and the financial sector, including banks. The aim is to ensure its services and capabilities reach the widest possible market.
Mathew Hughes added: “There were benefits all-round here. The bank had a much stronger client having backed the deal and found the right support. The exporter increased its turnover and profitability, moved into a new market, and will have the confidence to do so again in future. And from a UK government perspective, we have taken a positive step to reducing the country’s trade deficit. So our support ticks the boxes for all three parties involved, and I’d strongly encourage more Welsh exporters to take advantage of it.
During the last three years, UKEF has developed two key products designed to help banks support customers needing to finance export orders. These consist of a range of financial guarantees for banks looking to extend lending facilities and short-term credit insurance for export orders to markets.
For further information on UK Export Finance and its support schemes, please visit www.gov.uk/uk-export-finance, or contact our national customer service helpline 020 7271 8010 or emailcustomer.service@ukef.gsi.gov.
Issued on behalf of UK Export Finance by Quest Public Relations Ltd. Media contacts are Sharon Cain or Carol Arthur on 01423 564192 sharon@quest-pr.com or carol.arthur@quest-pr.com.
UK Export Finance is a Government Department and is the UK’s Export Credit Agency. It complements the private market by providing assistance to UK businesses, principally in the form of insurance to exporters and guarantees to banks. In doing so, it works with exporters, banks and project sponsors to support UK exports to, and investments in, markets across the world.
In 2012/13, the agency provided UK business with £4.3 billion of support. Over the past two years, since it re-introduced short-term products (under 2 years maturity) its Trade Finance and Insurance Solutions team has helped, or committed to help, over 100 companies – many of them smaller and mid-sized businesses – to fulfil export contracts worth over £800m. In many cases, delivered via risk sharing with the banks, this support has enabled firms to reduce their level of risk without restricting their cash flow, increase their working capital facilities and, in some instances, significantly increase their turnover.
The Prime Minister launched the government’s ‘Exporting for Growth’ challenge last year and the government has now set an ambitious goal to increase exports to £1 trillion per annum by 2020.
