Flexible solutions help eliminate forex risks

Clearing and forwarding arm provides all-in package
KEVIN MAYHEW
THE ABILITY of companies to take advantage of global marketplace opportunities and grow their business is often thwarted by cash flow problems, but these can be overcome by access to trade finance for imports and exports, according to the managing director of Alexander Fraser & Son, Mark Ferguson.
The company is an independent, private and locally owned specialist trade finance company with a complementary clearing and forwarding subsidiary, The South African Mercantile Corporation (SAMC).
Ferguson says Alexander Fraser can provide a separate facility from an overdraft to specifically finance a company’s imports or exports, thereby allowing the company to use its overdraft for the day-to-day running of the business.
“Windows of opportunity can be missed by not being able to act swiftly and, in many cases, the restriction is availability of finance,” he explained.
Alexander Fraser – which has had a presence in South Africa for 75 years – has streamlined its decision processes to provide a speedy turnaround time for approving new clients. Management is hands-on by senior executives, and continuity of management ensures a continuing, secure and personal relationship with their clients, many of whom have been clients for many years, says Ferguson.
“We advise our clients not only on their trade finance but have expertise in customs clearing and forwarding as well, so enabling us to advise them on the whole logistics chain, from start to finish.”
The company also has offices in Johannesburg and Durban as well as a sister company in the UK which trades under the same name.
“Although we are focused on providing small to medium sized companies with trade finance, most of our clients are owner operated and grow to be significant operators,” he adds.
“Facilities are structured as simply as possible, providing each client with the most appropriate and flexible finance, free of any restrictive covenants that could effect availability and usage.”
Services include paying for goods locally or internationally in any currency, directly or by letter of credit, and drawing a commercial bill payable on a fixed date (up to 180 days from dispatch) in local currency that includes all costs. This provides clients with fixed landed costs well in advance of receipt of goods, which eliminates foreign exchange risk. This process also provides sufficient time for goods to be shipped, received, sold and paid for before the commitment under the commercial bill is to be met.