Tying trade finance into the logistics supply chain

Providing financial support
for global trade is fast
becoming the norm in a
world of continued economic
uncertainty.
According to some estimates,
up to 90% of world trade
nowadays relies on one or more
trade finance tool.
“The world economic outlook
remains bleak and cash is
king. Even large international
companies are opting to
use trade finance,” Clifford
Blackburn, CEO of TSI Central
Station, told FTW.
In his view, a variety of
reasons exist for this, including
the need to know what the cost
per item is.
“There is also a bigger need
to pay in local currency,” he
explained. “There is a lot to be
said about predictive logistics,
mostly taking the volatility out
of the supply chain – and trade
finance certainly does this.”
He said predictions were that
big bankers
would be
trying harder
to capture this
market in 2017.
“They do,
however,
have a certain
disadvantage
by only being
financiers,
unlike other
solutions
available to
industry such
as Bluestrata which is now
Investec Import Solutions
(IIS).”
According to Blackburn
the big challenge is making a
wise decision as to which trade
finance provider to use.
“ISS has introduced some
real innovation to the market
place
combining
trade finance
with total
logistics. From
an African
logistics
viewpoint
innovation
is hugely
important
– as is
understanding
the type of
funding.”
For Blackburn the future lies
in total innovative intelligent
predictive logistics.
“I know that is a mouthful
but if you take it apart then
innovative as trade finance
ties into your logistics supply
chain, managing the when how
and what. Intelligent is
never over-ordering
or under-ordering,
never over-spending
on your stock (this
is where companies
can get into financial
problems, too much
stock on the floor) or
running out of stock,”
he explained. “We refer
to the trade financers as
bean counters; they are
effectively banks
and ensure that the
right people are
paid at the right
time. Predictive is
the operative
word; you
need to have
someone that looks after you
from cradle to grave or at least
looks after the various service
providers – and this is
the game changer.”
INSERT & CAPTION
The future lies in
total innovative
intelligent predictive
logistics.
– Clifford Blackburn