Getting paid is often the hardest part of your international trade transaction. Even if you are used to taking payment up-front in your domestic market, you will find that much harder in an overseas market.
When you make a capital investment, whether in equipment for your existing business or by investing in another business, you do so because you expect to generate income in the future. If this were not the case, you would not make the investment.
International trade is the exchange of goods or services for money between countries; foreign direct investment is investment by a business in another country for the purpose of trade, which could be domestic or international. However, there are many ways in which you can ‘internationalise’ your business.
This note is intended primarily for businesses that are seeking external finance. A business plan for use internally will tend to be more of a checklist of actions but a plan for a funder needs to explain the business in enough detail to reassure them that they will eventually get back their investment and make a return. A business plan can be prepared for the whole organisation or for a division or even just for a single service.
This note has been prepared to assist you to think about the risks that you might face when engaging in international trade or investment. Whilst some of the risks may apply more broadly, this fact sheet does not attempt to cover all aspects of business risk.