Australian small and medium enterprise exporters have three things in common – they are creative, confident and optimistic.
So it is no wonder they are often counted among Australia's best companies.
Despite this, they often face significant challenges accessing the finance they need to fund their exports, an issue that is raised with us regularly by many that we speak to.
This is especially the case with smaller exporters, which often don't have the collateral available to secure finance from their bank, forcing them to rely on family, friends or credit cards to grow their business.
Recent amendments to how Efic, Australia's export credit agency, can support Australian exporters will improve this situation.
Smaller businesses are a significant contributor to the Australian economy, accounting for over 70 per cent of the Australian workforce and 60 per cent of Australia's total income.
In response to these amendments, we've introduced the Export Contract Loan, a flexible loan product with a streamlined application and approval process that makes it easier for SME exporters, and those in export supply chains, to access the finance they need when their bank is unable to assist.
Over the past two years we've been able to reduce the average turnaround time for our other products by 75 days, with this new product potentially saving every small business that applies up to $10,000 and two months in processing time.
Two clients have already benefited from our new export contract loan, only a matter of days after it was launched.
One of these businesses was Steele Environment Solutions, a Victorian technology advisory and research firm, which needed additional working capital to fulfil two significant export contracts to UK-based companies.
The first of these contracts requires Steele designing a waste treatment process to clean up toxic and hazardous waste storage sites, while the second involves creating an 'at scale' demonstration of Steele's chemical process technology for treating and packaging toxic and hazardous wastes.
Once Steele has designed these waste treatment processes, it has a strong chance of securing a significant pipeline of supply contracts in the UK and the US.
While Steele's bank was supportive of these contracts, it required further tangible security before it would approve the additional funding needed to meet the significant upfront material and labour costs.
This lack of tangible security, such as 'bricks and mortar' collateral or inventory, is something that holds many exporters back from being able to fulfil important contracts.
This is especially the case where an exporter's major asset is intellectual property, something banks often find difficult to value and lend against.
Fortunately, Efic was able to support Steele with a $300,000 export contract loan, allowing Steele to pay these upfront costs and fulfil this high profile research and development contract.
The success of innovative companies like Steele highlights the opportunities that are available for Australian exporters to grow on the global stage.
Australia's smaller businesses have a bright future and we're looking forward to helping them to pursue the export opportunities that will play a vital role in Australia's future growth.
*Andrew Watson is the executive director, SME at Efic