4 Amazing advantages a trader gets after availing upto 120 days of credit for his freight shipment
We live in an era of developed and well-functioning money markets that provide us various credit options like personal loans, credit cards, etc. This has not only uplifted the market conditions but has also enabled the common people to fulfil their wishes easily. Have you ever wondered how helpful it would be for all the traders if this kind of credit facility is provided in the global shipping industry? Well, if you have then it would be amusing to know that the leading shipping companies are providing limited days of credit through which you can easily ship your consignment without having to pay for it immediately. The number of credit days that you select for your freight shipment will allow you to put your payment on hold for that period of time. Although there are only a few shipping companies that are providing this offer, the maximum number of credit days that they are offering is limited to 60 days. It is only Cogoport that is providing 120 days of credit to all their clients at a very minimum service rate.
Cogoport charges no interest for 30 days of credit, 0.5% interest for 60 days, 1% for 90 days and only 1.5% for 120 days of credit by presently becoming the only shipping company to do so. There are also no hidden charges or any penalty on prepayment of the bill. The 4 amazing advantages that a trader gets after availing this facility are mentioned below.
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Maintaining a healthy cash flow
A trader usually receives payment of freight shipment only after the consignment is reached safely at its destination as per the agreement rules. This creates a difficult situation as most of the time he may run out of petty cash which can affect the payment cycle. Therefore, by availing credit days a trader can utilise the cash in hand easily and then make the freight shipment charge after the bill is cleared by your consignee. This helps in maintaining a healthy cash flow.
Channelising capital efficiently
Big consignments can drain a trader out of money for a while which can put his or his company’s other productive tasks on standby. The 120 days of credit facility would allow the trader to ship consignment as well as use the available capital in doing more productive tasks. In this way, he can channelise the capital efficiently without having to worry about cash availability.
Working on multiple consignments
A lot of traders have to put shipping consignments on hold because they are unable to finance all of them at once. This problem can also be solved as you can avail credit days and manage the payment of consignments for which the trader does not have immediate funds. The shipping company pays on his behalf and he can pay it back within the predefined period of time.
Coping up with losses
Trading business is full of uncertainties and one may incur unexpected losses in any financial year which can further affect his following lined up freight shipments. The 120 days of credit facility can help in coping up with this problem as the trader’s work will not be put on hold because of the lack of funds. So, one can repay the company after his due bills get cleared.
Limited period of credit facility at such reasonable interest rates can definitely boost the productivity of a trading firm. Unavailability of funds is the main reason why a lot of traders have to pass on good and profitable consignments to other traders which affects their own business. You, as a trader, should not make the same mistake as you have the opportunity of availing the credit days and financing your shipments.