Marketing fresh fruits and vegetables is a great business opportunity, especially when the product is sent to a market with greater purchasing power, however, it also involves a series of risks that can become a real pain to any grower or agro-exporter.
The money generated after the sale of the products is necessary for growers to be able to carry out the following season, especially if their economic solvency is not very high. Therefore, remaining for a long time without this money could be very dangerous, interrupting their operations or even representing economic losses.
This lack of cash is something recurrent within the industry, as buyers are often slow to pay for the products they receive. This is where financing comes in, which plays an important role in providing producers with the cash they need so that their operations are not interrupted while they receive their payments.
However, while financing can help to provide a possible solution to these problems, it is necessary to have financing according to the needs and the type of product being marketed, something that is not very common in agriculture.
Buyers take too long to pay?
One issue that is a constant concern for any grower or agro-exporter is the matter of payment, since it is very common that, once the fresh produce is shipped to its respective buyer, the corresponding payment is made within weeks or even months.
This represents a clear advantage for the buyer, as he can start marketing the product without getting decapitalized. On the other hand, the seller must continue with his operations without having the money due for his product, forcing him to look for alternatives within his possibilities, which are generally limited.
Is cash flow low?
As we know, in agriculture, activities do not end with the sale of the product, but rather it is a constant cycle in which farmers need to continue their operations. Therefore, while marketing the product, they must also take care of the operation and preparation for the following season.
In this sense, the need for liquidity is of utmost importance during all stages of production, especially during the harvest, since this is where more labor is required, in addition to machinery, the purchase of inputs, and other expenses that growers must amortize.
Thus, if the buyer takes too long to pay, as is usually the case, the grower risks running out of cash flow and will not be able to carry out the activities necessary to continue his operation.
Financing does not suit the business?
When facing cash flow problems, growers seek to obtain this money in different ways, financing services being one of the most frequently resorted options.
However, far from representing a simple solution, traditional financing can cause even more problems, since they are often not the best option to meet agricultural needs.
In addition, these may involve difficult procedures or requesting guarantees, without taking into account that the process and delivery of financing tends to take a long time, which may not be convenient for the grower if the time is similar to the buyers’ payment terms.
Quick-Pay, the ideal factoring for agriculture
In response to these problems, ProducePay offers Quick-Pay, a factoring service that suits your needs as a grower or agro-exporter and helps you avoid the risks of long payment terms and lack of cash flow.
That is why, through Quick-Pay factoring, you can receive up to 96% of the value of your shipment within 24 hours after your buyer confirms receipt of your product.
This not only allows you to have immediate and secure access to your money to cover the necessary expenses and continue with your operation, but it is also an easy and fast processing service.
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