How can you avoid overexposure in a competitive, fast-paced industry?
Get A Trade Credit Insurance Quote
Our international team of trade experts is here to help. Contact us to learn more about our coverage options for the Food and Agriculture Industry or request a free, no obligation quote that includes credit reports for your largest trade partners.
Food and Agriculture Industry
With challenging business conditions post COVID-19 and ever-shifting consumer preferences, it’s all too easy for food and agricultural businesses to become vulnerable to non-payment and financial risk before a problem is evident. At the start of 2022, with inflation and a dwindling labor force, the trade credit assessment for the U.S. food sector is fair to good in comparison to the world economy. Food will continue to be a necessity and consumer demand will always be high; however, competition in this sector is also very high.
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Atradius is here to help. Contact us to learn more about our coverage options or request a free, no obligation quote that includes credit reports for your largest trade partners.
A high-competition industry means many food and agricultural businesses feel pressured to offer extremely competitive terms to buyers, exposing them to excess risk. Suppliers can turn away the sale or lose to the competition, if they are not comfortable offering increased credit limits or extending terms.
Food businesses continue to be impacted by the COVID-19 pandemic. The start of 2022 has introduced a turning point as most of the world is on the road to recovery, however, the emergence of any new, highly transmissible variants poses risk to business stability. The food industry, specifically services and restaurants, fall particularly vulnerable due to the potential for lockdowns and the ‘great resignation’ of skilled workers.
Consumer habits are always changing, and food businesses must keep up or risk becoming obsolete. Especially for smaller businesses, staying aware of changing trends and responding accordingly can be burdensome. Consumers are increasingly demanding full transparency. Distrust in the food industry has increased the need for food and drink manufacturers to be more transparent about their ingredients, production processses, and supply chains.
Atradius’ easy to use website and quick response has made it possible for us to qualify new buyers with a minimal amount of effort. This has been a big boost to our business.
Benefits to Credit Insurance
Trade credit insurance is a risk management tool that can help protect your company’s commercial accounts receivable from the devastating effects of loss caused by a bankruptcy or protracted default of your buyers. No company wants to face the unknown. At Atradius, we give our clients peace of mind knowing that their policy protects them from a customer’s sudden inability to pay. Especially in an industry that must adhere to high-cost environmental regulations, trade credit insurance can help with cash flow and to ensure companies are financially stable.
Atradius analyzes industry trends and the risk of every buyer to ensure you are working with stable customers. If a previously reliable customer starts showing signs of deteriorating payment trends, we alert you right away so you can take steps to insure and protect your accounts receivable. We evaluate the supply chain and your trading partners from each angle and can alert you to trouble coming down the pipeline before there is a loss. And if a loss does occur, having a trade credit insurance policy means your business doesn’t have to take the full hit.
Companies in the midst of a growth phase may need to put up accounts receivable as capital to receive additional funds from a bank. Having a trade credit policy with Atradius that mitigates your risk means banks are more comfortable loaning the funds you need. Securing receivables with a trade credit insurance policy allows you to leverage your borrowing base and increases your access to working capital. This often includes the ability to borrow against foreign receivables previously excluded by the lender.
For companies seeking to safely grow sales, working capital is essential. If your company doesn’t feel comfortable increasing existing credit lines or initiating credit lines in new markets, we can help. We are a global company with a presence on every continent. Our innovative services provide you with the practical tools you need to manage your receivables, building the foundation for solid business growth and success. Trade credit Insurance allows suppliers to remain competitive offering terms with peace of mind that they are protected in the event of bankruptcy – helping you remain competitive and grow sales while transferring much of the risk.
Our policies are cost effective. On average, the rate we charge falls to less than one half of 1% of sales. If a company sets aside a debt reserve of 5%, our services are extremely cost effective, because with our accounts receivable coverage you will get the majority of any lost money back.
Get Your Questions Answered or Request a Quote
Atradius is here to help. Contact us to learn more about our coverage options or request a free, no obligation quote that includes credit reports for your largest trade partners.