Exporting from Australia: the money side before the first shipment

Most export advice begins with markets: where to sell, who to approach, how to adapt a product. That matters, but the owners who get hurt are rarely the ones who picked the wrong country. They are the ones who shipped a container and waited 75 days to be paid.

This guide starts from the other end. It treats an export order as a cash flow event and walks through the finance decisions in the order they come up. Availability of programs changes, so check each official source before relying on a figure.

What does an export order do to your cash flow?

Picture the timeline of a typical order for goods.

1. You agree a price with the overseas buyer.
2. You buy materials or stock and pay wages to make the product.
3. You pay for packing, freight, insurance and any certification.
4. The goods ship, and the buyer receives them weeks later.
5. The buyer pays, on whatever terms you agreed.

Between step 2 and step 5, you are out of pocket. For a manufacturer with a four-week production run, three weeks of sea freight and 60-day payment terms, the gap can easily be four months. If the order is large compared with your normal turnover, the gap is bigger than your usual working capital.

A useful exercise before accepting any order is to sketch the weekly cash balance for the full period. Our cash flow gap calculator is built for it. What you are looking for is the lowest point, and how much money you need to survive it.

How should I get paid?

Payment terms decide who carries the risk, and they come before price in the negotiation.

Method	Who carries the risk	When it suits
Payment in advance	The buyer	New buyers, custom or low-volume goods
Deposit plus balance before shipping	Shared	Made-to-order goods, a good compromise
Documentary letter of credit	Largely the banks, if documents comply	First orders, larger values, riskier countries
Open account (30, 60 or 90 days)	You	Established buyers with a track record

For a first order with a buyer you haven’t met in person, avoid open account. A deposit that covers your direct costs means a failed order doesn’t sink the business. If the buyer insists on open terms, ask for credit insurance or a bank guarantee, and see whether invoice finance or trade finance lets you draw on the invoice once the goods ship.

Letters of credit are paperwork-heavy. A small discrepancy between the documents and the credit terms (a misspelt name, a late shipping date) can let a bank refuse payment. If you use one, check the terms with your bank before you produce the goods, not after.

What government support exists for exporters?

Three sources are worth knowing, and each does something different.

Export Finance Australia (EFA). EFA is a government-owned export credit agency. According to business.gov.au, it gives eligible exporters, or businesses in an export supply chain, a guarantee that is provided to your bank as security so the bank can approve export-related finance. The published eligibility includes annual turnover above $250,000, at least two years’ trading, an ACN, a valid export contract or a role in an export supply chain, and being unable to secure the full amount of bank finance without extra support. Guarantee amounts start at $350,000. Other listings and bank pages have shown different minimums over time, so confirm the current figure with EFA.

Export Market Development Grants (EMDG). Run by Austrade, EMDG reimburses part of eligible expenses on promoting your products overseas. It is matched funding: you must spend your own money on eligible activities, and the grant covers a portion. The current round’s grant agreements cover planned spending in 2025-26 and 2026-27 and funds are allocated in the order applications arrive, so check Austrade for the status before you plan around it.

Austrade’s advisory services. Beyond grants, Austrade helps with market information and introductions. It doesn’t lend, but it can help you decide where not to go.

Our general guide to government grants for small business covers broader schemes. Remember that grants reimburse spending, so they rarely fix a cash gap in time.

What are the tax and compliance basics?

You don’t need to become a customs expert, but a few points save money.

• GST. Goods you export are generally GST-free if you meet the conditions and keep evidence of export. You still report the sale on your BAS, and you can claim credits on GST in your costs, so a business that mainly exports can find itself owed GST refunds regularly. That’s a cash flow advantage worth planning for.
• ABN and registration. You need an ABN. Depending on the goods, you may need to register or use a customs broker. The Australian Border Force explains when.
• Permits. Food, agricultural, wildlife, defence and cultural goods each have their own approvals. Find out before production, not before shipping.
• Rules in the buyer’s country. Import duties, standards and labelling in the destination can change your price or block entry. Your buyer or freight forwarder can tell you.

Incoterms, the standard shorthand such as FOB or CIF, tell both sides who pays for freight and insurance and when risk passes. Agree them in writing, because they change your costs and the point at which a lost container becomes your problem.

How do I manage currency risk?

If you invoice in a foreign currency, the amount you receive in local money depends on the exchange rate on the day you convert. A move of 5 per cent can erase a margin.

Practical choices:

• Quote in a way you can manage. Invoicing in your own currency moves the risk to the buyer, who may push back. Invoicing in their currency makes the sale easier but leaves you exposed.
• Forward contracts. Banks and foreign exchange providers can lock a rate for a future date, which fixes the amount you will receive. You give up any upside.
• Natural hedges. If you pay suppliers in the same currency, your costs and receipts offset each other.
• Build in a margin. Price in some slack for movement if you can’t hedge.

Ask your bank what is available and what it costs in dollars. Our guide to trade finance for importers covers the same instruments from the buyer’s side and is worth skimming to see how the other end of the transaction sees it.

A worked example

An invented scenario. A Hobart producer of premium honey and skincare receives an order for $120k of product from a distributor in Singapore. Production and packaging costs are $68k, freight and insurance $6k, and the distributor wants payment 60 days after delivery. Shipping takes about three weeks.

The cash picture: the owner spends about $74k up front, and gets paid about 12 weeks after shipping starts. Their usual account holds $25k.

The options they weigh:

• Ask for a 30 per cent deposit. That is $36k, which covers half of the outlay. The buyer agrees to 20 per cent, $24k.
• Use a bank trade facility backed by the purchase order, to fund the remaining $50k, repaid when the buyer pays.
• Seek EFA support. The business turns over under $250,000 a year, so it doesn’t meet the published threshold. It moves on.
• Use a short-term working capital loan as a backstop if the bank is slow.

The owner takes the 20 per cent deposit, a modest trade facility from their bank, and quotes the balance in local currency so there’s no exchange exposure. The total cost of funding is a few thousand dollars, and the order earns around $40k.

The point isn’t the numbers. It’s that the plan was made before production, not after.

When should an exporter look beyond the bank?

Banks are often the cheapest and best-informed source of trade finance, particularly where they know your business. A bank that understands exports and has seen your history is worth asking first.

But banks work to criteria. If you’re newly established, the order is large compared with your size, the buyer is in an unusual market, or you’ve been declined, other routes exist. See export finance for how it works, how to fund a large order for orders beyond your normal limit, and how invoice finance works for funding receivables once you’ve shipped. The page on importers and exporters pulls these threads together by industry. If you’d like a view of your own situation, you can tell us about the order.

Turning an export order into funded reality

An export order is a good problem to have, as long as you can fund the gap and the payment terms don’t put the business at risk.

Our enquiry takes about a minute, and your credit file isn’t touched when you submit it. We don’t pass your details around to a stack of lenders. A real person reads your situation, including the order size, timing and payment terms, then phones you to talk about what might fit. Fill in the form as accurately as you can, since the right structure depends on the specifics.

Get your export order funded →