By Investec For Business Head of Portfolio Management Greg Cline

We are starting to see an uptick in the economic cycle where interest rates are reducing, the two-pot system should increase consumer spend, fuel prices are coming down, and the GNU seems to have sparked a renewed optimism for accelerated reform. This renewed focus on energy and logistics coupled with regulatory changes aimed at attracting private sector investment, bodes well for the broader trade, imports and logistics sector. However, the need to improve operational processes and manage costs continues to be an imperative for companies, especially those looking to adopt a more efficient, sustainable and diversified approach to their import operations. 

Keeping abreast of industry movements and trends in the imports space and understanding how to optimise supply chain fulfilment continues to be critical for business growth. While trade forecasts for early 2025 are expected to be slow, especially post the US elections with economic movements and possible import tariff changes, a boom for the latter half of the year is expected. Major tariff and import changes could potentially lead to higher prices.

Having the expertise and access to capital coupled with import solution providers to assist in managing these market challenges, allows for greater risk management around external factors, especially when future development plans rely on capital injections.  

In fact, working with a finance partner where forex, logistics and trade finance are on one platform enables importers to manage their working capital better. While supply chain disruptions are still on-going, foreign based suppliers do not always adhere to the procurement schedule. This creates demand spikes in the working capital cycle and has the knock-on effect of extended sales days to realise debtors. In these instances, the ability to manage supply chain efficiencies through production tracking, understanding how best to negotiate payment terms on erratic ship-ments, and having direct control over forex hedging strategies is key to smoothing over working capital needs and preserving margins. 

Businesses always have the pressure to effectively execute their strategies to capitalise on opportunities and so it is no wonder that so many turn to import partners to help them use their working capital where it is needed most and plan, pre-empt and mitigate as far as possible – giving them the headroom to grow.