A Study of the Taiwanese Machinery Manufacturers Utilize Financial Facilities to Avoid Trade Risk in Emerging Markets

• Main Authors: Meng-Ju Chen, 陳孟如
• Other Authors: Chintan Huang
• Format: Others
• Language: zh-TW
• Published: 2015
• Online Access: http://ndltd.ncl.edu.tw/handle/07963218077361744790

碩士 === 銘傳大學 === 管理學院高階經理碩士學程 === 103 === Looking at the changes in international trade payment methods, cross-service transaction on credit has become the mainstream of the condition of international trade transactions. However, the trade for machinery product is different from the ordinary consumer product’s trading. Its’ goods category is capital goods. In general, the pricing for capital goods is relatively high, in addition to a longer payment period, the payment terms are often amortized. The niche market for machinery product is mainly in the emerging countries, therefore, utilizing proper financial facilities to avoid trade risk is the primary factor to achieve a business deal effectively. This study was designed to investigate how do Taiwanese machinery equipment and machine tool manufacturers utilize export specialized bank’s financial facilities which are deferred payment LC and export credit insurance to avoid trade risk and expand export in the emerging markets. In this paper, mining survey and in-depth interview for the machinery industry were used. Also, we used descriptive statistics and analysis of variance. The results found that approximate forty percent of companies are willing to accept the credit term period 180-360 days or less. While more than one year or longer term on credit transactions, vendors accept possibilities are generally not high. In consequence, credit terms of one year or less is within vendors’ acceptable range. About seventy to ninety percent manufacturers believe the long-term export credit insurance and long-term low-interest loans provided by the export specialized bank could be helpful to their transaction. Furthermore, using analysis of variance, we then verified that long-term export credit and export credit insurance have an impact on their exports and trading areas, regardless of they are machinery equipment manufacturers or machine tool manufacturers. In addition, using in-depth interviews with manufacturers of machinery, we found a high risk trade for machinery and equipment exports to Eastern Europe, Southeast Asia, Central and South America, the Middle East or Africa, the manufactures would better facilitate long-term financing and export credit insurance to avoid political and credit risk of the buyers. As a whole, their account receivables would be duly secured by utilizing these financial facilities, hence, they can expand trading territory in the emerging markets.