International investments

Starting in 2002, directors Uwe Backes and Stephane Thomas spent a year perfecting and patenting their product, a stylish new take on the old spirit stove, going through 12 prototypes in the process. Their focus was on developing a completely safe, high quality product that would have no peers in the marketplace.

Their break came in early 2004, when participation in the prestigious Australian Design Awards generated international publicity. Soon after, the EcoSmart Fire was featured on The New Inventors television program. Unlike most of the inventors on the show, they already had a product that was ready to go, with patents, trademarks, logos and a marketing plan. Interested resellers started calling as soon as the program finished, and their business was launched onto the Australian market.

International success followed with a US distributor and soon the EcoSmart Fire was on sale in 45 countries around the world. The company doubled turnover from $5m to $10m in the 2007–08 financial year, and expects to double it again this year. But that export success didn’t come without careful planning.

Funding this expansion required the right financing. “If you don’t look after your finance it will really slow down your growth,” says Uwe Backes.

While the company started off funding growth by reinvesting sales revenue, they’ve recently taken out an Insured Export Finance facility. That means they can access 81% of the value of an invoice as soon as it’s issued, secure in the knowledge that they are insured against any bad debts. That allows them to offer more generous terms to their network of distributors.

“We’ve got the Commonwealth Bank as our partner”, says Backes. “We needed outside finance because we are growing so much and also because you want to give your network a bit more relief.”

“Now through the Commonwealth Bank we have all of our customers insured worldwide. It means we will never have any bad debt, which is important with this kind of turnover.”

Backes advises, “Make sure you have your finance in place before you go out into these markets and do your research.”