Learn how one cool, small, minority-owned business customer uses export credit insurance to expand into new markets, protect the environment, and maintain market share in the highly competitive auto aftermarket.
Background
Based in Doral, Florida, Freezetone® Products Inc. is a small, minority-owned business that carved out a market niche in the crowded auto aftermarket.
The company was established 1978 when many vehicle owners used ordinary tap water as engine coolant. Mr. Luis M. Latour, President of Freezetone®, had the vision of creating environmentally safe engine coolants while conserving one of our planets most precious resources - fresh water. Our world is seventy percent covered by water but less than three percent of that is fresh, and only one percent is easily accessible, according to National Geographic.
Mr. Latour built upon his 30 years of experience in manufacturing eco-friendly products for the automotive industry to develop a non-toxic, environmentally friendly alternative to tap water.
The Challenge
How do you convince someone to stop using an inexpensive solution and start using a more expensive one? You start by letting them know they can save more money and feel good about protecting the environment.
The marketing challenge was also a business challenge. Freezetone® needed to differentiate their product while making a profit in the already crowded U.S. engine coolant auto-aftermarket segment. Freezetone® tackled the problem by choosing to:
• Educate customers on the detrimental effects of corrosion and oxidation on metal engine parts when using water as a coolant. They let customers know that the engine damage and associated costs are the same whether using distilled, purified, or demineralized water.
• Convince customers around the world that protecting their vehicles with Freezetone® products also allows them to be environmentally conscious.
• Continue to grow the business aggressively by marketing the Freezetone® brand internationally while staying competitive by offering extended payment terms to distributors.
The Solution
Freezetone® first approached EXIM Bank in 2010 to match credit terms with the competition. EXIM's export credit insurance provides the company nonpayment protection in risky markets where coverage is often limited or unavailable. Freezetone® worked closely with EXIM Regional Director, Jennifer Simpson, to select short-term credit insurance policies to fit the company’s international growth strategy. Global Trade Insurance Corporation, was then selected by Freezetone® to handle servicing on the policies. The ability to match terms with the competition gives the Freezetone® cost savings and environmental benefit value proposition greater traction with foreign buyers when deciding upon a supplier. With EXIM credit insurance protecting their bottom line by insuring against nonpayment of receivables, Freezetone® has the confidence to enter markets previously considered too risky.
The Results
Today, the company is celebrating over 40 years in business with customers in 52 countries from Central and South America, the Caribbean, Europe, Northern Africa, the Middle East, India, and China. With EXIM, Freezetone® is adding revenue streams in new export markets and expanding their manufacturing base, creating more jobs at home.
The ability to keep scaling revenues by entering new export markets and confidently take on the competition was critical to the company’s business model. EXIM support enables this small, minority-owned business out of Florida to go toe-to-toe with their much larger international competitors. Here is what Louis M. Latour, President of Freezetone®, stated about EXIM support.
“Thanks to EXIM bank risk insurance protection, Freezetone® products is realizing its goal of worldwide coverage.”
Freezetone® stays true to its environmental mission and now offers a line of environmentally friendly cleaning and polishing products in markets worldwide. Are you ready to expand your business internationally and diversify your revenue base? Contact your local EXIM Trade Finance Specialist for a free consultation and explore your options. 