Starting your in house trading firm ??

A trend starting from 2020

Recently a shipowner asked me , is that difficult to set up a in-house bunker trading house ?? They would love to expand to the bunker trading business not only limited to their own fleet . Since they have credit from most suppliers in the region and they know many owners/ operators that could be their potential client.

It’s no surprise that after few new trading house starting this year by some blue chips ship owner , many shipping companies are tempted to start their own venture. What should we consider when thinking about set up a new bunker trading firm ?

1. Credit issue

Most important aspect of a bunker trading house. The ability of getting new client is no match compare the ability to get your money back. Some owners might think they can focus on their charter and people they know only , yet when the firm developed they will always try to get more new clients which they are not 100% sure . In that case late payment / default might be faced .

2. Cash flow

You might be a prompt payer yourself but your friend or chartered not necessary share the same practice. One of the key features for a trader is their payment performance , you might have to pay your supplier on 30 days even your client pay you 60days. Nothing turn a physical supplier away more than hearing “ sorry I can’t pay you yet as my client didn’t pay me .”

Until next time

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Starting your in house trading firm ??

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