GJG International's Success Story

Grow Global While Staying Lean

The Perfect International Payment Solution

Success Story: GJG International

  • By: Lean Payments

A Canadian Manufacturer with U.S. Customers & Oversees Suppliers 

 

Nitin Jain is the president of GJG International, a custom manufacturing company located in Ontario, Canada. GJG International outsources the manufacturing of these mechanical parts to China and India. The company’s customer base is mainly located in the United States, which posed a problem for Nitin. Canadian small-to-medium enterprises (SMEs), like GJG International, find accepting international payments to be challenging.

 

► Before Lean Payments:

 

Nitin was waiting weeks to receive cash flow.

 

► With Lean Payments:

 

Nitin was paid in one business day.

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Settling For Paper Cheques

It may seem easier to have customers send paper cheques, but they come with multiple setbacks.

 

Nitin accepted what his customers thought to be the easiest solution: paper cheques. It is the simplest process for his customers, but the least advantageous for Nitin . This method prolongs Nitin’s cash cycle and applies pressure on the business overall cash flow. Sending cheques in the mail can take up to three weeks. It also takes banks longer to verify foreign cheques. The long waiting period slows down production because the manufacturer waits to get paid before completing the product. Nitin accepted paper cheques, but wanted a better solution. He began searching for the best way to receive international payments.

 

► Two to three weeks to receive cheques by mail

► Can take a week to process international cheques

► Holds up suppliers payments

South Of Border Banking Complications

 

Nitin thought about opening a bank account south of the border to collect payments faster and more importantly continue to make it easier for his customers to pay.  Nitin only has a bank account in Canada. To get a bank account in the US, the business must be incorporated in the States.  It can be costly and complicated for a business to have headquarters abroad. Nitin would be paying taxes in both Canada and the United States. He decided that opening a U.S. bank account was not worth it for GJG International.

 

► Have to pay taxes in both countries

► Extensive set-up process

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Accepting Credit Cards Erodes Your Bottom Line

 

Another option Nitin debated was accepting  credit card payments. He thought this method might be easier for customers, but he discovered the drawback of credit card transactions: they take a percentage of the payment. The typical credit card processing fee is three percent of the transaction. As a SME, Nitin felt GJG International should not be spending money on credit card transactions if there was an easier way.

 

► Processing fees per credit transaction about 3%

► FX conversion is another 2% 

Learn More About Processing Fees
Customer Apprehension With International Wires

 

Wire transfers are an additional way to send money internationally. Nitin said his customers opted out of sending wire transfers. It can be confusing with the different transaction codes and transaction numbers. They wanted an easier way that was not as susceptible to scammers. Also, Wire transfers can cost up to 50-60 USD per transaction. 

 

► Confusing for customers to set-up

► Easier for scammers to hack into

► High transaction fees 

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A Groundbreaking Solution

When Nitin found Lean Payments, his international payment challenges were solved.

 

Lean Payments helped GJG International accept ACH payments instantly. Lean Payments offered payment solution services that made the process easier for the customer and faster for Nitin.  It created a virtual bank account without the complications of Nitin opening his own account in the United States. It allows the company to act as a local vendor. 

 

Furthermore, Lean Payments used a fixed fee, not a percentage of the transaction. Another advantage to this payment solution was that it did not force the conversion of currencies into Canadian dollars. Nitin was able to pay the manufacturers in Asia directly without any conversion costs. 

 

► Creates a virtual bank account without the costs and complications 

► Fixed fees and not percentages take from transactions

► No forced conversions

Learn More About Virtual Accounts