Importing from China: what brokers should know about the working capital gap
For commercial finance brokers, importing from China can reveal a working capital need well before a client asks for funding. Understanding supplier payment terms, freight, landed costs and customer payment cycles can help brokers identify cash flow gaps and explore whether trade finance could better support the client’s trading cycle.
- Importing from China can create significant working capital gaps between paying suppliers and receiving customer payments.
- Supplier terms, freight, inventory holding periods and customer payment cycles all influence an importer’s true funding requirement.
- Brokers can identify trade finance opportunities by understanding where cash becomes tied up across the client’s trade cycle.
- Import duties, biosecurity charges, freight surcharges and anti-dumping measures can increase landed costs and pressure available cash.
- OctetTrade can help eligible clients fund supplier payments while preserving working capital for other business expenses.
For commercial finance brokers, a client importing goods from China can present a working capital opportunity well before they ask for finance.
The reason is simple. Importers often need to pay suppliers before goods are manufactured or shipped, then wait for stock to arrive in Australia, clear customs, be sold and ultimately turn into customer payments.
That can leave cash committed for weeks or months.
Understanding that trade cycle can help brokers identify when a client's funding structure may no longer match the way the business operates.
Here is where Australian businesses can find current information on importing from China (as at 1 September 2026).
China remains Australia's largest two-way trading partner. According to the Department of Foreign Affairs and Trade (DFAT), two-way goods and services trade was worth $326 billion in 2025, representing around 25% of Australia's total trade.
"For brokers working with wholesalers, distributors, manufacturers, retailers and eCommerce businesses, that means imported Chinese goods are likely to remain an important part of many clients' supply chains," says Rudy Messerschmidt, Octet Director Working Capital Solutions QLD.
Australia's trading framework with China has also changed significantly.
Under the China-Australia Free Trade Agreement (ChAFTA) Australia progressively eliminated tariffs on qualifying Chinese-origin goods, reaching 100% tariff elimination by 1 January 2019. Goods need to satisfy the applicable rules of origin to receive preferential treatment.
Australia and China are also parties to the Regional Comprehensive Economic Partnership Agreement (RCEP), while Australia has separately removed hundreds of so-called nuisance tariffs.
But for a broker, duty is only part of the conversation.
According to the Australian Bureau of Statistics, in 2026 China has remained Australia's number one export destination and number one source of imports.
Rudy MesserschmidtOctet Director Working Capital Finance QLD
A common mistake is to look at the purchase price of imported stock without considering the entire cash flow cycle.
A client's landed cost can include:
- the supplier invoice
- deposits required before production
- international freight and surcharges
- GST
- import processing charges
- biosecurity charges
- customs broker and logistics costs
- storage or container detention
- import permits where required
- anti-dumping or countervailing duties on affected products.
From 1 July 2026, for example, Australian Border Force charges a $48 biosecurity cost recovery charge for full import declarations by air and $71 by sea on consignments over $1,000. Electronic import processing charges are currently $50 for consignments over $1,000 but below $10,000 and $152 for consignments of $10,000 or more.
These individual amounts may not determine whether a client needs finance.
"The more important question is when all the cash leaves the business compared with when it comes back in," states Rudy.
For a detailed overview of the current importing requirements and sources businesses can check, brokers can refer clients to our guide: Importing from China in 2026: what Australian businesses need to know.
When talking to an importing business, brokers can learn a lot by understanding the journey from purchase order to customer payment.
Useful areas to explore include:
When does the supplier get paid?
Does the client pay a deposit when ordering, the balance before shipment, cash on delivery or receive supplier credit?
How long does the stock take to arrive?
Production time and international freight can mean cash is committed long before the product generates revenue.
How long does inventory remain in the business?
Stock that sits in a warehouse for another 30, 60 or 90 days extends the working capital cycle again.
When do customers pay?
A wholesaler importing stock from China may pay its supplier before shipment but then offer Australian customers 30 or 60-day terms.
Put those stages together and a business can have significant cash tied up between placing an order and receiving the final customer payment.
That is often the real finance need.
An importing client does not necessarily need to be experiencing financial distress to have a working capital requirement.
In fact, growth can create the problem.
A broker may see an opportunity where a client:
- has secured a large customer order but needs to buy stock first
- wants to increase order volumes to meet growing demand
- needs to build inventory ahead of a seasonal sales period
- is being offered better pricing for larger purchases
- can access an early-payment discount from a supplier
- is paying overseas suppliers upfront while customers pay on terms
- is regularly drawing down cash reserves to fund stock
- has profitable sales growth but declining available cash
- is relying on property-backed finance for a recurring trade requirement.
These are different symptoms of the same underlying issue: the timing of cash outflows is not aligned with the timing of cash inflows.
Rudy says: "For brokers accustomed to property or term lending, recognising this timing mismatch can open a different type of funding conversation."
A broker does not need to become a customs broker or importing specialist.
What can be valuable is knowing that certain costs or requirements exist and directing the client to the appropriate source.
For example:
- DFAT's FTA Portal can help businesses identify tariffs and free trade agreement requirements.
- Australian Border Force provides information on tariff classification, import declarations and processing charges.
- DAFF's BICON system shows whether goods are permitted, subject to biosecurity conditions, require supporting documents, treatment or an import permit.
- The Anti-Dumping Commission's Dumping Commodity Register lists current goods subject to anti-dumping or countervailing measures and identifies current inquiries.
"Anti-dumping is particularly worth being aware of because it is separate from the normal customs tariff," explains Rudy. "A product can therefore qualify for zero tariff treatment under a free trade agreement while still being subject to an anti-dumping measure."
The objective is not for the broker to determine the client's customs position, but to recognise that these costs can affect the amount and timing of working capital required.
Once the trade cycle is understood, the funding requirement becomes easier to identify.
Trade finance is designed around supplier payments rather than a one-off lump-sum borrowing requirement.
OctetTrade is a revolving line of credit that can pay approved domestic and international suppliers directly, allowing the client to preserve its own cash while goods move through the trade cycle.
Approved businesses can receive up to 120 days to repay, including up to 60 days interest free. Suppliers are paid directly through the Octet platform and undergo compliance verification before payments are processed.
The funding can cover 100% of eligible supplier invoice values, including upfront deposit requirements, subject to approval.
For a broker, that can mean shifting the conversation from:
“How much money does the client want to borrow?” TO
“How much working capital is tied up between paying suppliers and getting paid by customers?”
That is often a much better way to understand an importing client's true finance requirement.
"A business importing successfully from China can still experience cash flow pressure because growth, larger orders and longer trade cycles require more working capital," says Rudy.
Understanding supplier payment terms, production and shipping lead times, inventory days and customer payment terms can help brokers identify that requirement earlier.
And where paying suppliers upfront is constraining the client's available cash, OctetTrade provides brokers with another funding option to explore alongside their client.
Explore the OctetTrade Finance solution to learn how it can support your client's next order from China and other international markets.
Published on 1 September 2026. This guide is general information only. Import requirements vary according to the goods, their origin, value and the circumstances of the transaction. The relevant government agency, licensed customs broker, freight forwarder or other qualified specialist can provide information specific to an individual shipment.
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Disclaimer: The above article content and comments are our views and should not be construed as advice. You should act using your own information and judgment. Although information has been obtained from and is based upon multiple sources the author believes to be reliable, we do not guarantee its accuracy and it may be incomplete or condensed. All opinions and estimates constitute the author’s own judgment as at the date of publication and are subject to change without notice.