Export Knowhow

Export risk insurance: growth thanks to risk awareness

u-blox almost went bankrupt because one of its customers became insolvent. The company has learned its lesson. Thanks to clever handling of its accounts receivable risks, the former start-up from Thalwil has grown constantly and now sells its products for positioning and wireless communication technologies across the globe.

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Jean-Pierre Wyss will never forget September 25, 1999. "I was on the Philippines checking out a possible production site when the then Chairman of the Board of Directors called me," the Head of Production and Logistics of u-blox recalls. "He said: The banks have suspended all credit for one of our large customers due to the threat of bankruptcy."

An insolvent customer almost dragged u-blox down with it

That was a shock for Wyss who had co-founded the Federal Institute of Technology (ETH) spin-off in 1997. He was just beginning to enjoy success with his positioning and communication technologies, and had landed his first big customers: including the federal government that was implementing a GPS product in connection with the heavy goods vehicle tax (LSVA).

When u-blox's Finnish customer became insolvent, it almost dragged down the aspiring young company with it. u-blox had to write off a contract worth millions.

Avoiding risk is the wrong strategy

u-blox's loss triggered a company rethink, raising the then start-up's awareness for entrepreneurial risk. "When we started out, we were somewhat casual and particularly focused on opportunities," says Wyss. However, being aware of risks doesn't mean avoiding them altogether: "If we took no risks, we wouldn't survive in this market," says Wyss. Nowadays, u-blox weighs its opportunities and risks carefully and takes risks very consciously and purposefully.

A credit check reduces debtor risks

The company protects itself against financial losses arising from debtor risks with credit insurance: "We are very consistent in this respect," says Wyss. "u-blox is insured against payment default for every customer, from start-ups to established large customers."

But AXA isn't just helping the company with insurance. Its team of financial experts also checks the creditworthiness of potential u-blox customers. u-blox can therefore draw up internal customer ratings. With this support, the company decides whether to enter into business with the new partner, and on what terms. In certain cases, AXA advises setting a credit limit. But it's never easy to inform a new customer about this. That's why Wyss is pleased he can rely on an external partner: "This simplifies communication with the customer." He also finds it reassuring that AXA regularly reviews the creditworthiness of existing customers and informs u-blox if their situation changes.

Credit insurance permits more risk

Thanks to prudent risk management, u-blox has never been through a repeat of a fatal event like that of 1999. On the contrary, the SME has enjoyed constant growth in recent years and now has a presence in 18 countries: "Thanks to our credit insurance, we can take bigger risks in interesting markets," says Wyss. It's also a door-opener for new customers: Since the risk of payment defaults is now averted, u-blox no longer needs to demand payment in advance, and can offer its customers purchase against invoice.

Leading supplier in the field of the Internet of Things

Today, the company headquartered in Thalwil is listed on the stock exchange, and has over 1,000 employees at 25 locations in the US, Asia and Europe. The once young company is a leading supplier in the field of the Internet of Things. It supplies 6,900 customers in 66 countries, including tech giants such as Tesla and Samsung. Its success speaks for itself, with AXA making its contribution in the background.

Credit insurance or accounts receivable insurance

  • protects a business from accounts receivable losses
  • monitors the solvency of customers, collects demands in the event of nonpayment, and compensates unpaid invoices following the insolvency of a customer
  • both in Switzerland and for export business
  • for business to business (B2B) transactions
  • prevents businesses from having to bear payment defaults themselves
  • enables the correct assessment of a new customer
  • boosts success in the competition for new customers since payment deadlines can be granted
  • provides security from the very beginning like an advance payment

Our expert Paolo Larentis, Head of Sales Credit AXA, will be happy to find the ideal customized credit insurance solution for your SME.



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