Originally a garage-based business launched in Grande Pointe, MB, Titan Environmental Containment quickly grew and moved its operations into an 8,000-square-foot building on a six-acre lot, which is currently home to its headquarters. In addition to its Manitoba operation, Titan also has three other locations in Canada, and has established a wholly owned U.S. subsidiary.
The company supplies and installs high-quality geosynthetics, containment systems and specialty civil engineering products on construction sites. Generally, its geomembrane liners, geogrids and geotextile fabrics are used to protect the environment on sites such as landfills or lagoons that require lining to be operational.
Titan is also growing its distribution side, which accounts for a little more than half of its business. The company designs some of its own products and has them manufactured overseas, but for the most part, it distributes other companies’ products worldwide.
“Every product we sell is designed to benefit the environment and decrease our carbon footprint,” says CFO Derek Bishop. “Whether it’s to retain drinking water, prevent gases from emitting or contain spills on the construction side—it’s all about protecting the environment. Our competitive advantage is that we not only supply the material and install it, we also help design a custom solution to the problems our customers are trying to solve.”
The company does business on every continent and since it works on big, project-specific contracts that often involve new customers, Titan turned to Export Development Canada (EDC) for support.
Anytime I talk to another CFO, I recommend EDC Portfolio Credit Insurance. If you’re not using it and you’re in the construction industry, you really should be.
Accessing EDC’s services
In 2016, Titan reached out to EDC for Portfolio Credit Insurance.
“We’re 90% covered for any receivables, so it’s really another layer on our credit policy,” Bishop says. “And it’s nice because with EDC, you’re making sure you’re doing business with the right customers. At the end of the day, you’re protected if something goes wrong—and the premiums are really reasonable.”
Soon, Bishop expects to also use EDC’s Account Performance Security Guarantee.
“If we come into a big project and the manufacturer overseas doesn’t give us credit terms and they want cash up front, we can say we have a letter of credit from our bank,” Bishop says of the product. “Instead of having to have that cash in our account, EDC comes in and backstops the letter of credit. We don’t have to have the money sitting there. It’s a no-brainer if you’re working with manufacturers that just don’t offer terms.”
In addition, Titan accessed EDC’s Export Guarantee Program about three years ago, which allowed the company to set up its U.S. subsidiary, Titan Environmental USA. Without that support, the U.S. company, which serves as Titan’s fabrication facility, wouldn’t exist right now Bishop says.
“For us, EDC has just been an excellent avenue of support,” he says. “Without it, it would be infinitely more difficult to enter a new market. Without EDC, you can be blind at times.”
The future looks bright
In the three years since Titan started using EDC Portfolio Credit Insurance, the company has grown sales by more than 60%.
“And we’re comfortable with that level of growth because we have a better sense of how our customers are doing financially through the insurance program,” Bishop says. “It’s hard to quantify, but it’s definitely made us more comfortable with the speed of growth.”
Titan has ambitious plans for exports. It wants to see the U.S. company, which saw growth of 60% last year, continue to add to the bottom line. It also hopes to clear an additional 20% in sales from completely new markets next year.
“It’s a pretty broad plan,” Bishop says. “We have a lot of irons in the fire. Exports are definitely one of our big strategic priorities in 2019.”
EDC Service used
EDC Portfolio Credit Insurance is an online solution that’s ideal if you’re looking to insure your receivables for up to $500,000 per customer against non-payment.
It covers up to 90% of insured losses should your customer not pay, due to circumstances such as bankruptcy, payment default, market hostilities or currency conversion or transfer.
EDC service used
Bonding and guarantee solutions
Posting bonds and letters of guarantee are a necessary part of exporting—buyers can demand bonds at almost any stage of the contract—and issuing bonds can be expensive and risky, since your financial institution will freeze your operating line or ask for collateral equivalent to the amount of the bond.
With the protection offered by our bonding and guarantee solutions, your bank may choose to drop its collateral requirements, helping you free up much-needed working capital.
EDC service used
Our Export Guarantee Program can help your bank provide you with additional access to financing.
We share the risk with your bank by providing a guarantee on the money you borrow, encouraging them to increase your access to working capital.