Daily News: June 26, 2012

King Trade Provides $5 Million PO Finance Commitment to Importer


King Trade Capital (KTC) announced the recent funding of a $5 million purchase order finance commitment for a Maryland-based importer of lighting fixtures and home decorative products.

King Trade Capital was introduced by a financial consultant to a client that was seeking a finance solution to support the purchase of the inventory required to fulfill large Fall season programs from two major retailers. Due to establishing new sources of overseas supply, to cope with the increased volume of orders, the company did not have sufficient open terms from its new vendors to purchase the inventory required for these sales programs.

King Trade Capital quickly established a facility that provides financing with an advance rate of 100% of the cost of the required inventory by issuing letters of credit to the company’s overseas supplier as well as funding for the freight, duty, and logistics costs. KTC’s flexibility and creativity paid off since the client not only had an existing bank facility but also needed to be paired with a new factor.

KTC successfully established two separate inter-creditor agreements with not only the factor but also the existing bank. The structure allowed the company to finance the entire supply chain using alternative finance channels dictated by the needs of each of the major retailers. As a result, this enabled the company to substantially increase its business with both major international retail chains.

King Trade Capital is an independent purchase order and contract finance company in the U.S. focused on providing purchase order and contract finance for small- to middle-market companies nationwide.