King Trade Capital provided a new $8 million trade finance facility to a California-based home goods and party supply company that has a fast-growing relationship with one of the world’s largest online retailers.
KTC was introduced to the company by a finance industry consultant who was helping the 5-year-old company with strategies to handle its fast growth and its relationship with its largest customer.
The client established itself as a trusted supplier to the online retailer. As their business relationship solidified, the online retailer recognized that the company had the infrastructure and team to handle large bulk orders and its purchase orders grew significantly.
The quick expansion created a working capital strain on the company as it needed to be able to fulfill bulk orders while continuing to fulfill its existing orders. The strain also put the client at risk of being unable to perform upon hard earned growth in sales. In fact, the company had to reject purchase orders due to the lack of capital needed to fulfill the orders on time.
After being introduced to the client, the KTC team quickly assessed that the company was competent and simply needed capital to grow their sales and profits. KTC structured a trade finance facility that met its unique growth needs and brought in a nationwide receivable lender with a specialty in the online retailer to provide liquidity after the retailer was invoiced.
KTC’s facility pays the client’s vendors the cash they need in order to ship the goods in a timely manner, making it possible for the client to fulfill all of its purchase orders from its end customers. The trade finance facility is also structured to help any future sales expansion.