King Trade Capital completed a purchase order finance facility for a California based children’s clothing and toy company
King Trade Capital was contacted by a finance consultant that was helping the client find the right partner to deliver $3 million of POs awarded to them by one of the largest U.S. retailers.
The new program with the retailer created a large capital need that exceeded the client’s credit facilities with its working capital lenders. The company needed a finance solution to secure production from its overseas factories to ensure its goods would be produced and delivered fast enough to meet the delivery schedule of the customer.
KTC was able to move quickly to structure a finance facility that provided a solution to the client’s large capital need to secure production and get inventory delivered in time to fulfill the retailer’s delivery dates.
KTC worked alongside an existing cash flow lender and a factoring company to negotiate inter-creditor agreements with both parties to provide the client with a complete trade cycle finance solution. KTC’s facility provides the client’s supplier with documentary letters of credit to secure production and timely shipment of goods. The factoring company will provide additional liquidity to the client upon delivery of the goods to the end customer.
With KTC’s solution the client is able to finance the growth in sales and keep its overseas supplier producing and shipping to fulfill the larger purchase orders.