TradeCap closed a $500,000 trade finance facility with a Colorado-based toy company.
The company experienced exponential growth in 2016 and sales through Q2/17 had already surpassed that of the prior year. In the midst of booking orders for its upcoming holiday season, the company received a sizable order from a new customer. The increased order was incremental to the normal seasonal needs and created an inventory finance need over and above what its existing working capital base could support.
Initially, the company evaluated an alternative source of financing from private investors. That option required it to drawdown a large slug of capital for a minimum period exceeding a year. This option did not match the company’s shorter term needs. TradeCap proposed a transactional trade finance facility, which enabled the company to finance 100% of the inventory, freight and warehousing costs needed to fulfill the incremental order received.
TradeCap’s offering reduced the company’s capital costs compared to the less flexible, longer term-debt option they were pursuing. The company now has a facility in place that will provide the incremental financing needed to support its continued growth.
TradeCap Partners specializes in providing purchase order and alternative inventory finance solutions ranging from $50,000 to $15 million for small and medium-sized businesses in the U.S., Canada and the U.K.