Rosenthal & Rosenthal completed a $2 million work-in-process production finance deal for a home gardening products manufacturer based in Pennsylvania.
The commercial lending division of a multi-national bank tapped Rosenthal to help a long-standing profitable client that had landed several large retailer programs for their seasonal product line. If executed, the influx of additional orders would result in doubling the client’s revenue. Given the extraordinarily large seasonal inventory build and the projected degree of inventory reliance within the forecasted borrowing base, the bank determined that purchase order financing was the right tool to address the client’s increasing financing needs.
Rosenthal, a preferred partner of the bank, structured a supply chain finance solution for the client. The $2 million work-in-process production finance facility allowed the client to purchase imported containers from China and specialized soil and seed from Europe. The financing also enabled the client to fund domestic packaging and fulfillment costs to two third-party logistics firms that assembled and shipped the finished growing kit products. The deal involved cash payments to all foreign and domestic suppliers as well as logistics costs.
The referring bank will advance on all accounts receivable generated from Rosenthal’s production financing and will retain all of its ancillary banking product business by working in tandem with Rosenthal to serve the client’s seasonal incremental financing requirements.
“Rosenthal’s P/O Finance Group was honored to be referred by a long-time banking partner to structure and fund a challenging production deal for this client,” said Rosenthal division head Paul Schuldiner. “Rosenthal has a track record of success working with third-party banks and finance companies to address complex international and domestic supply chain challenges. We look forward to assisting more companies that require either traditional purchase order financing for finished goods or work in process production financing.”
