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King Trade Capital Completes $1.5MM PO Facility for Importer

June 22, 2015, 07:53 AM
Filed Under: Importer

King Trade Capital announced the completion of a $1.5 MM purchase order facility for a California based importer of promotional and customer incentive products. King Trade Capital was contacted by the client after being referred by an international bank. The client was growing sales to a major retailer and had been financing overseas production with a small factor they had outgrown. Due to the client’s sales concentration with the customer and the continued growth, the client did not have sufficient liquidity to support the production of inventory for future orders.
While the smaller factoring company was supporting the client with working capital advances on accounts receivable, they were limited in their ability to support the growing capital needs related to production and in-transit inventory. Furthermore, the receivables concentration was beginning to outstrip the factor’s credit limits for the retailer.

King Trade Capital worked quickly with the client to structure a finance solution that addressed both the production and in-transit inventory needs as well as the retail customer concentration issues. King Trade Capital was asked to introduce a larger factor to the client and KTC and the factor were in place within five days of initial contact by the client. The solution provided by KTC entailed using letters of credit (“LC”) and documents against payment (“DP”) to fund international inventory purchases by properly structuring the financing of in-transit inventory.  King Trade Capital also provided advances to fund the freight and logistic costs associated with the inventory.

The client now has its finance partners working together to achieve a common goal, supporting future sales growth. KTC’s unmatched experience in providing import finance solutions offers additional incremental capital that benefits companies, their lenders and overseas suppliers that can produce and ship knowing they will be paid on a timely basis. Most importantly, it allows the client to expand their customer base and continue accepting additional orders from primary customers with the confidence they have the financing capacity to fulfill them.
King Trade Capital is the country’s oldest and largest independent purchase order, trade, and contract finance provider. KTC provides small to middle-market companies located in the U.S., UK and Canada finance solutions other traditional lenders can’t. Since 1993, KTC has provided more than $2 billion of capital to over 350 public and private companies worldwide.

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