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Gateway Trade Funding Provides Canadian Distributor Factoring & PO Financing

June 27, 2016, 08:00 AM
Filed Under: Factoring

When a Canadian distributor of a European manufacturer of innovative ground screws needed funding for large orders they turned to Gateway Trade Funding.
The distributor’s products (ground screws) are used in construction to establish a foundation in virtually any terrain. As an alternative to concrete slab foundations, the ground screws allow quick and stable foundations to be installed where traditional solutions may not be ideal.  However, shipping the product from the Czech Republic meant that there was a considerable lag time between when payment to the manufacturer was due and when the distributor could collect from the purchaser.  
Traditional bank financing was not available because of a number of hurdles including international currency conversions, the innovative and non-traditional nature of the product and the involvement of somewhat risky construction projects.
Gateway in conjunction with its factor partner was able to structure a solution involving purchase order financing and factoring that worked well for the distributor, allowing them to create the cash flow needed to complete transactions for customers in both the US and Canada.
“This solution was not without several challenges,” said the factor. “Working with multiple players in multiple countries and funding the significant transportation time all complicated the transactions.  Working with Gateway Trade Funding outside Chicago, we were able to fund this and then manage all of the logistics and needs of each participant.”
Funding these transactions is expected to exceed $2.5 million (USD).  “The financing solution allows this particular distributor to capture business they would not otherwise be able to transact,” said Mark Polinsky, principal at Gateway Trade Funding.  “It’s helping them to grow their business while introducing innovative solutions to their customers.”

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