The Company sources products for distribution to retail stores in Canada and were presented with an opportunity to expand their distribution into the US market. The Company’s Canadian lender was not prepared to finance the costs to purchase the inventory necessary to supply the US retailers. Further, the US retailers were selling the product on consignment which meant there was less certainty the inventory would ultimately be sold.
Welch Capital Partners’ Approach
It was important for us to understand the Company’s supply chain and sales model. The long lead-time, combined with no firm purchase order from the US retailers, would mean that neither an asset-backed lender nor purchase order financing would be suitable for the Company. The lending profile required a very niche lending partner who was willing to provide unsecured inventory financing.
Welch Capital Partners’ Advantage
We leveraged our network of very niche lending players to get a solution in place for the Company. Now, the Company has a financing partner it can use to accelerate its US expansion.