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D2C Apparel Brand
Unfavourable terms from large suppliers due to inability to meet large order quantities at relatively early stage of business
Payments were being made to suppliers in advance by using expensive equity capital
High cash margin requirement from banks for new debt facilities
Our analysis indicated that debt would be a more cost effective and scalable solution (4x) for building inventory across SKUs and for paying suppliers on time.
We helped set up a domestic purchase financing program with reasonable cash margin. Thereby, released expensive equity capital stuck in inventory.
Company was able to extract better terms from suppliers since payment was done on T+1 basis.
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