Problem: Winter is the time of the year when people like their log fire heating. However, the wood needs to be harvested, picked and packed in the months leading up to winter. The first delivery of wood was made to the retailers – but the invoice terms were 30 days.
When a cold snap hit in late autumn, the retailers needed more wood, but our client needed payments to be able to re-stock. And they now needed to pay for salaries as well as ship in the next load of wood. They had real cash flow problems and it needed to be fixed fast.
Solution: With the client’s financial reserves exhausted, including lending facility through their bank, Fifo Capital was quickly able to ascertain they had good, reliable debtors. Within 48 hours we had advanced 80% of $27,000 worth of invoices . The client was soon able to meet the next round of orders as well as pay staff.