Sellers Case Study

A Seller sells goods on 45 day terms to 5 Buyers. Shipping to the Vendor Managed Inventory Hubs (VMIs) takes 4 weeks. The goods are pulled after 2 weeks in the VMI.

Here is how LogisticsFinance can help:

• LF purchases the goods from the Seller under the negotiated terms
• LF manages the processes with the Buyer (Invoices, Payments, etc.)
• LF pays the Seller within 3 days
• LF sells the goods to the Buyers when the goods are pulled from the VMIs
• LF invoices the buyer and collects based on the negotiated terms
• LF receives a service fee from the Seller

Benefits to the Seller

• Improved liquidity position by 100% cash for 11 weeks
• Procurement of goods while in transit and in VMI for 6 weeks
• Shortened payment terms from 45 days to 3 days
• Efficiency gains and cost reduction in operational processes (Invoices and Payments)
• Incremental credit capacity
• Reduction of pressure from Buyer on payment terms