The financing needs of the client
The client and many other companies that are currently active in the food sector need working capital. This is a key element because it enables companies to meet its financing and growth needs. A few years ago, the client underwent a very deep restructuring process which had a substantial impact on how the company was financed until then and how it paid its suppliers. Likewise, the company has a seasonal purchasing cycle in certain periods of the year with large purchases from suppliers in order to generate all the necessary stock to satisfy the demand on its stores. The company is also experiencing a major growth process in recent years, requiring financial muscle. In order to sustain this growth, working capital is essential.
Novicap’s solution for the client
The solution that was offered by Novicap to the client consists of a hybrid Reverse Factoring line (Standard and Early Payment) so that the company can manage the payments to its suppliers from Novicap’s platform. All this while offering them the possibility of paying their invoices early, under favourable conditions which facilitates the necessary deferral that their cash flows requires to optimise their cash flow.
The collaboration started out with a Reverse Factoring line, which in the meantime has tripled in size during the first year of its life. This success is thanks to the excellent results that the company has experienced during the first months of using the working capital line.
Novicap has become a high valued partner that plays a role in daily operations and payment management of its suppliers.
As of today, nearly all invoices of the client are processed through Novicap’s Reverse Factoring platform, allowing them to collect the invoices a few days after they have been issued. The client on his experience with Novicap’s Reverse Factoring line:
“We have found Novicap to be an agile partner in our daily operations by offering an efficient technology platform and a high level of service. We are confident that we will continue to strengthen our relationship in the future and that they will accompany us in our growth plans.”