Factor Group

APPAREL WHOLESALER CASE STUDY

Industry: Garments/Apparel
Client: Apparel Wholesaler
Product: Accounts Receivable Factoring

Scenario 

Due to recent economic changes, this apparel wholesaler was forced to limit sales only to customers who would accept COD terms. This limited their opportunities, as they were not able to reach out to large discount retailers like Ross, Marshalls and Bealls Outlet to very small retailers in the United States & Latin America. The company’s main activities included selling their private label as well as out-of-season garments to very small retailers in Latin America. Because of the quality of their fabrics and the ability to source out-of-season garments of good quality, the company started attracting large clothing retailers in Colombia, Ecuador, Costa Rica and the U.S., but again, their limited capital accessibility hindered their ability to acquire these new customer relationships. The client was unable to fulfill orders to these retailers because of the terms they pay their suppliers.

Solution 

The company was approved for a $400,000 monthly Factoring Facility arranged by Factor Group LLC, which enabled the client to reach out to large retailers and absorb the credit terms they demand. This opened a new source of revenues for the client, providing a healthier client base. Today, the client maxes out its facility month after month, while continuing to source for new retailers in the US and Latin America. The client has grown from $40K a month sales to $400K per month. The factoring facility is expected to increase over the next few months to help the client increase its sales.