Funding the supply chain: a vital link, or a constant challenge?

Funding the supply chain: a vital link, or a constant challenge?

Man in warehouse - Funding the supply chain


Funding the supply chain is a fundamental element of business success – every business is dependent on their supply chain in some way. Some thrive on strong partnerships with one or two main contractors, whilst others depend on a huge number of smaller suppliers.

Or perhaps you are one of those contractors – with your own liquidity and working capital position dependent on one or two main clients, and vulnerable to changes they may make in their payment terms.

If any of the questions below apply to you, maybe it’s time to consider an alternative form of finance:

  • “Are your accounts team fed up with fielding calls from suppliers chasing payment?”
  • “Is the 67% from your invoice discounting supplier enough to finance your next materials purchase?”
  • “Are you able to negotiate early payment discounts with suppliers and subcontractors?”
  • “Are worries about working capital keeping you and the board awake at night?”
  • “Is your product or service hugely reliant on your subcontractor network?”

 

An alternative way of funding the supply chain

Supply chain finance offers a true alternative to invoice discounting, reverse factoring or a bank overdraft.

With significant benefits for both supplier and client, supply chain finance can be used as either a replacement for, or an addition to, facilities provided by your main bank.

What’s even better is that supply chain finance the Woodsford Tradebridge way, is typically unsecured, sitting gently alongside other forms of finance.

Tobar logo - Funding the supply chainOur main source of working capital finance is a secured, asset-based lending facility through RBS. But of course, this facility is limited by security. We also have a revolving cash facility which we do use, but it’s very expensive. The Woodsford TradeBridge supply chain finance facility is the perfect complement to the RBS facility, as it is unsecured, with no tie-ins, and offers highly competitive rates”,

– Glyn Loveday, CFO, Tobar Toys

Benefits for both the buyer and the supplier

For the buyer, supply chain finance creates a financially stable and more competitive supply chain – the buyer can choose any supplier and is not restrained by the credit-worthiness of that supplier.

Supply chain finance is also highly flexible – it can be applied to just one supplier, to them all, or even to just a single invoice. This makes it a tool that the business can use when needed and keep safely in reserve when cash is not an issue.

This type of working capital freedom allows businesses to accelerate their growth.

Matrix Polymers logo - Funding the supply chain “We have huge opportunities to grow, especially in Asia, where our business has grown by more than 120% over the past 3 years. The Woodsford TradeBridge facility gives huge flexibility to our business, helping us deliver our aggressive global growth plans”,

– Simon Wallington, Global COO, Matrix Polymers

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Martin Garrow - Supply Chain Finance

“Scratching your head for an alternative way of funding the supply chain? Supply chain finance has evolved, and it’s so much more than an overdraft, reverse factoring, or invoice discounting”,

– Martin Garrow, Associate Director, Woodsford TradeBridge

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