Inventory
Purchase Program
First Capital offers inventory purchase funding to:
Importers seeking to:
- Avoid ownership (and adverse impact)
of inventory until needed for manufacture/resale by insisting
on vendor managed inventory
programs
(VMI)
- Outsource logistics and supply
chain management to third-party logistics companies (3PLs)
Suppliers seeking to:
- Improve cash flow by selling for
cash VMI program inventory
- Outsource logistics and supply
chain management to 3PLs
- Increase competitiveness by accepting
VMI requirements
Description
In partnership with world-class 3PLs, First Capital purchases for cash — against “take or
pay” contracts issued by large rated importers
— finished
inventory from foreign suppliers and holds such inventory until requested
for delivery by importers
Structure / Process
- Importer executes “take or pay” purchase
contract for supply of goods from the foreign supplier under a VMI program
- Importer
executes a supply chain logistics management contract with
a 3PL company for services such as freight forwarding, customs
clearance, warehousing, inventory management, distribution,
etc.
- Importer and supplier assign purchase and 3PL contracts
to First Capital whereby importer, supplier and 3PL accept
responsibilities for all product quality, liability, contractual
performance
- Supplier
delivers goods to the 3PL and invoices First Capital
- First Capital pays supplier and takes ownership of the goods
at the 3PL.
- Upon delivery instructions from the importer, 3PL ships
the goods and First Capital invoices the importer.
- Importer pays First Capital
This Program is designed for:
- Large North American importers
of goods on a VMI basis
- Foreign exporters selling to the
above importers
- 3PLs seeking to partner with a
lender prepared to finance vendor managed inventory by owning
it
Pricing
Pricing is variable, based on the volume and size of purchases
and the credit quality of importers. The interest rate is prime-based
for cash advances. Transaction handling charges may apply.
Criteria
Minimum annual volume of: $20 million
Maximum inventory hold period: 180
days
For
further information, please call 800-619-0804 or click Contact
Us. |
