Furniture Retailer Maximizes Supplier Discounts
A prominent furniture retailer with $550 million in revenue, sourcing from Asian suppliers, utilizes strategic supply chain financing to extend payment terms, optimize cash flow, and enhance working capital efficiency.
Deal Structure & Key Details
A supplier credit transaction providing $15 million in unsecured liquidity, allowing direct supplier payments and 180-day repayment terms.
Facility
$15,000,000
Security
Unsecured
Company Revenue
$550,000,000
Supplier fee
8% (Net to Client)
The Challenge
Long cash conversion cycles, Limited Growth
The furniture retailer struggles with a prolonged cash conversion cycle—paying Asian suppliers immediately upon shipment but waiting 120 days to collect payments from customers. This gap ties up significant working capital, limiting the company’s ability to invest in inventory, expansion, and operational improvements. Without a financial cushion, growth opportunities are delayed, and supplier relationships may weaken due to inconsistent purchasing power.
- Cash Flow Gap
- High Upfront Costs
- Working Capital Constraints
- Limited Growth Flexibility
Solution
Liquidity Without Limits
Zenith provides a $15 million supplier credit facility, paying suppliers directly at the time of shipment while allowing the retailer 180 days to repay. This solution bridges the cash flow gap, ensuring that working capital remains available for core operations, expansion, and strategic investments. By eliminating the need for upfront payments, the retailer can maintain a steady supply chain, strengthen supplier relationships, and improve financial stability—all without restrictive covenants or collateral requirements.
- Optimized Cash Flow
- Unsecured Flexible Financing
- Enhanced Supplier Relationships
- Growth-Ready Liquidity
results
Quantifiable Impact
Optimized cash flow
The company no longer pays upfront for inventory, leveraging Zenith's extended terms to repay after sales.
Improved DPO
Extend payment terms from 30 to 180 days while getting suppliers paid upon shipment.
Pre-inventory financing
Zenith pays suppliers upon shipment, maximizing working capital before materials enter inventory.
15M
Growth Ready Liquidity
Zenith unlocked $15M in liquidity without disrupting existing lending arrangements.
The furniture retailer has significantly improved cash flow, operational flexibility, and supplier relationships, enabling long-term financial stability and business growth.
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