A liquor store distribution company had built strong relationships with several retailers, supplying them with a wide range of products. However, while business was steady, the company faced significant cash flow challenges due to the payment terms of their clients. Many small liquor stores paid in 30 days, while larger chain stores and distributors often extended their payments to 60 days. As the distributor waited for payments to come in, operating expenses—such as inventory purchases, transportation, and employee wages—piled up, creating a financial bottleneck.
That’s when they turned to Factor & Fund for a solution.
The Problem: Slow Payments, Fast Costs
The liquor store distributor was in a tight spot. Though sales were consistent, waiting 30 to 60 days for payment was unsustainable. The company needed cash to buy inventory, cover operational costs, and keep deliveries running. Traditional bank loans weren’t the right fit because they took too long to approve and didn’t provide the flexibility the distributor needed to address ongoing cash flow issues.
The Solution: Invoice Factoring for Liquor Distributors
After discussing their challenges with Factor & Fund, the company decided to leverage invoice factoring as a way to stabilize their cash flow and continue operating efficiently.
Here’s how it worked:
- Invoice Submission: The liquor distributor submitted unpaid invoices from liquor stores and chain retailers to Factor & Fund after completing deliveries.
- Quick Cash Advance: Within 48 hours, Factor & Fund advanced up to 90% of the invoice value, giving the distributor immediate access to working capital.
- Remaining Balance: When the liquor stores eventually paid the invoice (whether in 30 or 60 days), Factor & Fund remitted the remaining balance, minus a small factoring fee.
Results: Liquidity Without the Wait
By factoring their invoices, the liquor store distributor was able to maintain consistent cash flow, ensuring they had the funds to buy more inventory and cover operational expenses. Here’s what changed:
- Smooth Cash Flow: The distributor no longer had to wait for slow payments from clients, giving them the cash they needed to restock shelves and grow their business.
- No Additional Debt: Invoice factoring allowed them to access the funds tied up in invoices without taking on traditional loans or adding debt to their balance sheet.
- Faster Growth: With cash flow stabilized, the distributor could focus on expanding their network, increasing deliveries, and even negotiating new contracts with large retail chains.
Client’s Perspective
“Without Factor & Fund’s help, we couldn’t manage the delayed payments from our liquor store clients. Factoring our invoices gave us immediate access to the cash we needed to buy inventory and pay our team on time. Now we’re able to grow without the cash flow headaches.”
– Owner, Liquor Store Distributor
Why Choose Factor & Fund?
- Fast Funding: Receive 90% of your invoice value in as little as 48 hours, helping you cover costs quickly.
- No Debt: Factoring provides cash flow without the need for loans.
- Industry Expertise: We understand the challenges of distribution businesses, particularly those supplying liquor stores with extended payment terms.
If you’re a liquor store distributor struggling with cash flow, let Factor & Fund help you stay ahead. Visit factorandfund.com or contact us today to learn more about our invoice factoring solutions and how we can help your business grow.