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Finished Products Financing
Delivering value to top global car manufacturer by financing & distributing to its customers
Customer facts
Geography - Europe
Sector - Automotive
Services - Purchase, warehousing & distribution of Inventory
Customer challenge
A large car producer was facing marketing & financial constrains driven by the sale of one of its core brands to another international group. The sold brand oversaw the distribution of core models across the dealers’ network in Europe & the customer wanted to retain control of this distribution after the separation. Therefore, the customer was highly interested to move the ownership of the produced cars from the sold brand to a 3rd Party Distributor, which could hold ownership of the titles, anticipate revenue recognition & ensure an Off-Balance sheet effect.
Opportunity Scope:
The customer wanted to anticipate revenue recognition, free-up cash, & retain control of the strategic brands distributed in Europe.
EVDO solution
Efficient management of the working capital process related to sales of finished products by the producer. Anticipated liquidity, driven by true-sale transactions & immediate revenue recognition. Cashflow positive position as goods are sold very early in the sale cycle. This, combined with third-party TradeCo absorbing extended payments terms from the dealers, meant that inflow of cash can be materially accelerated. Complete off-balance sheet solution in conjunction with an integrated end-to end logistic service. Marketing advantage in terms of retaining control over its distribution network & capacity to pursue planned mid/long-term European strategy in terms of market positioning.
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