What is Distributor Financing?
HOW DOES IT WORK
Suppliers, Distributors and Banks
Credit Assessment
Purchase Order
The distributor places an order with the supplier for goods.
Invoice Generation
The supplier generates an invoice and uploads it to the SCF platform.
Credit Approval
Based on pre-approved credit limits or after a quick assessment, the bank approves the financing for the distributor.
Payment to Supplier
The banks or financial institution pays the supplier immediately or within a short period, ensuring the supplier has the necessary working capital.
Shipment
The supplier ships the goods to the distributor.
Confirmation
The distributor confirms receipt of the goods on the platform.
Flexible Terms
The distributor repays the financed amount to the banks according to the agreed-upon terms.
Interest and Fees
The distributor may pay interest or fees for the financing service.
Benefits of Fauree’s distributor financING
For a Buyer
Improved Cash Flow: Allows distributors to manage their cash flow better by delaying payments while still acquiring necessary inventory.
Increased Purchasing Power: Enables distributors to buy more goods than they could with their available cash, potentially leading to higher sales.
Flexible Repayment: Offers flexible repayment terms that align with the distributor’s cash flow cycles.
For a Supplier
Guaranteed Payments: Suppliers receive payments promptly, reducing the risk of bad debt.
Increased Sales: By facilitating financing for distributors, suppliers can increase their sales volume.
Strengthened Relationships: Strengthens the relationship between suppliers and distributors by supporting their business growth.