A company in the packaging sector approached Trade Finance Global (TFG) with an urgent request. The company, which has been trading since 2009, was selling mostly plastic packaging into the retail market, with only 10% of stock being glass based. However, due to environmental and sustainability concerns, as well as demand from their retail customers who were rapidly changing direction towards more sustainable packaging, they wanted to move towards working with an overseas based glass manufacturer to produce jars for the goods.
Orders grew, but due to the new supplier-trade relationship, the company could not access pre shipment finance to ease working capital before the product reached UK ports.
Revenue was set to double and this was based on the increase in glass requirement and competitors being unable to source suitable suppliers. TFG worked with White Oak IE to raise a £500,000 revolving trade finance facility. Having consistently grown the business since 2009, the company required quick support to assist their growth in the food and beverage industry. The contract to supply 34 million glass jars was crucial as it was worth £2.3m spread across 195 separate containers, which were delivered weekly.
TFG structured a revolving purchase facility of £500,000+ VAT, allowing a crucial bridge between the payment of their suppliers and the raising of debtor invoices. This trade finance facility assisted a fast growing business with a sudden change in their supply chain and buying patterns.
Nikhil Patel, Analyst in the Trade Finance team at TFG said: ‘…consumers are increasingly putting pressure on corporates and retailers to be accountable for sustainable supply chains and to reduce plastic packaging. At TFG, environmental and sustainable governance (ESG) is at the heart of our business. We were delighted to structure this innovative facility, which helped bridge the gap between payment to the supplier and raising of the debtor invoice to a UK business. We hope to continue working with this business and also our funding partners to support the long term sustainable growth which is also in line with the UK’s sustainable development goal’s commitment to net zero emissions by 2050.’
This was an excellent opportunity to work together with TFG who really understand trade finance and made the whole process run smoothly.Andy Beck, Managing Director at White Oak IE
Andy Beck, Managing Director at White Oak IE said: “We are delighted to provide a £500,000 revolving trade finance facility to support this fast-growing creative packaging company, which has an excellent track record of delivering high quality product into the food and beverage industry. This was an excellent opportunity to work together with TFG who really understand trade finance and made the whole process run smoothly. We look forward to continuing to support the growth of our client and other prospective clients with TFG.”