Tradewind has announced the closing of a US$6m export factoring facility for a seafood processor and exporter based in China.
The company sells to large wholesalers and distributors located around the world and is directing Tradewind’s funding towards operating expenses and the fulfillment of orders. With the facility in place, the company is better positioned to explore new markets and to better face the risk of additional trade tariffs.
Jason Wang, VP of sales for the Tradewind Shanghai office, said: “We are pleased to provide financing for another client in our expanding seafood portfolio. Our financing has enabled the client to execute a strategy to minimize foreseeable trade tariffs and complete orders on time while exploring new territories.
“Tradewind’s global services can benefit more companies of this kind by reducing financial pressure and optimizing the operation procedure in a changing international trade environment.”
Limited liquidity
While the seafood processor had experienced significant growth in profitability and trade volume in 2017, liquidity remained limited: more than 80% of its balance sheet was comprised of accounts receivable and inventory, with cash flow strained by a long turnover time. After investing in a new project whose maturity date was longer than expected and that depleted funds for production, the company faced a liquidity gap.
Tradewind resolved the company’s shortage in cash by purchasing its accounts receivable and funding it upon delivery to the company’s buyers. With Tradewind’s assistance, the company is expected to fill the liquidity gap within a couple of months.
