Paper represents your major cost of sale and your major trade supplier.

....but we all know credit terms for paper stock domestically are tight ....and likely to get tighter with the continued credit crunch and the looming threat of recession.

...and we know that imported stock can be a nightmare - with the potential cash flow implications of tying up your cash for three months through importing stock only made worse by the $US having gone against Aussie Printers.

That is why Cash Stream Financial and Print Finance are working together to adopt a proactive approach to helping printing companies with their financing and cash flow.

Cash Stream Financial specialise in cash flow finance and have a variety of different options to helping improve your cash flow - through the use of debtor finance and stock finance. One particular facility Print Finance and Cash Stream Financial think is particularly useful for the printing industry is that of UNSECURED stock finance for use with your domestic paper suppliers:

 

	How it works
	Security required
	Advantages
	Disadvantages
	Costs
	Initial Credit Criteria

 

If you have any queries please do not hesitate to contact Tim Lea at Cash Stream Financial on 1300 79 30 60 or email him at tim.lea@ cashstream.com.au.We also have many other cash flow options to consider for your printing business - so if you find the unsecured facility is not appropriate why not call us about other options we can consider for you - after all that's what we are here for - to help you be more successful, and to help you improve your cashflow.

Release up to 90% against your outstanding invoices - NOW!

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Here's how it works:

	Unsecured Stock Finance

 

• The supplier ships product to the you and raises their invoice in the usual way
• On Day1 the inventory Financier pays the supplier directly on behalf of your business.
• The supplier gives you an early settlement discount to the client company – usually 2%-4%
• The client company re-pays the inventory financier on day 60
• This can be extended to up to 120 days (at additional cost)

 

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The security required for this facility :

 

• This facility is UNSECURED - it is repaid through the cashflow of the business itself
• There is NO fixed and floating charge put in place
• There is NO security over real estate
• A Personal Guarantee, however, will generally be required from the directors of the business.

 

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The Advantages of the facility:

 

• The facility is unsecured
• It does not directly interfere with existing secured lender’s lending arrangements (dependent upon interpretation of facility it MAY affect interest cover covenants)
• Potentially self-funding through early settlement discounts
• Ideal for seasonal peaks and one-off purchases e.g. distressed stock
• Flexibility - You can use it for all or any of your suppliers (subject to your credit limit with the inventory financier) and you can even select individual supplier invoices

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The Disadvantages of the facility:

 

• Because it is high risk finance as it relies upon the cashflow of your business to re-pay the facility, the financier will closely monitor your financial performance and underlying cashflow.
• Additional paperwork involved, and supplier will know of funder’s involvement.
• Weakening in financial performance/cashflow may lead to reduced facility.
• Only available to fund new stock purchases – i.e. existing stock will not be financed.

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The costs of the facility

 

The costs of this facility can be self-funding

• You will typically pay 2.5% -2.95% for the initial 60 day period
• Any time after the initial 60 day period you will pay an agreed annual % interest - somewhere between 12% - 14% per annum
• If you can negotiate supplier discounts for early payment (say 3%)- the facility would effectively cost you nothing.....

Please note : this facility is new to the marketplace, as part of an import financier's offering - so rates may increase as more companies adopt the facility and the credit crunch becomes tighter.

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Initial credit criteria

 

Stock finance is high risk finance as the financier is re-paid only out of the cash flow of your business and has no back-up security. In order to qualify for the unsecured stock finance your business needs to be trading profitably and well controlled. Please get in touch with Tim Lea at Cash Stream Financial to discuss the specific criteria the financier requires on

1300 79 30 60

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