Cases · Case detail
How a food wholesaler funds its peak stock without cashflow stress
A food wholesaler in North Brabant saw the same thing every season: working capital locked in stock for months, exactly when buying for the peak was due. Inventory finance from SOOF Finance freed that capital up, without running the stock position down. The result: 35% more seasonal buying possible.
The situation
The same squeeze every season
A food wholesaler in North Brabant runs on volume and timing. That is the pattern of wholesale and distribution: capital standing still in the warehouse. Buy large batches, store them, and sell at the right moment. The business grew steadily, but ran into the same wall every year: the peak before the holidays.
"Around the holidays our turnover almost triples," the managing director says. "But to reach that peak I have to buy in months ahead. And that means my money is locked in stock that only sells later. On paper I am healthy, but at the wrong moment I have no cash."
The stock itself was sound and readily saleable. That was precisely the frustrating part. "I literally had value standing in my warehouse, but I could do nothing with it. It sat there waiting, while I needed the money to buy the next batch."
The approach
Stock that is stuck, opportunities that pass by
The bottleneck was not in the selling, but in the timing. "I had to buy in at the moment my money was still locked in the previous batch. For two or three months a large part of your capital just sits in the warehouse. And that happens to be exactly the period when you have to buy for the season ahead."
A bank loan was not the answer. "That is a fixed amount with a fixed repayment schedule. My need is seasonal, it peaks and falls away. I wanted breathing space that moves with my stock. A loan that puts the same burden on you all year does not fit that."
How it works
SOOF funds on the basis of the assessed stock value. How that valuation works is set out in what is inventory finance. "We looked together at what my stock is worth and which part of it is fundable. That percentage was set in advance, so I knew exactly where I stood."
The owner submits a stock list periodically, and on that basis SOOF keeps a live view of the position. The administrative burden stays limited. "It is not a daily chore. I send in my lists, and the rest runs."
Important to him: the stock does not have to be run down. "I free up capital from stock that simply stays in my warehouse. That is exactly what I needed."
The results
ReviewsReviews
What others say
Through working with SOOF, we are strong in more than just foundation work.
The onboarding was well organised. A simple process with fast payment.
We are very satisfied with what they offer, the way they work and the speed of payment. On top of that they think along with us actively and are always easy to reach. The contact is pleasant and professional.
We grow seriously every year, but finding suitable finance for a young business turned out to be hard. From the first contact with SOOF: short lines, pointed questions, quick to move. My feeling straight away was that they understand entrepreneurs here.
SOOF responds to the growing capital need in automotive. Vehicles on their way to their final destination are advanced against efficiently, so that we keep enough working capital to keep growing. Short lines, quick decisions, and a relationship that goes further than the transaction.
Sander
Directeur van een foodgroothandel, Noord-Brabant
"The first time I really noticed what it delivered was just before the holidays. I could buy in fully for the peak, where before I had to ease off halfway because the liquidity had run out."
"What I like: it is predictable. I know which part of my stock I can fund, and the line moves with the seasons. No surprises."
"And it helps that stock and invoices run with one party. One point of contact, one overview. I do not have to juggle three financiers at once."
Frequently asked questions
For SMEs with a substantial stock position. It is not an option for sole traders or one-person businesses.
That depends on the type of stock and the valuation method. We establish the fundable value together and make the percentage transparent in advance, so that you know where you stand.
Then the funding headroom falls with it. You repay the difference. Because we review periodically, you see that coming rather than being caught out by it.
Yes. That combination is common at trading and distribution businesses with large stock and long payment terms. You then keep one point of contact for your whole working capital. The trade-off between the forms is set out in which type of finance fits you.
The situations in our cases come from our own practice. We publish them anonymised: names, companies, amounts and other details have been changed, so that a case cannot be traced back to an individual client. Working capital is client data, and we keep that confidential. A case describes one situation and says nothing about the outcome in your case.
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