“In practice, young companies need to assure a gross margin greater than or equal to 30%, to guard against all risks and solidly finance their development,” François Rossignol concludes.
Well-known in the fashion business, Webhelp Payment Services and Lea Trade Finance have been in partnership since 2015 to propose their combined services to 2 types of company:
– small companies, recently created and growing fast;
– mid-sized companies, which are still growing or which have reached a development plateau.
These services concern cash flow and are proposed end-to-end, i.e.: from Purchasing (cash outflow) to Sales (cash inflow).
“The idea is to outsource completely the cash flow problem, and entrust it to specialised players,”, explains François Rossignol, founder and CEO of Lea Trade Finance.
In concrete terms, this means the Purchasing / outflow aspect being handled by Lea Trade Finance, and the Sales / inflow / collection aspect by Webhelp Payment Services.
“We provide a financial solution that is simple and quick to implement for companies encountering difficulties. This prevents them from having to fall back on other well-known solutions, but which are more complex, risky or unsure, such as increasing capital or taking on bank loans, completely unsuited to their immediate needs,” Mr. Rossignol adds.
This allows the client companies to extricate themselves from a tricky situation, so that they can procure their supplies, deliver to their clients in timely fashion, issue their invoices, get paid within a reasonable period, etc.
“The outsourcing of cash flow issues allows fashion companies to generate sufficient margins to grow or maintain their business level, with total peace of mind, and while remaining focused on their core business,” says François Rossignol.
Many international fashion brands, including some very well-known ones, make use of this type of service.
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