Temporary working capital

A flexible financial partner for growing private labels

As small and medium-sized businesses plan for their future, they can find themselves between two worlds: they are no longer fueled by federal funding at the peak of a pandemic or buffered by PPP loans, but still have to deal with financial problems. supply chain and the added headache of inflation; managing a team rather than overseeing every operational detail on their own, but still nowhere near as big as the brand name competitors dominating the market. For smart, secure expansion and a steady flow of capital, what’s next for a business?

To promote growth at a healthy pace while protecting their bottom line, burgeoning manufacturers and wholesalers of furniture and housewares deserve a trustworthy lending partner with the experience and deep pockets to scale. whole new challenge. Family business of factoring and financing Rosenthal & Rosenthal benefits from a decades-long legacy of supporting home-based businesses, ensuring their credit stability so they can focus on the manufacturing, warehousing and distribution of their core product, whether that be household items, textiles or furniture. For strategic financial services minus the bureaucracy that’s often unavoidable with big bank financing, it’s the perfect match for businesses with at least $2 million in annual revenue.

“Traditional banks tend to be more restrictive and regulated in their policies, but as a private lender we are able to set our own credit guidelines which allows us incredible flexibility,” says Joel Wolitzer, senior vice-president of business development for the firm, which specializes in the home goods sector. “Even if a business is in temporary financial difficulty, we look at the overall security, the big picture, as opposed to a one-time snapshot of profitability.”

“We can keep the relationship fluid so that if something goes completely wrong with the formula in the short term, the music doesn’t stop; the customer does not have to stop production and rework an entire credit facility. Often in these situations a suitable solution is quickly agreed upon between the customer and the account manager and the Rosenthal account team,” says Brian Resuteksenior vice president of business development, which focuses on the furniture category.

Founded in 1938, Rosenthal is the largest privately held factoring, asset-based lending, purchase order financing, and direct-to-consumer inventory and e-commerce financing company in the United States, and brings eight decades of perspective with each new customer relationship. Having not only witnessed, but weathered every market cycle imaginable, since the Great Depression, Rosenthal balances historical knowledge with a modern agility that allows the firm to tailor its services to each client. With offices in New York, California, Georgia and North Carolina, and a list of customers in the home goods industry, the company is well positioned to provide credit protection on receivables, loans on receivables, inventory financing and more to help home brands manage risk, increase revenue and maintain that elusive trade-off between too much and too little product.

It’s not an easy time to be in home commerce: today’s furniture and homeware brands face changing economic developments on a daily basis, especially as the Industry boom showed signs of slowing. Some may be stuck with excess inventory and struggle to move it; others wonder how to manage different growth rates between divisions. Direct-to-consumer companies are venturing into the retail space for the first time, unsure of the viability of potential customers, while traditional brick-and-mortar brands need to grow their base. Labor shortages persist and inflation has pushed up container and freight costs. Rosenthal helps finance all of these scenarios with its competitive interest rates and flexible payment structures.

At the start of each partnership, Rosenthal analyzes a company’s collateral and ownership in addition to its balance sheets and profitability. Then, it determines a financial program targeted at specific issues. For seasonal businesses, for example, purchase order financing that takes into account supply chain cycles can better withstand inventory fluctuations by lending against receivables that would otherwise go uncollected for 60 to 90 net days, a tactic that eases working capital constraints and creates more liquidity. Alternatively, Rosenthal can lend against existing inventory to meet future orders.

“If our customer is, for example, a textile importer, their goods come here, come into a warehouse, and when the various retailers place their orders, the wholesaler has to ship customers accordingly,” Wolitzer explains. “Because we have the expertise to understand the creditworthiness of these retailers, we offer credit protection to our customer. Think of it as insurance: our customer can be sure that Rosenthal is responsible for paying those customers. When a customer needs to borrow against these receivables before being repaid, Rosenthal also bridges this gap.

What if a customer fails? “With non-recourse factoring, Rosenthal assumes the risk. We reduce that check,” says Resutek. Such exposure to loss is why it is in Rosenthal’s interest to ensure that manufacturers and wholesalers they represent sell their products to reliable retailers with a proven track record of paying their bills.While national chains like Target, West Elm and Williams-Sonoma may grab the headlines, Rosenthal’s customer base in the furniture industry runs the gamut from one or two small stores to these large retailers.”The furniture industry can be very fragmented,” says Resutek. “There are a lot of big mom-and-pop stores across the United States that only has two or three locations, but they are doing good business.A manufacturer in North Carolina won’t necessarily know how reliable a potential new retailer in Utah is, because they don’t have not still sold in that area, but Rosenthal will know, because we already have three or four other customers selling to that same retailer in Utah, and with the corresponding payment history for those other customers to vouch for them . In collaboration with the controller or the financial director of the client company, the firm also supervises the accounting aspects of the transactions, in complete transparency. It is this familiarity with the nuances of the furniture industry that makes Rosenthal such a strong ally for growing businesses.

“From an efficiency perspective, partnering with Rosenthal allows companies to focus on what they do best, whether that’s making furniture or importing cabinetry,” says Resutek. By taking the stress out of available funds and offering flexible terms at reasonable rates, the company allows small businesses to safely take on the risks that will increase their revenue. “Ultimately, when our customers succeed, we succeed,” says Resutek. Now that seems like a good investment.

This story is a paid promotion and was created in partnership with Rosenthal & Rosenthal.

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