#SalesStrategies: How cash flow management solutions can increase sales potential

In our #SalesStrategies series, we’re exploring the real challenges B2B sales leaders face and sharing sales strategies that can help solve them. Check out more articles like this one here.  

As a business development manager for Commercial Finance at DLL, I work closely with our manufacturers and dealers to create cash-flow-positive solutions that can help reduce business risks, increase purchasing power, and support business expansion. I specialize in understanding my partners' business goals, predicting the challenges they may encounter, and offering financing solutions, like credit lines, designed for their unique business needs.

Market challenges

Given the tumultuous macroeconomic landscape— there are three significant challenges my partners are currently seeing in the market.  

1. Their cash reserves are depleting faster, resulting in difficulties in cash flow management,  
2. Their lead time for incoming stock is increasing, and, 
3. They are also seeing an increase in their stock turn duration. 

Supply chains all over the world are impacted and challenges around cash flow, stock turn, and incoming stock lead time, if not addressed in time, could lead to a severe impact on businesses by increasing their financial exposure risks. 

Overcoming challenges

We cannot control the global supply chains or the macro environment setting them in motion. However, at DLL, we have advanced floor planning solutions that can address these challenges. We work with our manufacturer partners and their dealers to set up floorplan financing programs to help move more stock into the market, faster. 

For example, a construction equipment manufacturer we partner with in North America and Europe wanted to expand their business to Australia and New Zealand. Moving into a new market can present many risks and unknowns. With DLL having local market expertise in 25+ countries, including Australia and New Zealand, we were in a strong position to help them achieve their business goal. We partnered with them to create a floorplan agreement with “pay-as-sold" terms for their dealers, including interest-free clauses for up to 90 days on their stock purchases. In this case, the manufacturer subsidized the interest costs to support their dealer network. 

There are some significant benefits to establishing a floorplan agreement, both for manufacturers and their dealer networks: 

• Manufacturers may receive their payments as early as Day 1 of invoicing, which reduces their inventory/stock financial exposure risk with their dealers while driving growth goals. 
• Dealers gain greater flexibility, paying for their stock over time relative to stock turn. This reduces their own cash flow strain and business risk. And this increases purchasing power and sales and market expansion potential.