Categories: Case Studies

Author

Andy Cagle

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In 2022, Revere Plastics Systems CFO Brad Frederick and his colleagues began the process of revamping the way the company approached its working capital management. They had been introduced to several supply chain finance programs through their customers and were interested in creating their own buyer program to help strengthen their working capital position and further partner with their supply chain.

“As a supplier, we have participated in some of the larger programs sponsored by our customers,” said Frederick. “But what we found was that those were tailored to more substantial enterprises. As a private equity portfolio company with revenues closer to $250 million, we needed a supply chain finance program that would scale to meet our needs and the more traditional players weren’t a fit.

“We were looking for a more white-glove experience that would be more aligned with the needs of a medium-sized company, emphasizing customer service, attention, and flexibility.”

That’s when Frederick and Revere found LSQ.

Serving the Whole Supply Chain for Greater Impact

While many supply chain finance providers focus on the largest suppliers of large enterprises, LSQ’s willingness to support the mid- and long-tail of the Revere’s supply chain provided Frederick with exceptional flexibility and greater ability to maximize working capital.

“We have a number of small-to-medium sized partners in our supply chain, and to have any real working capital impact with a supply chain finance program, they had to be included,” said Frederick.

And so far, the impact has been there for Revere’s working capital position. As part of the implementation of the program, LSQ helped Revere standardize and optimize its supplier payment terms, which allowed Revere to hold on to its cash longer.

According to Frederick, Revere had realized a $4 million working capital lift as of November 2023 and are still working to onboard additional suppliers. “We’ve rolled it out to our larger suppliers, but haven’t rolled it across our entire supply base yet,” said Frederick. “We have really taken an incremental approach out of respect to our resources and staff.”

Once full implementation is complete, Revere expects to see double that $4 million number through complete terms standardization. To increase their working capital lift, Revere also takes advantage of LSQ’s FlexTerm offering, a pay-later solution that allows the manufacturer to push repayment to LSQ beyond the old or standardized invoice due date.

Payable Efficiencies Through LSQ FastTrack®

Frederick jokes that Revere has an accounts payable team of 1.5 people consisting of/lead by Corporate Controller Barb Zeitz. As a result, implementing any new system, especially one the magnitude of a supply chain finance program, has to be not only simple to implement but provide operational efficiencies.

“We have learned a lot over the past two years,” said Zeitz, “and have worked with the LSQ team to get the most out of FastTrack to help us better manage our payables. We had some trouble with some of the reports we needed to run, but (customer success manager) Kathy (Waskowsky) and (VP of Strategic Project Development) Kelly (Marsh-Dixon) have been great at helping us get what we need. I have definitely gotten more comfortable with FastTrack and it helps us manage some important parts of the payables process.”

A “Real Viable Option”

Revere is a company that is on a growth path; a path that requires liquidity.

“LSQ has provided us with a creative way to improve liquidity and assist in our growth path,” said Frederick. “But even for other companies that aren’t in growth mode, there is also a need for liquidity. Whatever the reason, I would say LSQ certainly provides a real viable option that people don’t always think about when considering cash flow.

“A lot of people just think about going to the bank and looking for a line of credit or something similar, but this is a nice and creative way to enhance liquidity.”

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