In the competitive world of commodities trading, maintaining a steady cash flow is essential for seizing new opportunities and managing everyday operations. With the pivotal advice and introduction by a commercial finance broker, Octet Finance supported a thriving business in the commodities trading and logistics sector, helping them overcome financial challenges and achieve sustained growth.
Identifying the financial challenge
Established in 2008, this business has steadily grown to become a leading player in the international trading of various agricultural commodities, as well as recycled paperboard, packaging and scrap metals. Their operations handle approximately 200,000 metric tons of grains, pulses, and oilseeds for export markets annually. With a robust procurement model that ensures full traceability from farm to mill, they have established long-term supply contracts with farmers and leveraged third-party warehousing in key port zones across Australia. This setup allows them to reduce costs and offer competitive pricing to customers worldwide.
Despite their success, the business faced a significant challenge: managing the cash flow required to support their rapid expansion. Their existing trade finance facility, provided by a more traditional financier, was no longer sufficient to meet their growing needs. They required additional working capital to continue their growth trajectory and maintain their competitive edge in the market.
Recognising the need for expert advice, the business turned to a trusted commercial finance broker. The broker, well-versed in the financial intricacies of commodities trading, quickly identified that the company’s existing financial arrangements were insufficient for their expanding operations. Understanding the business’s goals and financial structure, the broker recommended considering working capital finance as a solution to their cash flow issues.
The broker then introduced the company to Octet, who provided a tailored financial solution which proved to be a game-changer for the business.
Formulating a tailored financial solution
In considering the operational requirements of the commodities trading sector, Octet identified the need for a customised finance solution, providing the business with a $1m trade finance facility, specifically designed to address their working capital requirements. This facility enabled the company to manage their cash flow more effectively and seize new business opportunities without the constraints of limited funding.
Octet’s approach was not just about providing capital; it was about understanding the business’s unique needs and challenges. “By working closely with the company’s leadership, we tailored a solution that aligned with their operational model and growth ambitions,” says Brendan Green, Octet’s General Manager of Working Capital Solutions.
Transforming operations with additional capital
The injection of working capital from Octet had an immediate and transformative impact on the business. The trade facility was then increased to $4m to support its overall procurement requirements with a strategic supplier. The additional capital allowed the company to increase its acquisition of commodities, ensuring they could meet the growing demand from their customers. This expansion was crucial for maintaining their market position and continuing their growth trajectory.
With the flexibility provided by the financing, the business could manage its cash flow more effectively. This enabled them to pay suppliers promptly, secure better terms, and avoid the pitfalls of delayed payments that could disrupt their operations.
Improved cash flow and additional working capital also empowered the company to explore new business opportunities. Brendan adds, “They were able to enter new markets, diversify their product offerings, and establish stronger relationships with suppliers and customers alike.”
Additionally, the financial support from Octet strengthened the company’s overall financial stability. This was particularly important in a volatile industry where market conditions can change rapidly, and having a stable financial base made all the difference.
Planning for a prosperous future
The partnership with Octet marked a turning point for the business. With their immediate working capital needs addressed, the company could focus on strategic growth initiatives and long-term planning. They continued to leverage Octet’s expertise and financial solutions to navigate the complexities of international trading and maintain their competitive edge.
The role of the commercial finance broker was also instrumental in this success story. By understanding the business’s challenges and introducing them to the right financial partner, the broker facilitated a crucial connection that enabled the business to thrive.
Today, the business stands as a testament to the power of strategic financial support. Their story highlights the importance of having a financial partner who understands the unique challenges and opportunities of their industry. With Octet and their broker by their side, the business is well-positioned to continue its growth journey and achieve even greater success in the future.
Grow your business with Octet
Via our Referral Partner Program, Octet empowers businesses across a range of industries, including wholesale, manufacturing and transport, offering innovative Trade Finance and Debtor Finance working capital solutions.
Speak to our team of working capital specialists to see how we can power your business growth today.
Disclaimer: These comments are only our views and should not be construed as advice. You should act using your own information and judgment. Although information has been obtained from and is based upon multiple sources the author believes to be reliable, we do not guarantee its accuracy, and it may be incomplete or condensed. All opinions and estimates constitute the author’s own judgment as at the date of publication and are subject to change without notice.
