The Phone Call Every CEO Dreams Of… And Fears
Picture this: It’s 3 PM on a Tuesday when your phone rings with the opportunity of a lifetime. A major client wants to place a massive order—potentially your biggest contract yet. There’s just one catch: your supplier requires payment upfront, and your current working capital is already committed to ongoing operations.
This scenario plays out across Canadian businesses every day, especially in manufacturing, distribution, and technology sectors. The opportunity is real, the demand is there, but the financing structure creates an impossible choice: tie up all your working capital on one deal, or watch the opportunity walk away.
The Growing Challenge for Mid-Market Businesses
We’re seeing more suppliers demanding upfront payments, particularly affecting businesses generating $1M to $50M in annual revenue. Whether you’re a:
- Manufacturer needing raw materials for a large production run
- Distributor securing bulk inventory for a major client order
- Technology company procuring components for system integrations
- Oilfield services provider funding consumables and subcontractors for big contracts
The challenge is the same: your creditworthy mid-to-large sized customers want your products or services, but the cash conversion timing creates a wide gulf between what you need to pay suppliers and when you’ll get paid.
The Solution: Supply Chain Finance
Here’s where Supply Chain Finance changes the game entirely. Instead of choosing between the big opportunity and operational stability, you or your client can have both—without impacting existing banking relationships or debt covenants.
Here’s exactly how it works:
- You issue a purchase order to Capitally Trade Finance for the required inventory
- Capitally issues a purchase order to your supplier with payment guarantee
- You receive the goods
- Your supplier sends Capitally an invoice and Capitally invoices you for the goods
- Capitally pays your supplier when due
- You pay Capitally based on agreed payment terms—typically after your client pays you
The result? Your supplier gets paid immediately, you get the inventory you need, and your working capital stays available for operations
Perfect for Capitally’s Sweet Spot
Supply Chain Finance is ideal for businesses that fit these criteria:
- Strong balance sheet and income statement
- Bank line is typically maxed out and can’t be increased at this time
- $250K to $2M facility needs for specific transactions
- 20%+ gross margins (minimum 15%)
- Located in Canada
Real-World Applications by Industry
Manufacturing: Raw materials for large contracts but customers pay 30-90 days after delivery. Supply Chain Finance bridges the gap between material costs and customer payments.
Distribution: Caught between supplier terms (pay fast) and customer terms (get paid slow). Perfect for handling seasonal peaks or large customer orders without inventory financing headaches.
Oilfield Services: Strong contracts with oil & gas companies but facing 60-90+ day payment terms. Cover consumables and subcontractor costs while waiting to be paid.
Technology Companies: Component procurement for major system deliveries or hardware rollouts where customer payments come after implementation.
Why Choose Capitally’s Supply Chain Finance
Unlike traditional financing that can take weeks to set up, and unlike other solutions that impact your banking relationships
- Credit-based approval – your strong credit rating is all you need
- No impact on existing debt covenants or banking relationships
- Fast execution for time-sensitive opportunities
- Transparent terms with no hidden fees
- Flexible payment structures aligned with your customer payment cycle
- Local expertise serving Canada
Your Next Growth Opportunity
Don’t let supplier payment requirements become the barrier between you and your biggest opportunities. Whether you’re a manufacturer facing a large contract, a distributor managing seasonal inventory, or a technology company scaling up delivery capabilities, Supply Chain Finance provides the specialized solution you need.
The bottom line: SCF works whether you have existing bank lending relationships or not—it’s designed to complement traditional lending when it exists, and provide essential financing when it doesn’t.
