Fragrance Manufacturer Launches Into Big Box Retailers

The Situation

A rapidly growing fragrance manufacturer had an opportunity to expand its sales into big box retailers, like Walmart, Target, and Costco, but needed capital to produce inventory to meet projected new channel demands. The company, having experienced success primarily through television sales, was now looking to expand into the big-box retail space and accelerate its already fast-paced growth.

To achieve this expansion, the company was in the process of working to increase its senior lending facility, but it needed to fulfill purchase orders in the immediate timeframe. The company’s senior lender contacted National Business Capital to explore subordinated debt solutions that would enable the client’s growth without adding risk to the primary lending relationship.

How We Helped

In just 13 days, National Business Capital’s team collaborated with the client and their senior lender to form an inter-creditor agreement and establish a $10MM subordinated credit facility to achieve the company’s short-term goals. The company drew $5MM, leaving $5MM in reserves for future liquidity needs.

The capital injection covered the client’s existing over advance, which brought our partner to a more risk-tolerable position.

Where They Are Today

The company can now pursue new revenue streams with extensive growth capital. Their launch into big box retailers projects to compound the company’s already rapid growth with major revenue gains.

The solution also complements the senior credit facility by reducing overall risk and allowing the lender to retain an important, growing client relationship.