A business in Southern California had to carefully manage cash flow during the first three years as it started up and sold products to retail stores in the United States and eventually Canada.
The company didn’t pay cash or incur debt to purchase and stockpile inventory in the start up phase.
“When we started, we started with very little money,” said Jason Carr, co-founder of Softline Home Fashions with brother Rodney Carr.
Softline Home Fashions, located in Gardena, just south of Los Angeles, imports quality polyester fabrics and sells to independent retail outlets and mass merchandisers.
He told me how they started generating their initial cash flow: “Some guy would have a stock lot and we’d go and re-sell it to generate capital. We started taking trips to China to buy more of a regular running line.
“We used factors. People take a certain percentage of the invoice and they collect on receiveables paid to them.”
Financing the start up for So
ftline Home Fashions required a careful strategy of showing samples to the retail outlets, determining which fabrics were going to sell, and then requesting the fabrics from suppliers in China and Indonesia. The product was then shipped and sales made to the retail outlets and then the suppliers were paid.
Jason Carr, co-founder of Softline with brother and business partner Rodney Carr, told me they’re grateful to the suppliers who allowed flexible financing arrangements.
Softline Home Fashions’ today has a large warehouse with 75 employees at its Gardena, California operations with immediate shipments to customers. The company also has offices in Atlanta, New York and operations in Canada.
Click here to read more on how Softline got started shortly after the tragedy of 9/11 in 2001.
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