CarePlus is a Sydney-based online exporter of Australian food products and health supplements to China.
Founded in 2011, CarePlus was established as an export business to satisfy the demand for premium Australian health products from the increasingly affluent Chinese middle class.
The company exports vitamins and supplements, baby formula and personal care products sourced from well-known Australian suppliers.
CarePlus has taken advantage of the recently signed free trade agreement (FTA) between Australia and China to significantly grow its business.
The FTA has made it much easier for Chinese customers to purchase Australian products and has led to a strong boost in sales.
The company operates via an e-commerce platform owned by Alibaba, one of the largest global e-commerce companies connecting Chinese buyers and sellers.
Cash flow challenges
As an online exporter with limited presence in the market, strong customer service throughout the order and delivery process is critical to customer satisfaction.
This requires a large amount of stock to be purchased and warehoused at all times, in order for CarePlus to fulfil all orders in a timely manner, however this can put pressure on the company’s cash flow.
With a significant proportion of cash flow tied up in inventory, as well as suppliers often requiring payment in advance of goods being dispatched, CarePlus had a need for additional working capital to fulfil its growing orders.
While CarePlus’ bank was supportive of the company’s future growth plans, the bank was unable to approve further finance but suggested that CarePlus talk to us to find a solution.
How we helped
We were able to provide a $300,000 export working capital guarantee to CarePlus’ bank, allowing the bank to approve the funds CarePlus needed to fund its expansion.
This facility will allow CarePlus to prepay stock and freight costs associated with its rapidly increasing pipeline of orders.