I had the great fortune of visiting the Clothes Show Live at the NEC today and what a day it has been!
A friend got be a free ticket, which is fabulous so I thought it was going to be a cheap day, but how wrong was I, not that it mattered because today, I felt like I needed a treat.
There are so many brands and retailers that associate themselves with the British Fashion Scene, so using the Clothes Show as a platform is a fantastic idea, especially for those new brands that want to break into the market.
When you know about about retail, marketing and product manufacturing, you realise how much money is spent on events such as this and how much money goes into product research, production and packaging. Although these companies do make quite a but of cash off the back of these events they need the products in the first place. It is quite common to have products made abroad as the cost is a lot lower.
If the retailer is national and needs huge amounts of products to fill all stores and warehouses, they may consider shipping them internationally, generally with such huge orders, letters of credit will be used to guarantee payment.
This not only happens in retail but is very common in manufacturing.
Letters of credit are required to ensure a client will pay for products shipped across the world.
Another form of funding that retailers may use is factoring, this enables companies to carry on selling, providing services and producing products despite being owned money from clients.
Factoring allows companies like retailers to gain credit wrapped up in invoices which might not be paid for another 90 days. Having the capital means they can move forward and grow, so the next time you purchase a lipstick or new jumper, think about the process it has been through!