Inventory Visibility Payouts Tied to SKU specific 3rd Party Verified Inventory Levels

Posted by Sean De Clercq on Friday 08 Sep 17
 
With the release of our new Inventory Visibility Co-op's we know people want to understand how payouts from these co-ops will work:

Each Co-Op lists a projected timeline the Brand creates limited by actual historical sales revenue. Actual payouts are due on specifically scheduled dates, but amounts are proportional to sales of funded inventory. The size and number of payouts are not expected to directly follow the estimated timeline as true retail is unpredictable. Each payout you receive on Kickfurther represents the cost paid towards the inventory as well as the profit earned on those specific pieces. 

In order to determine these payments Kickfurther obtains access to Third Party Verified Inventory Reports. Based on the number of units removed from the facility and the agreed upon price to be paid per unit an invoice is created and issued with a payment term that is set in the co-op in advance. This payment term will be between 14-60 days. In some cases Kickfurther will receive funds from sales directly and issue payouts to the buyers and the balance to the business.
 
As in previous incarnations of Kickfurther the business agrees to an option price and a revenue share. The option price is the increased cost of the inventory the business will pay you the buyer for each piece. However in order to protect buyers, brands also agree to pay a revenue share from the sale beyond. You can tell which brands have agreed to pay a larger revenue share because they will have a correspondingly low PSC. PSC stands for Percentage Sold for Completion, and it represents the percentage of funded inventory that must be paid for at the agreed upon revenue share price in order to complete the co-op.
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A visual breakdown of how Kickfurther brands invoices are created

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The third party verified inventory report obtained by Kickfurther.
 
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Next, we will indicate on a SKU by SKU basis how many units of funded inventory have been removed during the recent sales cycle. 
 

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Invoices will continue to be generated based on tracked inventory levels until the co-op is completed or the buyers choose to cancel the co-op.  

Businesses will be required to remit payment within their predetermined payment period for the inventory removed or Kickfurther will initiate a stop shipment to prevent any further inventory from being removed.

 

 
 
 
 
 

Topics: Kickfurther News, Updates

Posted by Sean De Clercq on Friday 08 Sep 17
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