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Inventory Inspection Payouts Corroborated by Third-Party In-Person Inspections

Posted by Sean De Clercq on Tuesday 26 Sep 17
With the release of our new Inventory Inspection 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 for Inventory Inspection (II) co-ops, Kickfurther relies on two sources.
1.) Bi-Weekly, Self-Provided, Business Reports
The funded business will report SKU by SKU sales and is invoiced by Kickfurther. Based on the number of units shipped reported by the business 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.
2.) Monthly In Person Inventory Inspections
Kickfurther will retain an in person inspection service to verify inventory levels at the business warehouse when the inventory arrives and at minimum on a monthly basis thereafter until completion of the Co-Op. Any discrepancy between the inspected inventory and the report will be invoiced immediately. 
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 in excess of the option price in order to prepurchase remaining consignment inventory. 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.

A visual breakdown of how Kickfurther brands invoices are created

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


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.

Any discrepancy discovered during an inventory inspection will result in Kickfurther producing an additional invoice due for the inventory missing. 


Topics: Kickfurther News, Updates

Posted by Sean De Clercq on Tuesday 26 Sep 17
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