Bloom: Working capital gaps cause cash shortages during rapid retail growth
Sahil Bloom · The Laws of Community Building with Natalie Ellis · Sep 22, 2022 · at 13:31
Investor and creator Sahil Bloom discusses the cash flow pitfalls of physical product businesses and delayed wholesale retail receivables with Natalie Ellis.
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“You see a whole lot of businesses go under because of that exact dynamic. Like you're, you know, you're paying your producers so far in advance of when your retailers are paying you. It's like, you know, a terrible dynamic to have to deal with when you, especially when you're growing, it hurts you the most when you're growing. So you think everything's going well. And suddenly you realize you have no cash left in the bank because you paid all your manufacturers way out in advance of when you're due to be paid.”
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