Peak Performance Canada Inc.* is a Canadian subsidiary of a European owned sporting and recreational goods conglomerate. Peak Performance imports, wholesales and distributes athletic equipment, footwear and clothing to all major national and independent retail sporting goods outfitters.
Issue
Peak Performance has some 1400 customers and generates $20 million in annual sales revenue. The seasonal nature of these sales and a large customer base results in lengthy outstanding receivables.
Objective
Accelerate receivables to maximize working capital, reduce financing costs, problem accounts, and administration time and cost.
Annual Sales
$20 Million
Annual Financing Cost per 1 day's
Receivables @ 8%
$4,500
Improvement in Working Capital from a 5
day reduction in Receivables outstanding
$275,000
Annual Reduction in Financing Cost
$22,000
Solutions
Automating the receivables process to provide even modest reductions in the average days receivable will produce clear business value. Using Lockbox services to minimize mail delays and collecting funds by pre-authorized debits from regular customers with Scotia Direct can reduce processing time and costs and speed up cash inflows.
