"MH" Financing For Small Partners

OTB, the Italian fashion group, announced that it would implement the "cash" (full name credit agevolato suppliers' help) project in all its subsidiaries. The project was first introduced in 2013 to provide financial support for enterprises belonging to the OTB Group supply chain. The original beneficiaries of the cash project were suppliers of staff international, a clothing manufacturer under the OTB group. They were authorized manufacturers and distributors of dsquared, just Cavalli, Vivienne Westwood and Koch é brands, and were also responsible for the supply chain of Marni and Maison Margiela brands.

"In 2013, we launched the cash project because we realized that many of Staff International's suppliers and small and medium-sized enterprises in Italy would have difficulties in obtaining loans, or the loan terms were extremely harsh," UBALDO Minelli, OTB's chief executive, said in an interview. For our business model, having a supply chain in poor financial condition is a huge risk. As a result, we have applied for and obtained a 50 million euro credit line, giving priority to suppliers with appropriate requirements and operating healthily. "

On Monday, OTB said it would extend the cash project to the entire supply chain of all its brands, including diesel, Viktor & Rolf, Amiri and brave kid, the children's wear division.

OTB group has given three requirements for participating in the cash project, but none of them involves financial issues

Performance and quality: including order fulfillment, delivery time and quality standards

Partnerships: involving the reliability of documentation and information processing

Compliance and Sustainability: environmental and corporate social responsibility certification (CSR) and the implementation of sustainable development projects

Suppliers participating in the cash project can ask the banks concerned to pay their invoices to staff international in advance. Through a very simple operation procedure, the invoice will be paid within a few days.

UBALDO Minelli added: "this relationship exists between the bank and our suppliers, we are not acting as intermediaries, we just pay the bank when the invoice is due. Our suppliers are free to choose whether and when to turn to the cash project. The programme has had positive effects at many levels. In 2013, staff international had 450 Italian suppliers, of which more than 50% were eligible to participate in the project. Now we have 853 suppliers, 743 of which are in Italy, and more than 80% of them are in good condition. In addition, over the past few years, some of our supply partners have managed to negotiate better terms with their own banks, and they don't want to lose their customers. "

The company will expand all of its existing subsidiaries to 853 international staff suppliers. "Staff International is the company with the highest volume of purchases (within OTB), with an annual purchase value of 200 million euros, 90% of which takes place in Italy," UBALDO Minelli said. By opening the cash project to Italian suppliers of all the group's subsidiaries, it is expected that a further 70 million euro worth of procurement will be added. We are also considering extending the program to some foreign suppliers, and we are evaluating the feasibility of the scheme. "

Six years since the launch of the cash project, more than 210 million euro loans have been provided, including 50 million euro in 2019 alone.