How Selency improved WCR by 15 days thanks to Defacto supplier financing

About Selency

Selency is a platform to buy and sell vintage furniture and second-hand decorative items, offering a unique selection for flea market and decoration enthusiasts. We also have a professional (B2B) offering for interior decoration support for offices, restaurants, and hotels.

As the Head of Finance at Selency, my main role is to oversee and lead all financial activities of the company, ensuring financial health and devising strategies to achieve our growth and profitability goals. I’m also responsible for HR and administrative management and collaborate closely with executive leaders.

Selency’s growth objectives

For the next year, our main objective is to focus on profitability and strengthen our position in the market. 

We’re also committed to improving the satisfaction of both sellers and buyers by providing the best customer experience, particularly at the checkout.

The finance team & tools at Selency

I’m the Head of Finance, working with two specialised finance analysts. One focuses on our B2C finances, particularly on platform payments management, cash flow, and accounting closure. The second is focused on the B2B department, particularly on receivables management, billing performance analysis, and monitoring the profitability of B2B projects. 

We use enterprise financial management tools to ensure our daily financial operations are efficient and accurate, as well as producing good financial reports. Pennylane is a core part of our finance stack. ‍

The challenge: gaining strategic control over working capital

In our approach, we focus on optimising our working capital requirement (WCR). To achieve this, we need to: 

• Maximise supplier payment terms
• Accelerate cash collection

The aim is to strengthen our cash flow, improve financing for our growth projects, and enhance our competitiveness in the market.

Previous financing hurdles

Our customers are the primary contributors to our finances. Therefore, it’s imperative that we effectively control the invoicing and collection process, especially for our professional buyers.

Thus, we focused our efforts on:

• ‍Managing the invoicing cycle, including advances and collection, with the goal of improving cash collection
• ‍Extending payment terms with our suppliers
• ‍Managing disputes and collections to further optimise our financial operations

The solution: short-term financing with Defacto

Put simply, Defacto allows us to cash in and cash out whenever we want, any time we need to. This is a great source of security and comfort in financial management.

And it's fantastic to be able to do everything from our Pennylane interface, without juggling between multiple tools. We click two buttons and it's done.

4 key advantages

The advantages in using Defacto are numerous. But I would highlight these four:

• Quick setup: Getting started with the platform was immediate and instantaneous, allowing us to quickly start benefiting from its features. 
• Optimised WCR: We noticed an immediate impact on our WCR cycle, thereby contributing to improving our overall financial management.
• Clear pricing: We appreciate the transparency regarding fees, which lets us better anticipate and manage our financial costs.
• Easy integration: The integration of Defacto into Pennylane was smooth and straightforward, providing an effective alternative to traditional banking processes. 

“Significant” performance & efficiency gains

The impact of Defacto on our financial performance and our team's efficiency has been significant.

For example:

• We gained 15 days of working capital requirement by extending our supplier payment terms while maintaining good business relationships.
• We can accelerate our B2B offering without our WCR being a hindrance. Today, managing a project has a WCR impact of approximately €25,000 on our cash flow. Thanks to Defacto, we can easily respond to demand without holding back.

The Defacto experience in 3 words

The three words I would use to describe Defacto are:

• Transparency: No unpleasant surprises, and total visibility on financial transactions.
• Speed: Enables efficient cash flow management.
• Comfort: Provides a sense of security in cash management.