Plugable set out to make the best consumer electronics for their customers by offering the highest-quality technology and customer support. Their products—docking stations, hubs, and USB cables—enable more ports, power, and screens for the everyday employee, supercharging productivity and connectedness.

At the onset of the COVID-19 pandemic, the paradigm of commuting to work became old news. Working from home was here to stay, prompting a growing demand for technology products that could support these home-office setups. For an electronics accessories company like Plugable, the demand was quickly followed by challenges in staying in stock and getting products to customers, amidst the supply chain crisis that was unfolding.

Nico Fedrigo, Finance Director at Plugable, knew the company needed more cash to offset these delays and stay in stock, and partnered with a mainstream lending program to help finance some of their capital needs. But they quickly found they needed more cash. Flexport Capital—a financing tool that provides companies quick access to working capital financing free from complex fee structures, onerous documentation, or multi-month diligence processes—checked all the boxes for Plugable, a small inventory-driven company with less access to working capital.

“We really took advantage immediately,” Nico noted, “Because if we used Flexport Capital, we realized we could fuel our business by putting more inventory in our warehouses and more money into our logistics operations. We are growing double-digit year over year now and that is driven by more variability provided by having more capital.”

Overcoming inventory shortages and supply chain mishaps

Throughout pandemic-induced supply chain disruption and shortages, Plugable noticed that its inventory supply came in waves. Prior to the pandemic, routine Proof of Shipment (POS) documents, which certify that an order has been dispatched and it is on track to the correct recipient, were never a point of contention between vendors and their customers, but as the pandemic swept the nation, POS documents were frequently being mishandled, causing vendors to stop delivery for months. “It was very stressful for our cash flow,” Nico commented, “Flexport Capital’s flexible finance solutions gave us the opportunity to absorb those peaks of supply.”

The additional working capital offered through Flexport Capital is directly tied to Plugable’s company growth, which is largely impacted by the Integrated Circuit (IC) chip market. So, when their suppliers have stock availability, their first move is to buy up as much of that inventory as possible in order to keep production moving. “We were in and out of stock all the time,” says Nico. “We took advantage of Flexport Capital to fill our warehouses and realize an increase in business.” Since Plugable’s inception, Flexport Capital has tripled Plugable’s line size, which means the business can capitalize on the availability of IC chips after long stretches of stockouts.

Plugable understood that growth comes through either selling large orders of one product or introducing smaller batches of new products. The company opted to pursue the latter to redirect unsatisfied demand and follow the rapid cycles of the electronics market. For their team, that meant targeting 20-30% of new product introductions each year. “We used to buy more inventory for each new product every month,” Nico added, “There was a time where we didn’t know if we'd have enough inventory to match our sales, creating significant strain on our cash flow. Flexport Capital remedied that pain point.”

The increased credit line was especially critical during the pandemic, when delivery times became increasingly delayed and unpredictable. Fedrigo noted that “We pay for products before even having them on hand, so the longer transit times took, the longer it took for us to realize revenue. Having cash to pay both the invoices on products and other operating expenses was a huge relief on our books.”

So far in 2023, Plugable is pacing to increase its payments to vendors by 47% with Flexport Capital, enabling them to achieve their YoY growth goal of ~20%..

Insight turns challenges into opportunities

By working in the Flexport Platform, Plugable can detect signals of market shifts and respond with a focused strategy. Real-time shipment tracking allows the company’s leadership to compare transit times and drill into the cause of delays, like when purchase orders take longer at the origin. Detailed line items support close analysis of landed costs by shipment or down to individual SKUs, which unlock cost and speed signals that allow Plugable to turn challenges into opportunities.

Fedrigo credits the relationship between Plugable and Flexport, saying, “We’ve experienced a lot of innovation with Flexport. Working with Flexport is like working with a colleague. There's greater synergy, and Flexport is always super responsive.” The agility within the partnership enables Plugable to discover opportunities and capitalize on them before they pass. Access to Plugable’s shipment data allows Flexport Capital’s terms to align more appropriately with Plugable’s revenue cycles. The result is reliable growth, even through challenging times.