Vethy dealer inventory and cashflow model — financial planning for distribution partners

• Table of Contents

1. Recommended inventory turn benchmark
2. Working capital planning
3. Payment terms and credit framework
4. Demand-driven restocking practice

Distribution partner profitability depends as much on financial discipline as on technical execution. Vethy supports partners with a clear inventory and cashflow modelling framework — covering recommended inventory turn, working capital, payment terms and demand-driven restocking practice.

Recommended inventory turn benchmark

Target inventory turn 6–8x annually for finished units and 4–6x for spare parts. Below 4x indicates over-stocking or weak demand; above 10x indicates under-stocking with stock-out risk. Benchmark varies by territory maturity and dealer tier.

Working capital planning

Working capital tied to: finished-unit inventory, spare-parts field stock, warranty reserves and customer receivables. Typical Authorised Dealer working capital USD 50,000–120,000; Premium Dealer USD 150,000–400,000; Master Dealer USD 500,000–1,500,000.

Payment terms and credit framework

Standard payment terms: 30 days from invoice for Authorised Dealers; 45 days for Premium and Master Dealers. Early-payment discount 2% for payment within 10 days. Credit limit established at onboarding, reviewed annually.

Demand-driven restocking practice

Restocking based on rolling 90-day demand pattern with seasonal adjustment. Vethy dealer portal demand-forecasting tool helps optimise reorder timing. Avoid impulse over-stocking against promotional pricing — long-term cashflow cost exceeds short-term discount benefit.

Frequently asked questions

What inventory turn should I target?

6–8x annually for finished units; 4–6x for spare parts. Adjust based on territory maturity and seasonality.

What payment terms apply?

30 days for Authorised Dealers; 45 days for Premium and Master Dealers. Early-payment discount 2% for 10-day payment.

How much working capital do I need?

USD 50,000–120,000 for Authorised; USD 150,000–400,000 for Premium; USD 500,000–1,500,000 for Master Dealer. Varies by territory and product mix.