As a leading innovator in footwear design and manufacturing, Portland, Ore.-based KEEN Inc. was a major supplier to traditional brick-and-mortar retailers. When online merchants began to explode and threaten the existence of these retailers, KEEN found itself with a retailer customer base that was struggling financially and at risk of failing.
By 2016, KEEN was facing an increasingly unpredictable marketplace. Yet, even as confidence in its customers’ ability to pay ebbed, the company still had to maintain its flow of orders to maintain sell-through—its own and that of its retailer customers. With weeks-long lag time involved in shipping from factories to distribution centers to individual retail stores, retailers require terms, typically 30 days and occasionally 60, that allow them time to pay for product and sell it without any interruption in inventory. However, as formerly strong-performing retailers began underperforming with some also carrying a heavy debt load, continuing to grant these terms created significant risks for KEEN.