Getting what you pay for: How payment terms and automated invoices help The Psychic Tree to grow
Customer Success Manager
Laura’s store, The Psychic Tree, has been voted the UK’s Favourite Spiritual Online Shop 4 years in a row.
However, Laura sometimes receives incorrect or incomplete orders from suppliers – after she’s already paid.
Hokodo’s trade credit solution helps Laura and her team to ensure they only pay for what they get, freeing up cash flow for marketing and growth.
Meet The Psychic Tree
Launched in December 2017, The Psychic Tree is a UK-based supplier of healing crystals, incense, essential oils and other holistic goods. Since then, the retailer has become a market leader in its niche and was voted the UK's Favourite Spiritual Online Shop in 2018, 2019, 2020 and 2021.
Getting what you pay for
When buying stock for The Psychic Tree, Laura found that she would sometimes receive incorrect orders, or deliveries which were only partially complete.
“I would order from my suppliers online, pay up front, but sometimes only half of the order would arrive, and therefore I'd paid for stock in advance which I was never going to receive. Then I would have to contact my supplier to either locate the missing items or wait to get my money back,” Laura explains.
Using Hokodo’s trade credit option at checkout has spelled the end for such troubles.
“It’s so much better when, if the supplier hasn't got something, they can just amend the invoice. And then, because I’ve deferred payment, I only need to pay for what I've actually been sent.”
Protecting cash flow
Deferring payment with Hokodo also means that Laura and her team are able to order stock and sell it on to customers before having to pay their suppliers, minimising the risk of any potential cash flow issues.
“It's reassuring to know that, ultimately, we're not paying for something until we've got the money back from our customers.”
Laura is a firm believer in the merits of trade credit – for buyers and sellers alike.
“Why wouldn't you use it? I think for me, it's a no brainer. If credit is there, then I always take it. If you use trade credit, it enables you to then reinvest money faster,” Laura says. “And when you're reinvesting money faster, you can go out and buy new products. Therefore, we’re increasing our range, buying more from the supplier and helping both businesses to grow faster.”
When The Psychic Tree began trading, they struggled to find suppliers who would offer trade credit, mostly, Laura says, because it was not common practice in their niche vertical. In the intervening years, Laura has seen an increase in the number of suppliers offering credit terms.
Often though, the credit offered to Laura is done so on an ad hoc, offline basis. Since Hokodo partnered with a large giftware wholesaler earlier this year, Laura has been able to take advantage of a trade credit solution built for e-commerce.
“I think the main difference is the automation of it. It's useful because Hokodo automatically takes the money when 60 days are up. I don't have to think about it. I don't have to actively go into the bank and make a payment run or anything like that. It takes away that layer of admin to make payment seamless. ”
Want to find out more about how paying with Hokodo could help to grow your business? Check out Hokodo’s buyers hub.