Community Savings and We Can Capital hit a cannabis industry milestone; licensed producers are provided with +$5 million in working capital
September 10, 2024 Vancouver / Unceded Territories of the Musqueam, Squamish and Tsleil-Waututh Nations - Community Savings, a BC-based credit union and and We Can Capital Inc. are proud to announce a significant milestone in the affordable account receivable purchasing program. Their joint affordable program has passed $5.3 million in working capital for BC cannabis licensed producers, underscoring the program’s role in providing immediate liquidity from BC Liquor Distribution Branch (BCLDB), Alberta Gaming, Liquor & Cannabis (AGLC), and the Ontario Cannabis Store (OCS) invoices for local cannabis producers.
Cannabis producers face significant challenges in accessing mainstream financial services, which can hinder their growth potential. Community Savings’ affordable A/R purchasing program with We Can Capital fills this gap, offering vital financial support that allows licensed producers (LPs) in BC to receive early payment for their government invoices. This early access to funds enables producers to accelerate production cycles and negotiate better terms with suppliers, leading to net financial gains rather than additional costs.
Traditional factoring is a financial service where businesses sell their outstanding invoices to a factoring company in exchange for immediate cash. This practice particularly benefits emerging industries, like the legal Canadian cannabis industry.
Here’s a detailed look at how Community Savings’ Cannabis Account Receivable Purchasing Program (Factoring) works: A BC cannabis LP delivers finished goods and issues an invoice to the governmental board that they have a sales agreement with. Typically, the payment terms vary from 14, 30, or 60 days, depending on the purchasing board. Instead of waiting for government agencies to pay, the cannabis LP sells the invoice to Community Savings. Community Savings then provides a 75-82.5% advance on the same day for the invoice, giving the LP immediate access to working capital. When the invoice is due, the customer pays into the LP Community Savings member account directly, just like a normal transaction.
Existing factoring options for the cannabis industry are often expensive, administratively difficult, and slow to fund. Developed hand-in-hand with their members in the cannabis industry, Community Savings’ accounts receivable purchasing program addresses these challenges and positively benefits the cannabis funding landscape. By offering same-day advances, same-day settlements, and industry-leading rates and terms, Community Savings has surpassed a milestone of $5.3 million in funding, proving the efficacy and appeal of this program.
With growing demand for its program, Community Savings has increased the purchasing limit of $500,000 to $750,000 for licensed producer Woody Nelson of Nelson, BC. This increase allows Woody Nelson to expand its product offerings to current clients that only comes from additional, immediate liquidity and improved financial stability. Licensed producers with large invoices can benefit from similar purchasing limits with Community Savings.
Toby Summers, Director of Woody Nelson Inc., said: “Community Savings’ and We Can Capital’s foresight to create offerings to support BC’s underserved cannabis industry has been transformative for Woody Nelson. The liquidity provided by Community Savings’ factoring line has ensured Woody Nelson has the necessary supply chain inventory to support rapid growth which has been instrumental in achieving our first quarter of positive EBITDA. Through Q3, Community Savings’ factoring line continues to support our strong revenue growth into consecutive positive EBITDA quarters.”
Mike Schilling, President and CEO of Community Savings Credit Union, said: "“Cannabis businesses should have access to the same banking products as every other business in Canada. We are proud to be a pro-cannabis industry credit union that is fighting against banking discrimination and stepping up to provide affordable access to invoice factoring for licensed producers. The fact that we just launched this program in February, and have already achieved $5.3 million in invoice factoring this year, demonstrates the need and demand for this service. We are here to support BC cannabis producers and help grow their businesses.”
Joshua Reynolds, Partnership Director of We Can Capital Inc. Union added,"Partnering with Community Savings to work with Toby and the Woody Nelson team reaffirms my dedication to bolstering the financial stability of this dynamic industry. Witnessing firsthand the transformative impact of instant working capital on a company is truly inspiring. It's a privilege for We Can Capital to contribute to such a vital sector and support the growth and success of businesses like Woody Nelson."
If you are a cannabis licensed producer looking for more information, visit WeCanCapital.com or www.comsavings.com, or phone 604-637-5123
About Community Savings:
Community Savings Credit Union is driven by its purpose to unite working people to build a just world. As BC’s largest fully unionized credit union, Community Savings provides best-in-class personal and business banking. It is the largest provider of banking services to the BC cannabis industry of growers, producers, retailers and ancillary businesses, providing day-to-day banking, lending, and account receivables financing to support the growing sector.
Community Savings operates six branches across the Lower Mainland and Victoria and services its cannabis members province-wide. It lives by its values, from being the first financial institution to become a Living Wage employer in 2010 to winning the 2022 BCBusiness Business of Good Workplace Wellness Award for its innovative staff wellness programs. For more about Community Savings, visit www.comsavings.com.
About We Can Capital:
We Can Capital is a BC-based working capital specialist for cannabis LPs. We Can Capital offers solutions to cannabis businesses that are focused on invoice factoring. Led by Josh Reynolds, We Can Captial believes in supporting BC’s growing cannabis industry with fair, affordable financing solutions to enable cannabis businesses to grow. We Can Capital works in partnership with cannabis companies to support their financing needs. joshua@wecancapital.com for any inquiries.
About Woody Nelson:
Woody Nelson Inc. has quickly established itself as a leader within Canada's premium cannabis market. With a steadfast commitment to quality and innovation Woody Nelson has won multiple awards including ADCANN's Rookie of the Year (2023), Reddit's OCS Product of the Year (2023), Nelson & District Chamber of Commerce Business Excellence Award for Technology-Innovation (2023), and The Rosebud Bowl's Best Flower (2024). With distribution across 5 provinces and top-selling products in multiple categories, Woody Nelson delivers on its promise to supply world-class cannabis products from the Heart of the Kootenays.
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