Online beverage supplier Digital Wine Ventures (ASX: DW8) has announced a new partnership with payment solution provider Earlypay (ASX: EPY) to launch a Digital Wine Ventures teams with Earlypay to launch a managed payment solution for users of its WineDepot marketplace.
The deal involves the launch of Liquidity, a payment management solution that will allow WineDepot Market buyers access to a line of credit that can be used across any product listed on Digital Wine’s business-to-business (B2B) e-commerce platform.
Digital Wine chief executive officer Dean Taylor said the service is expected to have significant appeal to both buyers and suppliers, as venue operators look for ways to simplify their business operations and effectively manage their cash flow in a post-COVID-19 world.
“The average fine dining restaurant sources wine and other alcoholic products from about 50 to 200 different suppliers. That’s a lot of relationships, accounts and payments to manage,” he said.
“On top of that, each supplier typically has different ordering systems and offers credit on vastly different trading terms.”
Mr Taylor said being able to purchase from many suppliers on a single order, that is received in one delivery and settled with one payment, will be a “game changer” for venue operators.
“Similarly, having access to a guaranteed and optional early payment is also very attractive to suppliers, who can often spend several days a month chasing up overdue invoices. Being able to outsource this function will have significant appeal to suppliers large and small,” he added.
For Digital Wine, Liquidity also ensures that average order value remains high and credit terms are not a barrier to sale.
As a result of this new agreement, Digital Wine has also terminated a proposal it made last September to partner with Multi Service Pty Ltd (now called Trevipay), which would have provided a line of credit to WineDepot users.
Earlypay will provide the back-end technology, operational support and funding for WineDepot Liquidity. The payment solution will also be backed by the fintech’s comprehensive credit insurance.
The deal is for a minimum three-year period from the launch of the Liquidity service. A one-off implementation fee and minimum monthly fees will apply for the term of the agreement.
Mr Taylor said Digital Wine was attracted to Earlypay because it is an innovative Australian owned and operated company with more than two decades of experience in supporting Australian businesses.
“Their market leading platform integrates directly with our own platform, allowing us to provide a seamless buy now pay later solution to our marketplace buyers.”
“We know that credit terms are a critical element for success on B2B marketplaces and are excited to be able to partner with Earlypay to offer the Australian wholesale beverage market a much simpler payment solution,” he added.
Earlypay chief executive officer Daniel Riley said his company is proud to provide additional payment flexibility for marketplace buyers and facilitate early payment for suppliers, since managing cash flow can be a challenge for many Australian businesses.