This is very common in a lot of industries especially physical goods and medicine.

You end up leverage for all the goods but the final settlement of payment happens much later, making them hard to survive in without a lot of capital and good relationships.

You can screwed very easily and understanding the model and not scaling faster than your capital allows is a skill in itself.

My friend failed at it while I was working with them.

I worked for similar company. And yes, it basically depended on the relationship with the local bank managers and suppliers. Unfortunately, it wasn't so successful.