Background:
The company specializes in armed and unarmed security and patrol services. Based in Los Angeles with offices across California, they are expanding into other markets within the U.S.
Financing Solution: Factoring
Initial Amount: $3,000,000
Location: West Coast
Industry: Security and Patrol Services
Problem:
In business for nearly three years, this young company was growing rapidly by expanding their service offerings and geographic reach. They had been working with a factoring company but were being capped at a maximum credit limit that was not allowing them to leverage all their receivables. The current factor was not comfortable with the company’s rapid growth and was not providing the necessary cash flow for continued expansion.
They needed a funding source that was supportive of a rapidly growing small business and willing to provide funding for future opportunities.
Solution:
Commercial Funding evaluated the company’s financial information (profit and loss statements, accounts receivable aging report, etc.) as well as their customer list and determined that an initial factoring line of $3 million would allow the Company to factor all of its receivables, if needed.
In three weeks from initial contact, CFI provided an accounts receivable factoring line that was double the size of their current factoring facility. The increased facility provided a large injection of working capital into the business and at a lower cost than their original facility.
Their relationship with CFI has helped:
- Relieve company management’s stress from recent cash flow burdens.
- Provided access to funds for payroll and critical business payables.
- Provided extra liquidity (and confidence) to bid on, and secure, additional opportunities in their current market and expanding marketplaces.
If your company is experiencing rapid growth, but that growth is being hampered by lack of availability to funding, accounts receivable factoring might be able to help. Read Is Invoice Factoring Right for Your Business? to learn more. Then contact us and we'll get you started.
