As hiking and fitness became more mainstream, their revenue grew along with people’s willingness to venture into the outdoors. By 2015, they were bringing in $3 million in annual sales and employed 15 people, many of whom had been with the company for years.

 

In late 2020, a well-timed tweet by a celebrity made the backpacks suddenly trendy and a must-have item. But while their usual customers were willing to wait for their backpacks, new customers were turned off by the delivery times which were stretching further into the future.

In order to increase their production capacity, they needed to buy additional manufacturing equipment to produce more products. To purchase the equipment, the company needed $450,000. But they also needed to purchase more raw materials for production. Growth in business is good, but it isn’t always easy to fund. These two large expenses were more than their small operation could fund while maintaining a cash reserve.

 

Because of the specialized equipment needed to produce their goods, they tended to use their equipment for decades. Fortunately, they were able to find a piece of used equipment that could be adapted to create their product and could be moved to their manufacturing plant quickly. But the company needed to move quickly and find financing for the equipment.

Knowing that their equipment was unique to their business and with their long-term vision for the company, the company decided to purchase the additional equipment using an equipment loan. After reaching out to an equipment loan expert, they were able to submit the handful of documents required to obtain the financing which included bank statements and a recent tax return. Within five days they had been approved and the 5-year loan term meant that the payment was manageable.

 

The momentum started by the celebrity tweet and the shortened delivery times allowed the company to increase sales in 2021 by 30%. The company hired additional employees to meet the new demand and started investigating additional product lines to complement their hiking backpacks.

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