Family Company Builds Revenue
Asset-Based Loan Family-Owned Furniture Company Builds Revenue
Author: Valerie Mellema
Date posted: 04.02.24

Anyone who can create handmade furniture has a skill that makes them in demand. After producing pieces for family and friends, one man with that passion and talent decided it was an excellent choice for a small business. Things were going well in his Midwestern town as word spread that he could create beautiful tables, beds, and more.

But is Local Business Enough?

Being great at something will make a name for you and your brand. However, selling furniture to a small audience isn’t something that can sustain a person for the rest of their life. At first, things were excellent, and the furniture company grew with clients, leading to bringing on employees to handle the things the owner could not. But when you’re selling furniture that lasts for decades, most people aren’t going to be customers time and time again.

 

Expanding Beyond the Local Area with Financing

Making the decision to make more furniture, market beyond the local area, and work with shipping companies was a huge one. It made sense if the owner was going to succeed since demand in his local area was waning. However, he didn’t have the money needed to handle the process independently. After doing the math, he came up with a number. All the things that needed to be done could be handled with $650,000 worth of financing.

Family Company Builds Revenue

What Kind of Financing is the Answer?

The amount of money needed felt like a lot to the owner, but he also knew it was his big chance. He needed to make sure he took only the right financing and could back it up if things didn’t work out. Since he was all in by this point, a loan with his equipment and business location as collateral seemed like a good choice. After going through the possibilities, it seemed that an asset-based loan would work out well.

Reason to Go Asset-Based vs. Traditional

There were a lot of reasons to choose an asset-based loan. Of course, the ability to use his inventory as collateral was a large part of it. But he also knew that it would be easier to get the loan since he had something to secure it with. Thankfully, a bank was happy to offer him terms that worked well for his needs.

What Happens Next

Once the loan came through, the owner was busy.

The business needed new employees to handle much of the day-to-day work while they revamped it to accommodate a more extensive client base. Naturally, the owner was worried since so much was changing, but it turned out that he shouldn’t have worried. His gorgeous furniture quickly gained popularity in other parts of the country, and he was ready for it. As a result, today the company is selling furniture nearly as fast as they can make it.

Family Company Builds Revenue
About The Author | Valerie Mellema

Valerie has over 16 years of experience as a professional writer of blogs, eBooks, articles and press releases, with a focus on finance and alternative lending. Valerie resides with her family in Texas and is passionate about her horses.

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