Retail Manufacturer Secures Financing

Supply Chain Issues Hit


COVID didn’t mark the conclusion of challenges for this manufacturer. The situation turned exceedingly intricate as supply chain issues grew more prevalent. While COVID prompted some competitors to close temporarily or permanently, this company encountered a problem, witnessing a nearly 50% decline in business while grappling with persistent losses.


Facing a denial of additional traditional funding, the company’s leaders put on their thinking caps, exploring innovative pathways for progression. Retail manufacturer secures financing became the turning point, as they ventured into a strategic pivot. They identified a promising resolution in developing a new product line centered around personal protective equipment. This inventive step not only addressed supply chain intricacies but also aligned with evolving market demands, signifying a triumphant adaptation. This approach not only revitalized their operations but also enabled them to showcase how retail manufacturer secures financing as a testament to their resilience and determination.


The Cost to Expand and Change


Before exploring potential financing options, understanding the exact amount of funds required for the expansion remained essential. Meanwhile, the company managed to attract clients from competitors who had shuttered their operations. Recognizing the significance of this transformation, they were well aware that achieving success would demand a substantial investment.

After careful consideration, the manufacturer calculated a need for approximately $500,000 to proceed with the new product line. While this represented a considerable sum, they maintained optimism that a solution would emerge.


Retail Manufacturer Secures Financing

What Financing Options Are Available?


With traditional bank loans still unavailable, it was time to dig into other options. Some of the options included a line of credit, merchant cash advance, SBA 7(a) loan, and asset-based loan. After getting details on each of these financing options, the owners went through them to determine which would be the best for their future needs.


It was easy to see that a loan with collateral would be a good choice since the business had facilities, equipment, and products. However, that still left them choosing between several options. In the end, the asset-based loan edged out other choices.


What Makes the Asset-Based Loan Special?


Companies secure asset-based loans by pledging a diverse range of company assets, encompassing everything from accounts receivable to equipment and inventory. This business possessed all these assets and considered this financing avenue highly favorable. The added benefit was that it also brought about lower interest rates.

These loans offered the required $500,000 and even more. The interest rates were modest, and the term spanned from two to 10 years, rendering the loan not only cost-effective but also adaptable, with manageable monthly payments.

What Happened Next


Working with the new lender, the company was able to finance its new product line. The loan was based on inventory and receivables so there would be few restrictions in place. This made it possible for continual growth to be realized for the business.


Since getting the asset-based loan, the business has quickly caught back up and is making great profits. They’re happy about the financing they chose and would look to alternative forms of financing in the future. All in all, things are going great and the new product line has been a huge hit.

Retail Manufacturer Secures Financing

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