Manufacturer of Specialty Wood Products



Line of Credit secured by Accounts Receivable and Inventory

Manufacturer of Specialty Wood Products

The company is a 2nd generation manufacturer of wooden products sold to big box retailers and to other manufacturers. Their 15 year old banking relationship soured after the company sustained losses caused by a move to a new facility followed by an ice storm which exacerbated business interruption. The company had never experienced a move in their 55 years in business, but they had to move when their landlord decided to sell the property. Management found an excellent new facility in a Nashville suburb which they decided to purchase, however, they did not anticipate the amount of business interruption a move would create. After a sizable loss caused by the move in 2014, the company was trying to catch up to it’s pending orders during it’s peak season when an ice storm crippled the region in early 2015. This caused the company to report a sizable Net Loss for YTD 2015.

As a result, the company’s credit was downgraded by their bank and they were informed that their line would not be renewed. The owners of the company had a relationship with a local Private Banker at a smaller regional bank who was able to make the company a bridge loan while they helped them find the right financing solution. During the bridge period, the company was introduced to Southeastern Commercial Finance by the Private Banker and a loan was approved and closed before the company’s line expiration date. Also, the bank had frozen the company’s line and reduced it with each collection of the company’s receivables. SCF was able to restore the company’s line to it’s former level and give the company more favorable advance rates on the collateral base. As a result the company was able to obtain the financing required to complete orders during their peak season and they are on their way to profitability. This was a win for the Private Banker as his efforts resulted in the company moving it’s depository relationship to his bank. It was also a win for the company as they obtained the working capital solution needed at a critical time thanks to the Private Banker’s introduction.