$100,000 Purchase Order Funding
This small specialty food manufacturing and distribution business began in the coastal region of South Carolina in 2011. Beginning with a wonderful sauce recipe based on an old family recipe, they were able to gain local and regional distribution contracts, and grew the business to $20,000 per month by the summer of 2016.
In July of 2016, a wonderful and scary thing happened as a result of hard work, lots of sampling and tons of follow-up with distributors and wholesalers. The business received an order from a national distributor in the amount of $199,000 – a fantastic milestone for the growing business! But, with current sales averaging only about $20,000 per month, the business did not have the $140,000 needed to pay their “co-packer” to manufacture and ship the order.
The owner immediately visited her local banker with the large Purchase Order in hand, discussing a short-term working capital loan to cover the cost to make and ship the product. Her banker was excited for her, but disappointed to have to tell her that they would not be able to loan against a P.O., and that the business was a bit too young yet to consider a line of credit that would meet her needs.
Luckily, the banker cared enough to suggest another potential solution. Telling her about Infusion Capital Group, he explained that we may be a good short-term option enabling her to pay her co-packer and fulfill the large new order. The owner called Infusion Capital, and after a very productive discussion we were able to confirm that this sounded exactly like the kind of situation where we would be able to provide funding!
2 weeks later, as the requested delivery date drew closer, the owner got back in touch with Infusion Capital to see if we could quickly complete our due diligence, get her approved, and provide the funding needed. Within a few days Infusion Capital wired $100,000 to the co-packer who was able to immediately release the goods for shipment!
One of the things this client really liked about our service was that she did not have to commit to any long term funding, or any minimum amount of funding. She took full advantage of our “use us as you need us” flexibility and was able to deliver on the most important order to date for their young and growing business. Most likely her ability to professionally and promptly deliver on this big order with a major national distributor will lead to rapid growth in the coming 12-18 months, and the business may again find that they need us for occasional spikes in orders. If so, we will be here to help with rapid and flexible funding!