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Start-up CNC Machine Shop

 

SITUATION:

 

This early stage company specializes in CNC machining, design and product development for a variety of customers that require smaller runs of customized products.  With minimal overhead expenses and a rapid turnaround time, the owner established a niche that soon caught the attention of larger customers.  The owner then found purchase orders coming in faster than he could respond; and realized he needed additional working capital to hire extra staff and pay suppliers. With less than one year of operating history, he did not qualify for a traditional bank line of credit.  To provide an alternative financing solution, the banker referred the company to Magnolia Financial.

 

SOLUTION:

 

With significant experience financing Machine Shops, Magnolia met with the  company and provided a proposal within 24 hours of the initial meeting. Despite the limited operating history, Magnolia focused on the company’s Accounts Receivable and the opportunity for future growth.  The cashflow provided by Magnolia has given the company the necessary resources to fulfill new orders in a more timely fashion.   and has set them up for significant growth in the months to come. Best of all, the referring banker was able to win the deposit relationship and looks to provide the line of credit within 12-18 months.