Accounts Receivable & inventory Line of Credit
This plastics and compound manufacturer provides raw materials to companies that produce a variety of colored plastic products. Historically profitable, the company expanded their product line in early 2020 to include black resins. Soon after they began to ramp up, the COVID-19 pandemic arrived, and many of their customers temporarily shut down production. As a result, reveunes dramatically decreased, and the compapny reported losses for multiple months. As their customers opened back up, the company needed additional working capital to support the increase in business. However, their bank was unwilling to increase their line of credit that was already maxed out.
Magnolia Financial extended the company a $1,500,000 Line of Credit secured by both Accounts Receivable and Inventory. The funding provided by Magnolia not only paid down the bank's exposure but also gave the company additional working capital to support the turnaround. The bank was able to keep the deposit relationship as well as the building and equipment loans. The company now has sufficient working capital to execute its growth plan and anticipates an imminent return to profitability. Neither would have been possible without the Accounts Receivable and Inventory Line of Credit from Magnolia Financial.
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Kerry Coker, KAMADO JOE
"The Magnolia guys have a real ‘can do’ attitude. Marc Smith and his team are super responsive and upbeat. They can fund within a matter of days. They are always looking for positive opportunities for their clients. It's a breath of fresh air to work with someone like that."
Frank Workman, Dealers Supply & Lumber Company
""Magnolia was really available when we needed them, and the leadership at Magnolia was empathetic to the cold, harsh nature of traditional banking. It gave us a tremendous amount of comfort during a difficult time. Marc Smith and his team really understood where we were, where we were going and gave us the help we needed to get there.""
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