Working Capital for IT Staffing Increases Growth and Retaining Profits
A Southeastern staffing company founded in 2009 focuses primarily on providing IT and Engineering professionals with positions in the Automotive, Aerospace, Defense, Biotech, and Structural/Architectural industries. The company has a placement rate of over 90%, an executive team with a combined 40 years of industry experience, and a customer base of both Fortune 100 and locally-owned businesses.
Over the last couple of years the company faced with numerous challenges resulting in a loss of revenue. Among them included: a buyout of a partner; and a loss of a large portion of temporary staff to permanent positions from one of its major customers caused a drastic reduction in a relied upon revenue stream.
Realizing the company was faced with a cash flow challenge and needing a quick fix to their illiquidity. The CEO made the decision to contact an ACH lender for an infusion of capital. While this was a short term fix to supply the Company with capital to cover overhead and payroll; it came with a very high interest rate. The Company realized this was not a sustainable plan and contacted the previous factor to provide a longer term solution.
While the factor was able to relieve the burden from the ACH lender the company soon learned it would not be able to support future growth. On their current path with an 85% Advance Rate and high fees the factor was consuming all company profits that could be used to grow the business.
Recognizing once again their current working capital solution was not viable the Company chose to seek a different factor. Seacoast Business Funding was able to establish a structured repayment for the factoring facility with a lower monthly schedule and interest rate to repay the term loan with the previous factor.
In addition, to support the Company’s growth SBF was able to increase their advance rate from 85% to 92%. Given our expertise in the industry we understood the complexity surrounding the company’s needs. We provided a working capital solution that will allow them to grow and retain profits.
– Increased Working Capital with Advance Rate up to 92%
– Lower Monthly Schedule on Over Advance
– Reduced Interest Rate by 3% on Over Advance
– Lower Overall Monthly Fees
– No Wire Fees
– 3 Weeks to Underwrite and Fund