Accounts receivable line of credit for a Walmart vendor that specializes in dry foods gets funded with a $1 Million credit facility.
1st Commercial Credit has funded a vendor of dry foods that sells to major retailers. One of the largest concentrated customer on the receivables was Walmart. The recent demand for dry foods in the united states has doubled and in some areas tripled. The company invoices over 1500 invoices a week delivering product to many regions located in the northern east coast states.
Our client has been in business for over 20 years, and had a small line of credit at the bank. Due to the amount of increased purchases, the payables to suppliers grew proportionately as their credit terms sales. The situation caused a cash flow hardship for the suppliers, and the suppliers asked for prompt payment due to their own situation with cash flow shortages.
The bank declined to increase the line of credit leaving our client short-handed on cash. The client contacted 1st Commercial Credit 2 weeks ago for a solution and within 15 minutes the company had an accounts receivable factoring term sheet to review. After reviewing all options offered, they decided to go with us for funding.
Fortunately, the client had enough accounts receivable to pay off the bank that took care of the priority lien and the client paid off suppliers promptly. Moving forward, the our client will upload their invoicing using the EDI platform that the major retailers require and we will be funding based on that report along with proof of delivery receipts from the delivery agents.