Case Studies: Success After Bank Denial

#1: Demand for Merch by Live Music and Sports Fans Over-Stretches a Printing Company’s Finances

CHALLENGE

When touring rock bands and professional sports brands began filling stadiums again post-pandemic, a Pennsylvania-based company specializing in custom embroidery and screen printing saw a dramatic spike in purchase orders from an eager national customer base.

They were accustomed to meeting the demand for top-quality products and services, but the surge and volume of orders required large payments to its overseas supplier, followed by a long wait for the apparel shipped by air-freight or sea vessel before its final leg by truck. By the time they received its material supply, completed orders and shipped custom merchandise across the country, many weeks had passed. And only then would the clock start for a customer’s 60-day payment terms. Cash was needed to maintain production and manage their reputation.

As the co-owners reached out to traditional and alternative lenders for capital, they were told one of two things: Their business was either growing too fast, or the amount of capital requested was too small. They faced a dilemma - and that's when they reached out to Alterna.

SOLUTION

Following an introduction by our parent company Paychex, our team jumped on a group call with the owners, controller and their attorney to address all contract and funding timeline questions. Together, we made a couple adjustments to the proposed contract during the call until everyone on the client side was satisfied and ready to move forward. Our account manager was assigned and began leading the client’s communication with customer accounts payable, freeing up the client to focus on important new business relationships and growing demand for fan apparel.

Partnering with Alterna, the apparel company received:

  • $1 Million in funding to cover payroll and other overhead
  • A 90% advance rate on receivables funding
  • Quick credit confirmation of customers
  • Account support from the Alterna team
  • Professionalism and help in communicating with their customers to ensure satisfaction.

#2 Invoice Financing Fuels Growth for Oilfield Services Company

CHALLENGE

A new Texas-based company specialized in the installation of salt water gathering and disposal systems for oil and gas companies. Their innovative oilfield service minimizes trucking risks and environmental damage while increasing the efficiency of oil and gas production.

Although possessing the expertise and man power to capture and staff large projects, the firm lacked the cash flow required for equipment and payroll. A new project was secured and a second was bid when they received bad news—their current lender declined to expand the available credit line.

SOLUTION

With only 48 hours until payroll, the business owner called Alterna Capital Solutions with a grave concern: On the Texas oil fields, integrity is everything, and missing payroll would be the beginning of the end for the young company. Multiple equipment liens on accounts receivable and proceeds also added to the complexity.

On the upside, the client had an unpaid $580,000 invoice. We quickly contacted the debtors, establishing a relationship and assignment of invoices to our lockbox. Then we flew into Texas to finalize the contract details and worked alongside our client to contact equipment companies and remove liens.

Here is what happened:

  • Client was funded in time for payroll
  • They received a $3 Million credit facility
  • Client won a $20MM project, generating an additional $1MM in invoices
  • The client is busy interviewing and hiring for growth
  • We continue to work closely with our client and their customers to manage invoices and field-level verification ahead of the payroll cash crunch
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