“Boxed” In By Its Factor, California Packaging Manufacturer Comes To Us For New Financing

The Company
This Company is a California-based manufacturer of packaging products primarily used in the healthcare, cosmetics, pharmaceutical and food industries. 2019 was a rough year and a consultant was brought in to help make some changes and cut expenses.

The Situation
The financing arrangement this Company had with a factor was that credit card receipts would go into the Company’s operating account. Recently, and all of a sudden, the factor wanted to change that arrangement. The relationship quickly soured and the factor asked the Company out. The consultant brought Celtic Capital in to replace the factor, and because the business was expanding, asked for a larger line with some reliance on inventory.

The Solution
Celtic Capital provided Accounts Receivable and Inventory Lines of Credit totaling $2,425,000. Funding occurred just after the Coronavirus lockdown was announced in California. We did not hesitate moving forward with this deal given the Company’s business in the healthcare and food industries.

The Result
Though too early to tell what the future brings, thus far, sales are up during the crisis. The Company has paid off the factor and the additional working capital has enabled it to take advantage of increasing sales.

About Celtic Capital
Companies looking for working capital to cover operating expenses, fund growth, increase buying power and take advantage of vendor discounts and rebates turn to Celtic Capital. With an appetite for the more complex transactions, Celtic Capital has a history of success in crafting creative, flexible asset based financing solutions from $500,000 to $5 million with no financial covenants.

As an independent lender, working with companies nationwide, Celtic Capital is willing and able to alter price and deal structure and expand lines of credit to handle its clients’ increased revenues; and when cash flow is an issue, will look toward providing an inventory facility to help offset lost cash flow.

If you know of, or are, a business in need of non-traditional financing, contact Mark Hafner at 800.742.0733 or mhafner@celticcapital.com, or visit us at www.celticcapital.com.