Summary
An established family manufacturing company operating within the Automotive & Aerospace sector had been looking to gain a competitive advantage against their peers to win new business. They were looking for a value added solution that would help them win new business and grow.
Challenges Faced
Although the company was trading with no real issues they were looking to be innovative to demonstrate their ability to potential customers to win larger contracts, looking to differentiate. The market price was crowded and they understood if they could bring in innovation to their funding structure it, as they did with their production, there were opportunities to capitalise upon…but where do they start?
Our Solution – Strategic Review
The company was recommended to us by a professional advisor and after undertaking a Strategic Review of the business we found that working capital was absorbed in funding the stages of production prior to the buyers sign off which restricted growth and competiveness. Although the business was cash generative….we found a better way of operating.
We tailored a funding solution that would fund each stage of production for the company upfront and was re-paid upon payment from their buyer, this could be up to 2-3 months per stage. Tooling was also funded in this facility as well as the requirement to build and hold stock levels for call off from their buyer. Total Facility £1.6m
The Value Created
Having this facility in place allowed the company to offer more attractive terms with their buyer (reduced reliance on their payment profile) but retained the surety of payments which appealed to the buyer and thus further business was placed with the company and now they are winning further contracts and can place themselves differently to their customers.
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