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Staffing Company Needed A Lender to Assist with High Debtor Concentration

Staffing company rapidly grew with its largest customer resulting in a strain to their cash flow.

Background:

A successful company in the staffing industry had been financing their accounts receivables for a number of years. The company had been in business for many years and never faced any issues with their factoring provider until business with their biggest customer grew too large.  

Location: West Coast

Industry: Staffing

Problem:

The staffing company rapidly grew with its largest customer resulting in a strain to their cash flow. The amount that the staffing company was billing their customer became too high for their accounts receivable lender and the factor was unable to approve the higher credit amount to accommodate the company’s growth. The factoring provider thought that the high debtor concentration was too much of a risk. The staffing company was now faced with a problem because the factor couldn’t provide them with the liquidity they needed in order to make payroll.

The staffing company was anxious about losing their customer’s business and had to find a new funding source who could accommodate their needs. The owner went on a search for a reliable factoring lender and had a checklist to find:

  • A lender who would understand their needs
  • Credit limit approval for their customers
  • Quick approval

The owner did their research and came across Commercial Funding Inc. (“CFI”)

Solution:

Commercial Funding moved quickly and aggressively to accommodate the needs of the new client. CFI stepped up and approved the credit limit needed for the staffing company’s largest customer as well as the credit limits for all their other customers. The facility was approved within 24 hours. This quick turnaround allowed the company to hold onto and grow the business with their customer, as well as build a close relationship with their CFI representative.

One month after the client-relationship began, CFI immediately increased their credit line from $1.5M to $2.5M.  

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