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A food manufacturer was referred to Spark by an FX partner through Spark Connect. The business already had finance in the form of Confidential Invoice Discounting (CID). However, the company had £4M in outstanding invoices not funded by their current lender.
The company:
A successful outcome would enable the company to pay all their suppliers and successfully fulfil their orders. They were initially seeking an unsecured business loan.
Following a thorough review of the business and discussions regarding the purchase plans, Spark suggested a Trade Finance facility. This option would align with their objectives, provide more flexibility compared to an Unsecured Loan, and relieve some of the pain points presented.
Having a Trade facility set up instead of securing a loan meant the business could utilise this solution in the future again, if required.
As the CID included an all assets debenture, it would require a lender to accept a Personal Guarantee instead of a standard debenture. Additionally, it all had to be completed within the client’s time frame.
The existing FX partner-client relationship and the appropriate lender allowed the expedition of the entire process, overcoming all challenges. Due to Spark’s relationship with the lender, utilising a Personal Guarantee as security was accepted, although it limited the size of the approved funding. A facility of £750,000was agreed upon, enabling supplier payments.
A week after the facility became live, £500,000 was drawn down by the client, who utilised the remainder of the full facility the following week.
Cashflow challenges with credit line current provider:
The CID in place for the business was unable to fund some outstanding invoices, leading to a cashflow shortage to fund supplier invoices.
Security available:
As the CID was set in an all assets debenture, it would require for a Personal Guarantee to be accepted instead of a standard debenture.
Time frame:
The required cashflow was to pay suppliers invoices. The facility would have to be implemented in a short period of time to allow the business to fulfil all orders accordingly.
Business Assessment: Detailed assessments of the businesses current financial situation and limitations.
Product expertise: Spark’s financial expertise and AI enabled the matching of the business assessment to the best solution.
Relationships and support: Spark’s relationships with the referral partner and lender were key to quickly overcome challenges and tailor the facility to client’s needs.
As a founder of multiple businesses, Jamie believes that mindset, discipline and ambition are key drivers for success, both for his businesses and for his clients.
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