Post on 18-Jul-2020
SCC is committed to "Keeping the Entrepreneur Dream Alive!"
Sterling Commercial Credit is a family owned and operated service
provider specializing in financing for small to mid-sized businesses,
which includes invoice factoring and asset based lines of credit. Our
financing is secured primarily by Accounts Receivable, Inventory or
Equipment.
INVOICE FACTORING & ASSET BASED LENDINGSTERLINGCOMMERCIALCREDIT.COM
• Financing Transactions Include (not limited to:)• M&A Transactions• Fast Growth• Undercapitalized• Start-Up
• Factoring, Asset Based Lines of Credit (A/R, Inventory or Equipment)
• Companies that report annual revenue $500,000 - $35,000,000
• Credit Facility from $100,000 - $3,500,000
Manufacturing
B2B Service
Distributor
Staffing
Transportation
Tool & Die
Oil & Gas
Government
Wholesalers
Seasonal
www.SterlingCommercialCredit.com810.229.2601 | 800.560.2601
Invoice FactoringA type of business financing which involves the sale of a company’s
accounts receivables, at a discount, to Sterling Commercial Credit
(SCC). SCC takes on the credit risk of a company’s debtors and will be
paid back when the debtors pays the full amount of the invoice.
Asset-Based Lines of CreditProvide businesses with immediate funds and ongoing cash flow
in the form of a revolving line of credit based on a percentage of
the value of the company’s assets, such as commercial accounts
receivable, inventory, and machinery & equipment. Interest is
calculated on the funds advanced.
Many companies use Asset-Based Lending as a constant source of
working capital and borrowers only pay interest on the funds they
draw. Companies also use Asset-Based lending when they haven’t
been able to secure financing through a traditional lender for a
multitude of reasons.
$2.8 Billion in funding since 2004
Sterling One Rate – All Inclusive Factoring Fee
Improve cash turnover with Sterling’s collection experts
Daily Collections Calls; Mid-Month A/R Statements
Invoice Validation to ensure accurate billing and timely cash turnover
No hidden fees
Founding Partner
CNC CAD MACHINE SHOP AND DESIGN
COOLING FAN MANUFACTURING & DISTRIBUTION ENGINEERING CONSULTING
HYDRAULIC MANIFOLD MANUFACTURING
TRANSACTION TYPE: Small Business Administration / SCCLOCATION: OHIO
DEAL SHEET:• Company is a Machining Fabrication CNC Shop in rural Ohio
• Annual Sales Last Three Years Range from $3.5M to $4.3MM
• Open Accounts Receivable $605,000; Made up of 15 Customers
• Bank debt $315,000 - Secured By All Assets: Receivable, Inventory, Equipment
• Real Estate Loan $40,000; remaining on a 20,000 sq. ft. building
COMPANY AND BANK GOALS:• Bank Acquired; No longer funding commercial loans
• Bank has frozen line of credit and no longer allowing for growth
• Company’s aging was over $600,000; Looking for growth capital
• Bank requested depository accounts remain with them
STERLING SOLUTION:• Partnered with SBA Strategic Partner to Re-Finance Building $350,000
• SBA debt financing paid off all short term liabilities and mortgage
• SBA subordinated Accounts Receivable to Sterling
• Sterling provided working capital for growth on 85% of available receivables
TRANSACTION TYPE: High GrowthLOCATION: NORTH CAROLINA, FLORIDA
DEAL SHEET:• Company manufacturers and distributes commercial cooling units in NC and FL
• Annual Sales Last Three Years Range from $11.1MM to $14.9MM
• Open accounts Receivable $1,100,000; Made up of 8 Customers
• Bank debt $900,000 / Trade Payables $750,000
• Equity group invested over $19M in sub-debt over 5-years
COMPANY GOALS:• Lower Cost of Funds - 2 Lenders providing A/R Factoring and Purchase Order Lending
• A/R Factoring Cost of Funds 33%; Purchase Order Cost of Funds 48%
• Seeking single lender that could fund on A/R and Inventory - Eliminate P.O.
• Seeking savings of over $400,000 cost of funds from hard money lenders
STERLING SOLUTION:• Sterling offered over $5M in lines of credit secured by A/R and Inventory
• All purchase order and factoring lenders were paid in full at closing
• Sterling sat on advisory board due to high seasonal spikes in business model
• Sterling met face to face with investor panel and set expectations for summer season
TRANSACTION TYPE: Bank Work OutLOCATION: FLORIDA
DEAL SHEET:• Company provides consulting engineering for mechanical, electrical & plumbing
• Annual Sales Last Three Years Range from $7.1MM to $9.8MM
• Open Accounts Receivable $1,700,000; Made up of 77 Customers
• Bank Debt $1.4M; Required a $300,000 haircut after 18-months of forebearance
• Mezzanine Source $6.0M; Required $400,000 downstruck and $2.0 Million note
CUSTOMER GOALS:• Exit 5/3 Bank forebearance arrangement that was 18-months long and costly
• Rightsize balance sheet with over $6 million of ‘paper’ equity dropping to bottom line
• Locate new partner with strong credit disciplines that understood asset conversion cycle
STERLING SOLUTION:• Sterling offered $3 Million LOC and $350,000 unbilled LOC with 2-monthly draws
• Company bills “monthly” as such SCC allowed for two $174K “payroll” draws to even out cash flow
• Sterling provided 75% advance on “factored’ invoices due to credit risk profile
• Sterling improved over 120 day trend from $600K or 30% of aging down to $300K
TRANSACTION TYPE: Merger & Acquisition
LOCATION: MICHIGAN
DEAL SHEET:• Company is a manufacturing & design shop in Michigan
• Annual Sales Last Three Years Range from $1.3M to $1.8MM
• Open Accounts Receivable $315,000; Made up of 22 Customers
• Bank debt $0 / Trade Payables $110,000
• Second generation ownership; Business started 1974 (54-years old)
OWNER / SELLERS GOALS:• Purchase price was $695,000; All Assets Including A/R & Inventory
• Employee contract at $52,000 per year; Working 30-hours; 2-3 more years
• Youthful new ownership; Grow sales by adding marketing approach
• Payoff past dues with top steel supplier ($60,000) and Landlord ($50,000)
STERLING SOLUTION:• Sterling met with prospective buyer and negotiated LOI terms with Seller
• Sterling provided $385,000 based on $260,000 receivables and $125,000 equipment
• Equipment appraisal confirmed total fixed assets of $312,500 (SCC LTV = 40%)
• Sterling provided advisory service for first 60-days with support consultant on-site
$2,250,000Line of Credit
SERVICECOMMERCIAL ARCHITECT
FLORIDA
$500,000Invoice Factoring
SERVICEIT CONSULTING
MICHIGAN
$1,500,000Line of Credit
MANUFACTURERMANIFOLD DRILLING
UTAH
$500,000Line of Credit
DISTRIBUTORMEDICAL LAB SUPPLIES
NORTH CAROLINA
$500,000Invoice Factoring
TRUCKINGOVERROAD FREIGHT SERVICES
LOUISIANA