Rosenthal & Rosenthal completed a $750,000 purchase order finance facility for an automotive client and a $10 million collection factoring agreement for a mattress company. Both clients will be serviced by Rosenthal’s southeast office in Atlanta.
The purchase order finance facility was established for an Alabama-based importer and distributor of new passenger car and light truck tires. The company faced challenges as it was diversifying its product sourcing. When the company shifted production from China to a supplier in Vietnam, the new supplier required payment assurance before producing and shipping product. The client was working with a regional asset-based lender, which referred the company to Rosenthal’s southeast office.
Rosenthal established a $750,000 purchase order finance facility that allowed the client to fund the production of product, backed by sales orders from a large end customer. The facility included funding via letters of credit as well as cash funding for freight, duty and logistics costs.
“The supply chain challenges that have emerged in the current climate surrounding COVID-19 have made it even more critical for importers to have a diversified production sourcing strategy,” Paul Schuldiner, division head at Rosenthal, said. “This transaction highlights our team’s extensive knowledge facilitating inventory financing solutions for companies with changing sourcing requirements. Purchase order financing is a valuable tool for importers who want to take advantage of larger sales opportunities with properly structured international trade financing.”
The $10 million collection factoring agreement was provided to a mattress company in need of a factoring partner to help the company expand its reach to new retail markets. With its U.S. headquarters in Tennessee, the company primarily sells only to distributors in the U.S., requiring a full prepayment, deposit or credit card payment at delivery. With demand from retailers expected to grow, the company began to offer terms to its retailers but needed a factor to support the transition to that new model.
Rosenthal provided a $10 million non-recourse collection factoring engagement, designed to support multiple accounts to which the company intends to extend terms. Rosenthal also will provide back office customer credit and collections support to help the client streamline operations and overhead.
“Rosenthal’s non-recourse collection factoring facilities are excellent solutions for companies that want to take advantage of new growth opportunities in the current environment,” Brian Resutek, account executive at Rosenthal, said. “Factoring not only gives companies the cash they need to support expansion into new markets, but also helps to reduce overhead and manage receivables — an added benefit for any company without a robust back office.”
Rosenthal & Rosenthal is a factoring, asset-based lending and purchase order financing firm in the United States.
