Small Business Owner
A small independent contractor is experiencing 100% annual growth that has created a cash flow problem. Most of his cash has been tied up in equipment previously purchased. He has always struggling to find money to meet payroll, hire new staff and maintain the required equipment. His primary customer has demanded more capacity from him The industry is consolidating from 10 general contractors down to three. The opportunity for this contractor to gain more business from his existing clients represents a significant growth opportunity; however, this will require more equipment and staff. To take advantage of this opportunity he needs to move quickly to obtain a business line of credit and a small business equipment loan which could increase gross revenue by almost 400%.

The bank was willing to allow the equipment to be appraised at replacement value less depreciation. This worked to his advantage because he had purchased his equipment at less than wholesale and liquidation prices due to industry restructuring. He has sufficient equity that could be assigned to restructure his current assets into long term assets using the combination of a small business loan and a business line.

The bank has granted a $175,000 loan and a $100,000 business line which will allow him to continue leveraging the market opportunity and increasing his market share.