Northeastern US Bakery $2.5 Million Receivables Factoring and Revolving Inventory Loan Facility
Greenville, SC – We are pleased to announce that Accord has provided a $2.5 million asset-based lending facility to a bakery, primarily servicing the northeast US regional grocery store market.
Founded in the early 1990’s by a husband-wife-daughter trio, the bakery originally contracted production to third parties. In 1999 they purchased a facility in Connecticut and brought the production in-house.
After some measured growth, the founder decided to sell the company. The new private equity owners brought in new management, who then made a series of missteps, creating inefficiency and excessive waste. Even though the PE firm acted quickly to address these issues, the previous poor financial performance caused the bank to become fatigued, and they ultimately converted the revolving credit facility to a term note with rapid amortization.
With a new CEO who boasts extensive bakery management experience, the company instituted lean manufacturing and continuous improvement practices. Accord has confidence in the company’s new management and in their ability to increase sales and profit, especially considering a recent, very large order with a national retail chain. Accord also has a long relationship with the private equity group owner.
This transaction funded the bank payoff as well as much-needed working capital to buy ingredients and build up inventory to fulfill the company’s seasonal holiday orders.