Asset-Based Lending: Leverage Your Assets, Transition to Growth
Take advantage of our flexible asset-based lending program up to $20 million to finance growth, an acquisition or support a turnaround or restructuring.
Asset-based financing: the optimal working capital solution
Asset-based lending, also known as asset backed finance, ABL lending or an asset-based loan, provides your small or medium-sized business with fast, flexible financing to optimize cash flow and manage effectively through critical transitions. Whether your business is looking to maximize growth opportunities or manage a successful turnaround, asset finance solutions provide maximum flexibility, especially in the following circumstances:
Leverage your assets, fuel your growth
You know the value of your company’s assets, they are the backbone of your business, ensuring your ability to consistently produce and deliver. But as a small or medium-sized enterprise, your assets are also an ideal source of financing. Accord can unlock the value of your assets, and provide you with a flexible ABL loan from $1 million up to $20 million.
The size of your asset-based loan is based on a percentage of the combined value of your accounts receivable, inventory, equipment, and in special circumstances, real estate. This allows your company to turn its assets into working capital and access flexible funding quickly. Most importantly, with an Accord asset-based loan, as your company’s operations and assets grow, so does the available funding, which is essential to help you achieve your next milestone.
Your asset-based loan is based on:
- up to 90% of approved accounts receivable;
- up to 90% of the net realizable value of inventory, equipment and real estate; and
- up to 75% of the cost of inventory that is pre-sold to approved customers
Asset-based lending works just like a revolving loan, which means it’s available when you need it, and you can pay it down whenever you choose.
How Accord’s asset-based lending works for you
Your asset-based loan request will be evaluated based on the value of your collateral and your management team’s experience, aiming to meet your financing needs without imposing onerous financial covenants. This will allow your small or medium-sized business to quickly access more financing than with a traditional bank loan. As you know, timing is key when you need liquidity to manage your daily operations.
- Accord has nearly 40 years of experience in asset finance solutions and in dealing with small and medium sized businesses.
- You deal directly with decision-makers who respond quickly and provide top notch service. The ability to deal with decision-makers expedites the entire asset-based lending process, from due diligence to credit approval and funding.
- Our highly experienced team works hard to understand your business to make sure we grow with you, providing support at each level of success. And our word is our bond, when we say we’ll do something, it’s as good as done.
Debtor-in-Possession (DIP) financing:
Debtor-in-Possession or DIP financing is an interim financing solution which is delivered through a traditional asset-based loan facility that allows you to continue to operate your business while you are restructuring under bankruptcy protection. After successful restructuring, Accord will continue to finance your turnaround plan and fund your renewed growth.
Purchase Order (PO) financing with Letters of Credit (L/Cs):
Our asset-based lending program can include purchase order finance (PO finance). We can finance the purchase of goods to satisfy your customer purchase orders by providing your supplier with a letter of credit – our guarantee on your behalf. The letters of credit cover finished goods for sale to credit-worthy customers, with confirmed POs to you. In some cases, we can even provide cash on shipment for your suppliers.
Our industry expertise
Accord’s asset-based lending is ideal for a wide variety of industries across the United States and Canada. We have provided asset-based financing to a broad range of companies like yours, including manufacturers, wholesalers, distributors, retailers, importers, exporters and many others. Some examples of industry sectors where we have provided asset-based loans include:
- Food and beverage
- Retail and e-commerce
- Apparel and footwear
- Commercial and consumer lenders
- Professional services
- Waste and recycling
- Automotive parts and supplies
- Oilfield services
- Telecommunications and electronics
- Tourism and hospitality
- Plastics and industrial manufacturing
And Accord’s asset-based lending team works from coast to coast. Whether you’re based in a city like New York, Chicago, Los Angeles, Montreal, Toronto, Vancouver, or anywhere in between, you can count on us to consistently deliver flexible asset-based loans with speed and transparency.
The Accord advantage
When you choose Accord, you’ve got one of North America’s most experienced teams on your side. For nearly 40 years, we’ve served small and medium-sized businesses with cost-effective and timely asset finance solutions.
Make our expertise your advantage with our flexible asset-based lending program.
Grow with us
By working Accord’s asset-based lending team, you open the door to a range of financing options. Once we get to know your market, sales pattern and team, we can help take your business to the next level with additional cost-effective financing programs, including:
- Accounts receivable financing / Factoring
- Accounts receivable management
- Equipment finance
- Supply chain finance
- Small business loans
Asset-based Lending FAQ
Asset-based lending is a business loan secured by collateral (assets) such as accounts receivable, inventory, machinery, equipment or real-estate. Asset-based lending is also known as ABL, asset-based financing, or asset-based loans.
An asset-based loan, or line of credit, is secured by accounts receivable, inventory, machinery/equipment, and/or other balance-sheet assets. You can borrow a certain amount based on a percentage of the value of your assets which is determined by the lender usually working in conjunction with an appraiser.
Asset-based loans enable your business to leverage its assets in order to obtain working capital to finance growth, acquisitions, restructurings and turnarounds. As asset-based loans are not constrained by financial ratios or covenants you can typically borrow more under an ABL facility than a traditional credit line.
During due diligence, asset-based lenders will work with you to study your needs and your business plan, and, in particular, take a deeper look at the specific assets that you want to leverage in order to access additional working capital.
The rates on asset-based loans vary greatly from one transaction to the next. Typically, asset-based lending rates are based on the type of asset available as collateral, the level of risk and the financial performance of your business.
Factoring, also known as accounts receivable financing, is an advance on a business’ outstanding invoices (usually <90 days old). Therefore, factoring is technically a type of asset-based financing, where the business’ receivables act as the asset to secure funding from the lender. Many factoring companies will provide accounts receivable financing, but will not offer financing on other assets such as inventory or equipment.