Huntington Coast Capital Obtains $250,000 Factoring Facility For Growing Apparel Company

Huntington Coast Capital Obtains $250,000 Factoring Facility For Growing Apparel Company

An upcoming menswear line was growing and needed outside funding in order to meet demand. They locally source all of their fabrics from a number of fabric suppliers and manufacture the goods all in Los Angeles. Their supplier’s cash up front requirements put a strain on their cash flow and they needed to do something fast in order to capitalize on the opportunity. Huntington Coast Capital was able to piece together a factoring facility within two weeks time to meet their cash needs and manufacturing deadlines. The company is now well set to grow the company and take their operations to the next level.

About the company:

LAUNCHED – 2012, a new menswear project based in Los Angeles, California

INSPIRATION – Traditional menswear, vintage classics, military uniforms and athletic sportswear.

PROCESS – Juxtaposing vintage garments with new fabrics and materials to create modern silhouettes.

COLLABORATION – With local artisans and craftsmen to complete the garment making process. Each item is often pieced together and finished by hand.

RESPECT – The distinguishing characteristics, quality and durability that only clothing and fabrics from another era can offer.

TRIBUTE – Each new collection is a tribute to the journey these garments have traveled. It is re-purposed and made modern with the intention of giving them new life for a new era. And the journey begins again.

If your company could benefit from a creative capital solution, call us 714-719-8966.

Business Loans and Satisfied Clients

Business Loans and Satisfied Clients

Huntington Coast Capital has specialized in securing business loans, equipment loans, inventory loans, SBA loans and purchase order financing in California for business owners since 2011. We are good at what we do, but do not take our word for it, listen to our clients! We secured a $6,500,000 line of credit for Penguin Foods that reduced their cost of funds and allowed them to grow their business well in to the future. Click the image for the video testimonial:

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$400,000 Equipment Loan Secured For Tenant Improvements

$400,000 Equipment Loan Secured For Tenant Improvements

Huntington Coast Capital headquartered in Huntington Beach, CA announced today that it secured a $400,000 equipment loan to complete tenant improvements at an existing client’s business location. The loan was secured under an equipment loan structure through one of HCC’s established capital partners.

“Huntington Coast Capital was able to secure a loan that no other lenders were interested in” the company president said in a post closing interview. This particular equipment loan, while classified that, was more of a bridge loan secured by in-wall plumbing and fixtures for a cold storage tenant improvement build out.

From a collateral perspective it was very different than your typical equipment loan. In most equipment loan scenarios, the collateral is either rolling (trucks and trailers, etc) or bolted in to the ground (as in a manufacturing or other equipment intensive business). Adding to the creativity in this loan closing was the fact that all of the company’s other assets were tied up under a blanket lien by the senior lender. Lastly, the landlord waiver took a bit of negotiation as the “collateral” for the loan was largely in-wall or built in to the wall making the landlord waiver to enter the property and reclaim any collateral in the event of default, much more difficult.

In the end, Huntington Coast Capital had a happy client and another successful equipment loan closing. If your business could use some additional capital to grow, please call us 714-719-8966.

HCC Obtains $800,000 Equipment Loan

HCC Obtains $800,000 Equipment Loan

RECENT FEATURED TRANSACTION:
A Texas-based company contacted our Huntington Beach location regarding an equipment loan. The company was a supplier and installer of large water tanks for commercial and industrial use. The main applications of their product was for rain water harvesting, well water storage, fire water storage and municipal water storage. Their customers ranged from breweries to large farm co-ops to City Municipalities. Their business is growing and their brand is becoming well-known.

The challenge: The company was running in to a ceiling when it came to their growth potential. The supplier they worked with was located in Australia and had minimum shipment requirements and needed cash up front for the orders. The typical sales cycle (from ordering from supplier to delivering and being paid by the customer) could run as long as 4-6 months. This, coupled with net losses from operations as the company went through growing pains, made them unfit for bank financing.

After applying for and being turned down for an SBA loan, Huntington Coast Capital brought in some forward looking, entrepreneurial lending options. The lender ultimately chosen by our client provided for the cash to purchase the inventory by leveraging existing equipment and freeing up cash trapped in the assets of the company.

The result: A cash injection was possible by leveraging the company current equipment and inventory assets which resulted in being able to fulfill the increasing customer orders. Our non-institutional solution will bridge the company for 12 to 18 months and allow the company to make that jump to profitability. They will likely be ready for traditional financing within a two year time period.

If your business could use a cash injection to take your operations to the next level, we would like to speak with you. Click the Apply Button below to inquire about the details.

SBA Loans The Advantages and Disadvantages

SBA Loans The Advantages and Disadvantages

The SBA or Small Business Administration is a government sponsored funding program for business operations, commercial real estate and construction projects. Whether you are looking for an SBA loan right here in our hometown of Huntington Beach or anywhere in the USA, an SBA loan may be of value to you.

What is an SBA Loan?

SBA loans are generally described as funds available for working capital or equipment purchases that will contribute to the growth of a company’s operations. Working capital is a broad term covering everything from marketing and advertising to hiring and other capital investments.

The SBA does not lend money directly to business owners. Participating banks originate, underwrite and lend money under the program to qualified applicants. SBA loans made by banks are partially guaranteed by the US government.

Who Qualifies for an SBA Loan?

A business that would qualify for an SBA loan would have the following general characteristics:

a minimum of two years in business
at least two tax returns showing a business profit (more on this later)
adequate financial strength of the business relative to the loan amount being requested
personal credit scores above 690 for each owner in the business
outside collateral in the form of equity in a personal residence (sometimes required)

This is by no means an all inclusive list, but some of the main pre-requisites in qualifying for an SBA loan.

Is an SBA Loan Right for My Business?

SBA Loans are a great source of low cost capital for many businesses. If you can check all the boxes required for an SBA Loan, it is a great way to responsibly leverage your company for growth.

Whether or not an SBA Loan is right for your business has many variables. For example, a popular SBA Loan is the SBA 7(a) Loan. This SBA Loan variety is more commonly offered by banks for companies looking for term debt (lump some of cash – think mortgage) versus revolving credit. While the SBA offers revolving lines of credit under the SBA 7(a) Program, our experience is that banks do not offer the revolving loan as widely as the term debt.

If you are looking for a revolving line of credit for your business, there are more flexible and user-friendly loans available.

What Else Should I Know When applying for an SBA Loan?

Here is where the tax return profits come to play. It is natural for business owners to want to minimize the profit they show on their tax returns for tax purposes. This is an effective way to reduce your tax obligations, but not good when searching for an SBA Loan.

This is because the banks that underwrite the SBA Loan request will look to the tax returns to determine whether or not your business can afford to take on the payments of the new SBA Loan. If you are showing very little profit or losses on your tax returns, you are declined before the process even starts.

Advantages of SBA Loans

The advantages of SBA Loans are simple – low cost source of funds to grow your business. Business owners like the program due to the low cost involved with these loans. In addition, there are seldom pre-payment penalties attached to them.

The banks like the SBA Loan Program because the government is guaranteeing a portion of their exposure which makes the program attractive to those participating banks that are lending the money.

Disadvantages of SBA Loans

The disadvantage of SBA Loans is that they are hard to qualify for. Only the financially strong qualify for SBA Loans. They are accompanied by a fair amount of paperwork and hurdles to clear for underwriting. We have found that roughly half of our SBA Loan submissions make it through the finish line and that is because most are dis-qualified prior to submission.

Closing Thoughts on SBA Loans

We are big fans of SBA Loans and always use them as a starting point when consulting with our clients. If we can get you qualified for an SBA Loan, the rates and terms will be hard to beat. Further, the good news is that there are other forms of financing available should we need to use an alternative source to bridge to a future point where the company may qualify.

If you would like to see if your business would qualify, please call me directly at 714-719-8966.