Accounts Receivable / Inventory Lending

This option can give you more control over the credit terms you extend. Because your inventory is decreased proportionately by the dollar amount of receivables created during sales operations, these two are often combined under one collateral agreement.

Type of Inventory

The terms and condition of your credit will depend on a myriad of factors, one of which will be the type of inventory you have. considerations such as perishability, mobility and the control the lender will have. Also your business operating cycle plays a big role. Your collateral agreement may range from a blanket lien (UCC1) to a bonded warehouse with mechanics set up for workflow between sales, receivables and debt retirement. You get to keep more out of each sales dollar with this credit facility.

Quality and Aging of Inventory

As your business operations are analyzed in conjunction with financials such considerations will be applied as the demographics of your customers, e.g. are they public utilities or are the consumers (quite a range). Receivables turnover and default rates. For larger credit payments will be directed to the lender lock box which is known as your cash collateral account. Moneys are debited from this account to retire your debt based on a preset formula established in your loan agreement.

Loan Process

GPA Capital has handled some of the largest credit facilities of this kind ranging from import/export companies to car dealers as well as small to medium sized business. All facets of the business, including marketing, growth strategy, variable budgets and management expertise are considered. This loan product is well utilized for leveraged acquisitions.