CASE STUDY: MANUFACTURING

Home / Case Studies / CASE STUDY: MANUFACTURING

Our client manufactures plastic injection molding for the industrial and electronics industries. He has been in business for 20 years. Gross sales for 2014 were $960,000, after a dip in 2010 and slow steady growth since the Great Recession. Continued offshore competition requires upgrades in machinery to maintain tight margins.

GOALS

  1. Inventory of current equipment with updated depreciation schedule.
  2. Purchase new equipment with increased automation features.

CAPITAL REQUIREMENTS

$750,000 commercial line of credit for equipment purchase.

ACTION PLAN

  • Preparation and submission of tax returns for 2014.
  • Created Executive Summary with a detailed study on manufacturing.
  • Developed and implemented Debt Service Coverage (DSC) Ratio.
  • Monitor monthly Profit & Loss Statements in accordance with DSC Ratio.
  • Submission of loan package to banks.

OUTCOME

A commercial line of credit approved for $600,000 at 5.125% with an amortization period of 20 years and adjustment period of 5 years.

Comments(0)

Leave a Comment

This site uses Akismet to reduce spam. Learn how your comment data is processed.