New Play on Aerospace Financing – Case Study

Cash flow problems are some of the most common difficulties small businesses encounter. Yet it doesn’t necessary mean that they are not profitable. Profit is the surplus after all expenses are deducted from revenue. Cash flow, on the other end, is the inflow and outflow of money from a business. It is the cash necessary to pay employees, operating costs and purchase inventory. This lack of liquidity is a common challenge for inventory based businesses.   Case Study: Industry: Aerospace   Subject: Aftermarket aircraft-parts supply company   Circumstance: Having to maintain a sizeable inventory to satisfy regular demand which ties up a large portion of its cash, the company approached Altima Business Solutions in order to quickly complete the purchase of expensive aviation parts to fulfill an out-of-the-ordinary order from one of its regular clients for a generous profit. Many aviation/aerospace companies with less than $5MM in sales find it difficult to maintain a solid banking relationships for lines of credit and other credit facilities. Banks have not fully engaged the aerospace/aviation industry as suitable risk. Much education must be undertaken by the banking community to fully understand the risk and high rewards that come from this sector. With that being said, Altima Business Solutions was able to develop and execute a solution for the company that allows for sustainable growth.   Solution: In less than two weeks, Altima Business Solutions structured a financing agreement with one of its in-network lenders and negotiated a term sheet to the satisfaction of the company. Solely based on the company’s existing inventory, the lender provided them with a $700,000 credit facility that has the capability to grow as...