How Choice Logistics Made the Right Choice with Asset-Based Lending
Content
- Meet Matthew McKeever
- Finding a partner to understand the vision
- Other challenges
- How debt and equity led to a true reversal of fortune…
- The secret of relationships
- The global supply chain crisis
- Lessons learned
- Advice for business owners
- The partnership between Gerber Finance and Choice Logistics
- Gerber Finance’s “Growth Tip of the Week”
Fact-checked by: Bruce Sayer
The phrase—“making a difference”—is used a lot, but it genuinely applies to Choice Logistics, an organization that provides worldwide transportation services to companies that provide critical infrastructure for banks, hospitals, and other essential service businesses. Jennifer Palmer, CEO of Gerber Finance, recently spoke to Matthew McKeever, CEO of Choice Logistics, where they discussed a variety of topics, including the benefits of asset-based lending (ABL) in Podcast 12: Partnership Spotlight: Gerber Finance and Choice Logistics.
Meet Matthew McKeever
Born and bred in Pennsylvania, Matthew, a “finance and accounting individual by trade” ironically states that it was never his ambition to be a CEO, but Choice Logistics presented him with a special opportunity that he accepted and capitalized on. As a CEO who happened to have a background in finance, Matthew found himself in the unique position of having professional experience as a CFO on his resume. He joined Choice Logistics at a challenging time when difficult decisions were being made, and found that he needed to address many financial concerns of the company. These concerns were answered when Matthew decided to partner with Gerber Finance.
Finding a partner to understand the vision
Matthew explained that one of the challenges was finding a financial partner that understood the vision and path of where Choice Logistics was headed. The professionals at Gerber Finance understood this vision and Matthew states that this was the best partnership he had ever formed with a lending partner—among many—in his career.
Other challenges
As stated earlier, Choice Logistics was facing many challenges when Matthew became CEO. These challenges only increased in 2018 and 2019, and included the need for extensive working capital to grow the company, supporting new clients, and significant restructuring and transforming of technology, among others. Difficult decisions abounded, with the dissolving of its partnership with its largest client perhaps the most difficult. Complementing—or compounding—these challenges were the realization that on-demand deliveries and the data storage market in the US market was shrinking. Through all of these difficulties, however, Gerber Finance was there to assist Choice Logistics every step of the way.
How debt and equity led to a true reversal of fortune…
As Gerber Finance has pointed out before, any healthy company should have a good balance between debt and equity. Choice Logistics has maintained the practice of reinvesting cash flow and equity back into the business. In the course of its partnership with Gerber Finance, Choice Logistics was $6 million in debt and had little more than $1 million in equity at the end of 2017. Today, this company currently has $9 million worth of equity—with a debt balance of $0.
The secret of relationships
Matthew believes that one secret to conducting a successful business centers on establishing and building on strong partner-focused relationships that will service the related markets. Focusing on these relationships builds the profitability profile of the business. Knowing from where he speaks, Matthew revealed that Choice Logistics has increased 15 percent in revenue, year-over-year.
The global supply chain crisis
Generally, the global supply chain crisis has increased the demand for the services provided by Choice Logistics, as many of its clients are creating equipment that is critical to infrastructure. And as supply chain routes have become inefficient, services of Choice Logistics are needed more than ever before. In the last 18 months, business has grown for this company. From a macro level, however, wages are under a great deal of pressure and recruiting has become more difficult and is taking longer to accomplish – although these are challenges being faced by the industry across the board.
Lessons learned
In relation to Matthew’s belief of how strong and healthy relationships among your customers and employees is key to all around success, he states that business and people are fundamentally the same, and that personal character is something that cannot be taught or learned. Character is the foundation for teamwork and collaboration, so the stronger your relationships are, the more productive your company will be.
Advice for business owners
In order to develop the strong relationships mentioned earlier, business owners who are just starting out must take the time to get to know their customers and understand how their businesses operate. By doing so, they will have a solid idea of how their businesses align with those of their customers. (Actually, this train of thought is also very much like that of Gerber Finance.)
The partnership between Gerber Finance and Choice Logistics
Matthew stated that Choice Logistics’ association with Gerber Finance turned out to the most valuable partnership of his career. The asset-based lending options provided by Gerber Finance were flexible, and by using accounts receivable as the basis for borrowing, Matthew was ultimately able to maximize liquidity. In short, this has been a beneficial partnership for everyone.
Gerber Finance’s “Growth Tip of the Week”
As Jenn and Matthew summarized the essence of their talk, they believe two points are essential to a business’ ability to grow. The first is maintaining strong relationships with your customers and employees. The second is to keep your finger on the pulse of technology and innovation, which can change quickly.
We hope you have enjoyed this blog, and we hope you listen or watch the podcast. (Oh, and after you are through listening to the podcast, remember to rate it!)
If you have any other questions or would like more information about Gerber Finance, feel free to send us an email at [email protected].
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