https://www.youtube.com/watch?v=mT43r41dMB0
Fueling manufacturing growth and production
with flexible A/R financing
CLIENT OVERVIEW
In Q1 2025, a Milwaukee-based electronics manufacturer entered a period of accelerated growth, driven by increasing demand from electric vehicle (EV) suppliers and defense contractors. The company, known for its precision components and advanced circuit board assemblies, saw order volumes spike across all divisions. While the surge in business positioned the firm for record-breaking revenue, it also introduced serious liquidity challenges due to extended client payment terms and a growing need for upfront investment in people and production.
THE CHALLENGE
As new contracts were secured, the manufacturer needed to scale quickly by hiring specialized technicians, upgrading assembly lines, and sourcing high-cost inputs like semiconductors and specialty materials for aerospace and EV components. However, with customers operating on 60- to 90-day payment cycles, revenue delays strained cash flow. Rising payroll costs and supplier demands for deposits worsened the situation. Without immediate financial support, the company risked production delays, missed deadlines, penalties from OEM clients, and serious damage to its reputation.
THE SOLUTION
To bridge the gap between receivables and financial obligations, the manufacturer engaged with eCapital to implement a $14 million Accounts Receivable (AR) Financing Facility. This solution allowed the company to unlock cash tied up in outstanding invoices, providing immediate working capital based on billed but unpaid customer accounts.
Key features of the solution included:
- Non-dilutive financing, preserving ownership while accessing capital.
- Same-day funding on eligible receivables to match the pace of production needs.
- Flexible draw structure, enabling the company to scale its funding usage based on order volume.
This facility gave the company the breathing room it needed to:
- Meet growing payroll obligations without delays.
- Pre-pay for critical raw materials, securing supplier discounts and ensuring timely deliveries.
- Accelerate production schedules, staying ahead of tight OEM timelines and avoiding costly penalties.
THE RESULTS
With liquidity restored, the manufacturer was able to fulfill all major orders to its EV and defense clients on time throughout Q1 and Q2 of 2025, preserving critical OEM relationships and avoiding costly penalties. The improved cash flow also allowed the company to make early payments to suppliers, enhancing order consistency and strengthening long-term partnerships. Additionally, the financial flexibility supported workforce stability by enabling the timely hiring and retention of top engineering and technical talent. These combined factors contributed to a record-high quarterly revenue performance, setting the stage for continued growth and strong momentum into the second half of the year.
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