I wanted to share a story with you about a recent client of ours. He is a pool contractor in Florida that had been in business for about three years. His business had been slowly growing but not at the pace that he wanted it to. He had a relatively good stream of business but it was mostly residential where the average job size was $15k to $20k. What he really wanted to do was crack into the large commercial market building pools for hotels and resorts. He knew he had the expertise but he lacked the capital to take on larger projects. Like most contractors he has to pay his material and labor costs while he is waiting to be paid. He could handle this on the smaller residential jobs but there was no way he could do it on a large commercial job. And like most entrepreneurs, his personal credit had suffered so that would be no help. Besides, he wanted to keep his personal finances and business finances separate.
He contacted us to see if we could help. After some discussion he elected to go through our TrueBuild Elite Program, our most comprehensive program. Why did he choose us? With over thirteen years in business and having worked with over 15,000 businesses he knew we had the expertise to get the job done right. In the Elite program you work with a team of professionals in our office. A Senior Business Credit Technician, a CPA and a Senior Funding Specialist. They take your business through the entire process to ultimately packaging you up and taking you to lenders that we work with to set up your credit lines and arrange your financing for you.
The Credit Technician worked with him on building and structuring his corporate credit profiles with all three of the major business credit bureaus. The CPA then took over on straightening up his financials and packaging him up to present to lenders, then the Funding Specialist got his first credit line set up. After about four months of participating in the program we were able to secure him a $75k working capital line of credit. This allowed him to win a bid on a $163k pool project for a hotel in Tampa. That led to another hotel project in Jacksonville where he won an even larger $242K job. Then, two more jobs in Sarasota totaling $313K. By servicing his initial credit line properly we were able to increase his line from $75k to $250k. Then he bid on and won his biggest job yet, a $917k job for a resort in Orlando, all in a twelve month period of time.
He went from doing about $350k a year in revenues to over $1.6 million. Having access to capital and credit is the life blood of any business, especially contractors. It is almost impossible to grow your business just based on internal cash flows. But navigating the business credit markets is complex and difficult and if you don’t know what you are doing you can end up doing yourself more harm than good.
Mike T. Berrien | Principal
Sales & Business Finance Consulting
TrueBuild Corporate Credit Program