A client that we have funded vehicles before approached us for a term loan to buy more stock.
They are a re seller of mattresses. They have an opportunity to supply a large chain hotel on a regular basis but have to hold more stock especially the more popular items.
Rather than a term loan that needs to be repaid and once spent, it is gone, we suggested a stock finance facility as they already hold a lot of stock.
We were able to secure a loan facility to borrow money against their stock and the more stock they held, the more they could borrow.
This worked out perfectly for them as it allowed them to build up the additional stock they needed and was secured against their existing stock.