The key to being successful on RMP Capital Corp’s Accounts Receivable Funding Program is what the business does with the money. In other words, since Accounts Receivable Funding essentially puts a business on a cash basis, no longer waiting for customers to pay their invoices, the difference is how those funds are employed.
The following is an actual case study (wholesale business using our program):
- Wholesaler of specialty interior build-ing products selling to contractors and doing some fabrication.
- $3,000,000 annual sales
- Days Sales Outstanding:
- Market — Existing facilities and staff can support 30% sales growth
- Gross profit - 24.6%, net profit - (1.2%)
- Material costs: 44.4% of sales
- Misses early-pay/bulk vendor discounts
- Max’d out $250K line of credit
- Have cash flow to support 30% growth
- Take advantage of 4.5% early-pay plus 7% bulk vendor discounts
- Get “debt-free”
90 Day Results:
- Vendor discounts re-negotiated for discounts
- Bid activity increased, growth imminent
- Now “debt-free”
Future Profit & Loss Projections:
3,900,000 (@ 30%)
1,150,000 (@ 30%)
(36,000) or (1.2%) (before)
164,000 or 4.2 % (@ 30%)
This is just another example of how a business that had opportunities to employ a strategy of reinvesting cash on a daily basis could, not only offset the higher funding fees, but increase net profit!
RMP Capital Corp, headquartered on Long Island, NY, provides a hybrid, turnkey Accounts Receivable Funding and Purchase Order Financing Program that banks can refer to their customers and prospects at no risk or cost! It is an alternative to traditional bank financing specifically designed to increase cash flow and fund growth companies. It’s a great way for community bank’s to grow deposits and generate recurring fee income revenue!
Visit us online to learn more: http://www.RMPCapital.com