Aerospace Contractor Factoring - Aviation Factoring
Aerospace Factoring as a Reliable Source of Working Capital
Whether you’re a parts broker, repair facility, or other service provider, the aerospace and aviation industry sales cycles can be notoriously long, and payment terms can stretch for months. Cash flow challenges are given for most businesses in the Aerospace industry; materials, labor, and operational costs are daily burdens that must be met.
Real World Success Story: Accurate Machining
Effective Financing Takes Precision
Accurate Machining, Inc., a 30-year-old machine shop specializing in the aerospace industry, recently received two multi-year contracts with large aerospace manufacturers. “We spent months on engineering and prototype designs and even more time building rapport with these potential customers… finally, all of our hard work paid off. During the time spent winning their business, we spent large amounts of cash on new equipment and activities that generated no revenue. When we won the contracts, we had a new problem.”
During the months spent working on the prototypes, Accurate operated unprofitably. Unfortunately, their bank was unable to increase their credit facility. “We have a great relationship with our bank, and when they could not help, I was devastated. Thankfully, our bank had partnered with Gateway in the past and had an alternative to support our needs… almost overnight. Now we have a reliable source of working capital to support our growth.”
Accurate Solutions Down to the Millimeter
Factoring provided Accurate Machining with a way to maintain liquidity during a critical period. By selling their unpaid invoices to Gateway Commercial Finance, they were able to access cash tied up in accounts receivable. This financial solution allowed them to obtain the working capital necessary to fulfill contracts without incurring additional debt or waiting for slow-paying customers.
The Benefits of Factoring for Aerospace and Aviation Contractors
Gateway Commercial Finance provides more than just working capital. For aerospace contractors, factoring is a strategic tool that addresses several critical financial pain points:
- Improved Cash Flow: Factoring turns unpaid invoices into immediate cash, which is crucial when managing long sales and payment cycles. This cash flow solution helps cover daily operating costs, purchase materials, and pay staff without waiting months for customer payments.
- Avoiding Additional Debt: Unlike traditional bank loans, invoice factoring is not a form of debt. This allows your aerospace company to access the funds when needed without increasing liabilities or impacting your credit rating.
- Funding Capital-Intensive Projects: Aerospace contractors often need to invest heavily in new technologies, equipment, or R&D before generating revenue. Gateway’s factoring service helps fund these capital expenditures without straining their cash reserves.
- Mitigating Project Delays: The aerospace industry is rife with project delays due to the complexity of design, engineering, and regulatory approvals. Factoring provides the financial flexibility to continue operations and cover expenses, even when project timelines stretch.
- Reducing Supply Chain Risk: Aerospace contractors rely on expensive materials and specialized suppliers. With factoring, you can purchase materials in advance and mitigate supply chain disruptions without waiting for incoming payments.
Gateway Commercial Finance: Comprehensive Aerospace and Aviation Factoring Solutions
Gateway Commercial Finance specializes in assisting businesses like Accurate Machining maintain steady cash flow and financial flexibility. Our invoice factoring services are customized to meet the specific needs of industries with lengthy sales and payment cycles. Our aerospace and aviation factoring program includes:
- Experienced: We’ve funded parts brokers, staffing companies, repair facilities, and distributors within the Aerospace business. We understand your business and, more importantly, your customer base.
- Fast Funding: We purchase your unpaid invoices from creditworthy customers, providing you with immediate access to cash. Our same-day-funding service allows you to cover expenses without waiting for customers to pay.
- Flexible Agreements: As your business grows, so does your factoring line. We adjust the funding available to meet your increasing cash flow needs.
- Non-Recourse Factoring: Some contractors may be eligible for this service type. With this option, we assume the credit risk if your customer defaults, protecting you from bad debt.
- Low Factoring Fees: We offer highly competitive factoring rates with high advance rates.
- Fast Approvals: We provide speedy application turnover, often within 24 hours.
Keeping Aerospace Contractors Competitive
Companies in the aerospace industry must maintain liquidity to remain competitive and take on larger contracts. By factoring through Gateway, aviation and aerospace contractors can achieve the financial stability necessary for growth and confidently pursue additional contracts, knowing they have a reliable source of working capital.
Contact Gateway Commercial Finance Today
Gateway Commercial Finance is more than just a financial service provider; we are a strategic partner dedicated to helping your business grow. If you’re an aerospace contractor facing cash flow challenges or preparing for your next big contract, now is the time to explore the advantages of invoice factoring.
Contact our decision maker or call 1-855-424-2955 to learn how we can turn your receivables into the cash flow your business needs to thrive.