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• Purchase Order
• Equipment Leasing
• Import Financing
• Asset-Based Lending
• Future C.C. Receipts
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GETTING THE CASH TO FLOW by Kyle Swenson
by Inside Business, August 2007 Issue, Posted On 7.19.2007 (free registration
required)
Finding alternative financing sources can mean the difference between a growing or
stagnant business.
A yes or no answer at the bank can make or break any small business. But when credit
problems stand between your company and the working capital needed for success,
John and Maryann Doucette say its time to get creative.
“People don’t go out there looking for [answers],” says John, president of Liquid Capital
of Northeast Ohio. “If you’ve got a financial problem you don’t know what to ask for. That’
s really the challenge — the people that are our ideal clients don’t necessarily know we
exist. They don’t know the options are out there.”
More than a year ago the Doucettes started an area franchise of Liquid Capital in order
to guide local businesses through their financial growing pains. The couple offer
support to companies large banks turn away.
“We’re an alternative financing source,” John says. “So our target clients are folks that
are relatively new companies so they don’t have the track record that a bank would be
interested in, or maybe they are established and they’re growing faster than they have
been.”
Liquid Capital specializes in factoring, a form of financing new to many local businesses.
In this process, the Doucettes purchase invoices from their clients and give the
business an advance of cash based on the value of the invoices. Once they own the
invoices, the couple collect on the clients’ behalf and returns the balance, minus the fee.
“It’s an opportunity for our clients to accelerate their cash flow when they don’t have the
ability to actually get a line of credit from a bank and other conventional sources,” John
says.
Liquid Capital can take on anywhere from a single invoice to all invoices a client owns.
John says many smaller companies benefit when Liquid Capital assumes these financial
responsibilities because it allows the business owner to focus on other areas of
concern, says John.
“We do the collections and we do the cash processing. A lot of small companies
particularly don’t like to collect or don’t find the time to do collections, and a lot of big
companies don’t pay until you rattle their cage,” he says.
Factoring primarily works for companies engaged in business-to-business transactions,
such as manufacturers, importers, and trucking or staffing companies. The couple are
careful to only partner with clients who can benefit from the exchange.
“We don’t advise them on how to run their business,” says Maryann, who acts as Liquid
Capital’s vice president. “But we will tell them whether this is a fit or not.”
Liquid Capital evaluates potential clients by looking at their transactions. “The real key
is that our funding decisions are based on the credit quality of our clients’ customers,
not on our clients’,” John says. “So say somebody has a new business, but no business
credit and has poor personal credit because he has been using his credit cards to
finance the business. That’s okay, as long as his customers are credit worthy.
The Doucettes run the Northeast Ohio franchise of Liquid Capital from their Westlake
home. After working at BP for a number of years in information technology, John
decided to switch directions and start a new venture with his wife, who had worked as an
administrative secretary. A franchise broker led the couple to Liquid Capital, an
international franchiser based in Toronto. Liquid Capital has around 60 franchises
across the country.
“We own the business here, we’re able to use our own capital to fund our clients and we
get to make decisions locally,” John says. “But we have an internationally scaled back
office and support system behind us.”
The couple were attracted to the potential impact a Liquid Capital franchise could have
on Northeast Ohio’s economy. “The whole premise of the business is to take the funds
that we have been able to invest and invest them back into Cleveland, because
somebody’s got to do it,” John says.
Although banks and other financial companies offer factoring, the Doucettes say they
are in a better position to work with entrepreneurs and new businesses.
“We can afford to handle the small deals,” John says. “Other national businesses have
higher limits, so they might only work with a business that does $100,000 to $200,000 a
month in revenues, but we’ll go well below that.”
When Liquid Capital takes on a client, the Doucettes give their customers complete
access to their records online. Customers are also free to stop the partnership at any
time. The couple aims to support clients until they establish the credit needed for bank
support.
“We try to be as flexible as possible,” Maryann says. “Being small business-owners
ourselves, we understand the issue and the need for flexibility, the need to change
direction quickly.”
When Jamie Meskill, president of J.F. Meskill Enterprises, a household-goods importer
discovered his company’s working capital was tied up overseas after a product line in
China proved to be defective, Meskill turned to the Doucettes for help. “We were able to
price in the cost of working with a factor, and so we were paid in advance.”
Meskill says he’s surprised more small businesses haven’t taken advantage of factoring
services. “I think it has a negative connotation that really shouldn’t be there,” he says.
“What you have are just higher-margin businesses that want to turn their receivables
quickly. It’s a good way to get the cash flow running.”
John is also aware that many entrepreneurs hesitate to use alternative financing. “We’re
certainly trying to overcome a little fear of the unknown in people,” he says. “I think the
whole Northeast Ohio business attitude is conservative, so something that is unfamiliar
people tend to shy away from.”
The couple remind potential clients that factoring is fairly common in other markets
around the country and this form of financing has proven successful for new businesses.
Some area entrepreneurs seem to be getting the message. The Doucettes say many
potential clients who initially declined to partner with Liquid Capital have reconsidered.
“Really what we’ve been doing for the last year or so is getting the word out there that
there are alternatives,” John says. “If the bank turns you down, it isn’t the end of the
world.”
by Inside Business, August 2007 Issue, Posted On 7.19.2007 (free registration
required)
Finding alternative financing sources can mean the difference between a growing or
stagnant business.
A yes or no answer at the bank can make or break any small business. But when credit
problems stand between your company and the working capital needed for success,
John and Maryann Doucette say its time to get creative.
“People don’t go out there looking for [answers],” says John, president of Liquid Capital
of Northeast Ohio. “If you’ve got a financial problem you don’t know what to ask for. That’
s really the challenge — the people that are our ideal clients don’t necessarily know we
exist. They don’t know the options are out there.”
More than a year ago the Doucettes started an area franchise of Liquid Capital in order
to guide local businesses through their financial growing pains. The couple offer
support to companies large banks turn away.
“We’re an alternative financing source,” John says. “So our target clients are folks that
are relatively new companies so they don’t have the track record that a bank would be
interested in, or maybe they are established and they’re growing faster than they have
been.”
Liquid Capital specializes in factoring, a form of financing new to many local businesses.
In this process, the Doucettes purchase invoices from their clients and give the
business an advance of cash based on the value of the invoices. Once they own the
invoices, the couple collect on the clients’ behalf and returns the balance, minus the fee.
“It’s an opportunity for our clients to accelerate their cash flow when they don’t have the
ability to actually get a line of credit from a bank and other conventional sources,” John
says.
Liquid Capital can take on anywhere from a single invoice to all invoices a client owns.
John says many smaller companies benefit when Liquid Capital assumes these financial
responsibilities because it allows the business owner to focus on other areas of
concern, says John.
“We do the collections and we do the cash processing. A lot of small companies
particularly don’t like to collect or don’t find the time to do collections, and a lot of big
companies don’t pay until you rattle their cage,” he says.
Factoring primarily works for companies engaged in business-to-business transactions,
such as manufacturers, importers, and trucking or staffing companies. The couple are
careful to only partner with clients who can benefit from the exchange.
“We don’t advise them on how to run their business,” says Maryann, who acts as Liquid
Capital’s vice president. “But we will tell them whether this is a fit or not.”
Liquid Capital evaluates potential clients by looking at their transactions. “The real key
is that our funding decisions are based on the credit quality of our clients’ customers,
not on our clients’,” John says. “So say somebody has a new business, but no business
credit and has poor personal credit because he has been using his credit cards to
finance the business. That’s okay, as long as his customers are credit worthy.
The Doucettes run the Northeast Ohio franchise of Liquid Capital from their Westlake
home. After working at BP for a number of years in information technology, John
decided to switch directions and start a new venture with his wife, who had worked as an
administrative secretary. A franchise broker led the couple to Liquid Capital, an
international franchiser based in Toronto. Liquid Capital has around 60 franchises
across the country.
“We own the business here, we’re able to use our own capital to fund our clients and we
get to make decisions locally,” John says. “But we have an internationally scaled back
office and support system behind us.”
The couple were attracted to the potential impact a Liquid Capital franchise could have
on Northeast Ohio’s economy. “The whole premise of the business is to take the funds
that we have been able to invest and invest them back into Cleveland, because
somebody’s got to do it,” John says.
Although banks and other financial companies offer factoring, the Doucettes say they
are in a better position to work with entrepreneurs and new businesses.
“We can afford to handle the small deals,” John says. “Other national businesses have
higher limits, so they might only work with a business that does $100,000 to $200,000 a
month in revenues, but we’ll go well below that.”
When Liquid Capital takes on a client, the Doucettes give their customers complete
access to their records online. Customers are also free to stop the partnership at any
time. The couple aims to support clients until they establish the credit needed for bank
support.
“We try to be as flexible as possible,” Maryann says. “Being small business-owners
ourselves, we understand the issue and the need for flexibility, the need to change
direction quickly.”
When Jamie Meskill, president of J.F. Meskill Enterprises, a household-goods importer
discovered his company’s working capital was tied up overseas after a product line in
China proved to be defective, Meskill turned to the Doucettes for help. “We were able to
price in the cost of working with a factor, and so we were paid in advance.”
Meskill says he’s surprised more small businesses haven’t taken advantage of factoring
services. “I think it has a negative connotation that really shouldn’t be there,” he says.
“What you have are just higher-margin businesses that want to turn their receivables
quickly. It’s a good way to get the cash flow running.”
John is also aware that many entrepreneurs hesitate to use alternative financing. “We’re
certainly trying to overcome a little fear of the unknown in people,” he says. “I think the
whole Northeast Ohio business attitude is conservative, so something that is unfamiliar
people tend to shy away from.”
The couple remind potential clients that factoring is fairly common in other markets
around the country and this form of financing has proven successful for new businesses.
Some area entrepreneurs seem to be getting the message. The Doucettes say many
potential clients who initially declined to partner with Liquid Capital have reconsidered.
“Really what we’ve been doing for the last year or so is getting the word out there that
there are alternatives,” John says. “If the bank turns you down, it isn’t the end of the
world.”
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LIQUID CAPITAL OF
NORTHEAST OHIO
ANNOUNCES NEW
FINANCING
PROGRAMS FOR
SMALL BUSINESSES
NORTHEAST OHIO
ANNOUNCES NEW
FINANCING
PROGRAMS FOR
SMALL BUSINESSES
- Read More >>
LIQUID CAPITAL OF
NORTHEAST OHIO
ANNOUNCES THREE
NEW CLIENTS
NORTHEAST OHIO
ANNOUNCES THREE
NEW CLIENTS
- Read More >>
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