Fueling Retail Growth: How P/O Financing Helped a Sauce Brand Deliver on a Major Costco Order

The Situation

A West Coast-based construction company specializing in excavation, masonry, and underground utility work was expanding rapidly, taking on larger projects with general contractors and developers. A key focus was on water, storm, and sewer utility upgrades, as well as subcontracted work for generator substation renovations. With projected sales growing from $1.66 million in 2024 to a $3.5 million target for 2025, the company needed to accelerate its cash flow to support hiring more employees and managing ongoing projects. However, with payment terms extending to 40 days and milestone billing on multi-month projects, cash flow gaps made it challenging to scale effectively.

The Solution

SouthStar Capital provided a flexible Accounts Receivable (A/R) Factoring Facility, allowing the company to selectively factor invoices when needed. By leveraging this financing, they could quickly access working capital from their $50,000 in outstanding invoices, reducing the impact of delayed payments from contractors. The ability to fund invoices on a case-by-case basis gave them the control to manage cash flow efficiently while maintaining flexibility in their financial strategy. 

The Result

With SouthStar’s support, the company was able to speed up its cash flow, ensuring payroll and operational costs were met without interruption. The additional liquidity allowed them to hire more employees and take on larger, more complex projects, positioning them for sustained growth. By reducing reliance on slow-paying invoices, they gained financial stability and the ability to scale operations without cash flow constraints.