“WE DELIVER” DESCRIBES BOTH SIDES OF A GREAT PARTNERSHIP
Liquid Capital’s Accounts Receivable Factoring solution facilitated growth for Overnight Expedite by financing $21 million in invoices and more than 1,400 customers.
In 2007, Alberta was booming. Overnight Expedite, a Canadian courier service based in Fort McMurray, Alberta, was a growing company with a niche market, delivering everything from documents to fully loaded skids with goods from southern to northern Alberta and back – overnight.
With business brisk, the company needed financing to ensure payroll and other operating expenses were met while it waited for customer payments. At the same time, its small staff faced major challenges, not only in simply getting invoices out in a timely manner but in managing the entire accounts receivable (A/R) process.
Overnight Expedite knew it had to do something to address its combined need for financing and accounts receivable management. The company concluded it would have to restructure and streamline some core business functions and, during those discussions, it began looking into the option of “factoring”.
“WE FIRST MET WITH LIQUID CAPITAL IN OCTOBER 2007. AT THE TIME, WE HAD JUST ADDED THREE NEW COMPUTER SYSTEMS; WERE GETTING ANOTHER TRUCK AND NEEDED MORE; AND WERE TRYING TO HIRE PEOPLE – DURING A SERIOUS ALBERTA TALENT CRUNCH – TO HANDLE INVOICING AND COLLECTIONS, WHICH HAD GROWN TO 300-400 INVOICES PER MONTH.”
Rob Kessler, Owner, Director of Logistics, Overnight Expedite
ACCOUNTS RECEIVABLE FACTORING ADDRESSED A RANGE OF GROWTH- RELATED FINANCIAL AND OPERATIONAL NEEDS
Overnight Expedite researched its options thoroughly and concluded that Liquid Capital’s A/R factoring solution – along with their ability to provide local representation, service and support – delivered the most streamlined, realistic approach to the company’s needs.
Overnight Expedite’s A/R situation provided some factoring challenges due to the many small invoices it routinely issued, but it soon worked out an arrangement where Liquid Capital would purchase and manage 100% of its accounts receivable. The first funding deposit of $64,000 was made quickly – by November 2007 – signaling the start of what would prove a strong, productive, lengthy relationship.
Liquid Capital went on to fund Overnight Expedite’s payroll every two weeks for almost eight years, with 200-350 customers on the books at any given time. From Overnight Expedite’s perspective, having a team to handle invoicing – and particularly to make the follow up/collection calls that might otherwise have been neglected – was vital to sustaining the company’s growth and long-term vision.
Ultimately, the A/R factoring solution financed $21 million in invoices and more than 1,400 customers, including everything from family-run restaurants, to large oil and gas companies, to major construction and engineering firms.
THE BENEFITS OF PARTNERSHIP EXTEND BEYOND FINANCIAL HELP
With the time to focus on business and the capital to ensure payroll and other operating expenses were covered, Overnight Expedite was able to expand into a number of Alberta communities independently – without having to rely on line- haul business from other companies.
Overnight Expedite was particularly impressed that Liquid Capital was not only willing and able to take on the large number of small invoices (some under $50), but that they continued buying and managing those low value invoices throughout the relationship. The company never had to set up or outsource an A/R department, and Liquid Capital was able to get Overnight Expedite’s customer payment cycle down to 45 – 60 days across the board.
GROWTH WAS THE BYWORD OF THE DAY
During their eight-year partnership, the company not only grew its business at an outstanding pace, but was able to purchase other local couriers whose receivables were also funded through Liquid Capital. And since, Overnight Expedite never carried a balance on its own vendor accounts, Overnight Expedite saved significantly on ongoing interest charges.
“When we started working with Liquid Capital,” says Overnight Expedite’s co-owner and growth guru Rob Kessler, “we had 12 trucks, 20 staff and serviced 20 communities in Alberta.
Now we have nearly 100 trucks, almost 120 staff and deliver to over 140 communities and 100 job sites.” Moreover, annual sales grew from $485,382 in 2007 to almost $8 million in 2015. Along with the business growth achieved, the Liquid Capital relationship led to some valuable supplier networking opportunities such as with Prime Capital, who has become a key partner for its truck leasing requirements.
“WE WERE ABLE TO GROW SUBSTANTIALLY AND SUSTAINABLY USING LIQUID CAPITAL PRODUCTS. WORKING WITH LIQUID CAPITAL – WHOM WE CAME TO CONSIDER A TRUE FINANCIAL PARTNER – WAS ONE OF THE BEST DECISIONS I EVER MADE. WE COULDN’T HAVE DONE IT WITHOUT THEM.”
Rob Kessler, Owner, Director of Logistics, Overnight Expedite
