An Arizona supplier finds early payment can provide much-needed cash flow during times of expansion or crisis.
When Shelia Shaw first began accelerating receivables through the C2FO platform five months ago, it was to help fund the rapid expansion of her business, Arizona Bakery Sales & Service, into three additional southwestern states.
Lately, though, she has used early payment through C2FO for a more pressing need: meeting payroll in the event that her Mesa, Arizona-based company is required to close because of the COVID-19 pandemic.
For now, family-owned Arizona Bakery, which services and repairs commercial food equipment for grocery stores across six states, is deemed by the local government as an essential business.
That designation could change at any time, Shelia said. Accelerating payment on receivables from Walmart at a reduced rate through C2FO will help ensure that her 13 employees continue to be paid in the event of a shutdown.
“If we have to stay at home, I don’t have to do anything more than just email my payroll company and say, ‘Get everyone paid.’ I now have the funds in place to do that,” she said.
Funding in the midst of a crisis
Like many U.S. small- to medium-sized businesses, Arizona Bakery has quickly shifted its goals and priorities in response to the rapid spread of the coronavirus pandemic. While demand for servicing food equipment like fryers, ovens, mixers and slicers remains strong from grocery store chains, Shelia expects to see a decline in business from restaurant and resort customers that have been hit hardest by the crisis.
Shelia first learned about C2FO from Walmart, her company’s largest client, last year. In November, she began participating in Walmart’s early payment program through C2FO as a way to help fund Arizona Bakery’s expansion to serve more Walmart stores throughout the Southwest.
“That required a lot of extra funds getting pulled. With C2FO, I could go in and select what invoices I wanted to pull in and when I needed them,” Shelia said. “It’s more convenient than a line of credit. It prevents you from having to take out that loan, it’s a lower interest rate and it’s a faster way to get funding.”
Shelia’s contact at C2FO is Supplier Relationship Manager Alex Fleischman. He said Shelia quickly picked up on how receiving early payment from Walmart on select receivables could help fuel her company’s expansion.
“Since then, we’ve spoken on a fairly consistent basis about when and why she would like to pull in funds,” Alex said.
When C2FO and Walmart launched a new early payment program aimed at helping small- and medium-sized businesses affected by COVID-19 to build more liquidity at a reduced rate, Alex encouraged Shelia to opt into the program immediately. Having the cash flow to pay her highly skilled technicians during a possible shutdown is essential to getting Arizona Bakery up and running quickly once the crisis ends.
“That program is really beneficial for this whole issue that’s going on right now because otherwise I don’t know what we would do,” Shelia said.
The bottom line
An early payment solution like the C2FO program with Walmart can be a vital source of capital in times of growth or great difficulty. Arizona Bakery is one of many suppliers that has turned to C2FO for much-needed cash flow during the current economic crisis.
For more information about C2FO’s funding solutions, click here.