DCK DCK Cons Constructi truction on Case Case Study Study #1 #1 Background: • Formed in 2008, DCK is the largest construction/ general contractor company in the Pittsburgh, PA region • Industries served by DCK include hospitality, timeshare, multifamily/senior living, energy, sports, and retail • Company has consistently ranked among the Top 100 Contractors in the United States Company Challenges: • Highly cash flow constrained • Company struggled with stretched payables demand, less profitable terms, which constricted margins, operating leverage, and the company’s ability to generate new and profitable business FACTORING. FUNDING. FINANCING. Capstone | 2017 | 19
Cons Constructi truction on Firm Firm Case Case Study Study #1 #1 Capstone’s Solution: • Provided a Master Invoice Factoring Facility to inject the working capital required for supporting a larger volume of contracts • Provided PO Financing Facility Progress and Future Outlook: • Constraints drastically eased on cash flow • Timely payments are being made to vendors • Firm can now focus on the rapid growth of their company ‐ revenues have doubled on a monthly basis • Capstone is funding four projects: ‐ Four Seasons Resort in Bermuda ‐ $175,000,000 ‐ Atlantis Hotel in the Bahamas ‐ $19,000,000 ‐ Half Moon Bay Hotel in Jamaica ‐ $50,000,000 ‐ Ritz ‐ Carlton Napa Valley in Calistoga, CA ‐ $113,000,000 FACTORING. FUNDING. FINANCING. Capstone | 2017 | 20
Fo Four Seasons Seasons Re Resort, Bermuda Bermuda Capstone | 2017 | 21 FACTORING. FUNDING. FINANCING.
Engineering Engineering St Staf affing fing Compan Company Case Case Study Study #2 #2 Background: • In November 2015, Capstone met with a Temporary Staffing Company that places engineers in Fortune 500 service contracts • Engineers are placed at Qualcomm telecommunications centers and laboratories • Engineers complete time sheets and turn them into a third party monitor who submits the time sheets to Qualcomm • Qualcomm changed their payment cycle from weekly to monthly Company Challenges: • Company lacked sufficient working capital to make four successive payrolls without payment from Qualcomm • If a working capital solution was not achieved the Company would have to exit the contract • Needed working capital FACTORING. FUNDING. FINANCING. Capstone | 2017 | 22
Engineering Engineering St Staf affing fing Compan Company Case Case Study Study #2 #2 Capstone’s Solution: • Entered into a Master Factoring Agreement to provide working capital for payroll • Purchased weekly invoicing from the Company and used advance proceeds to fund payroll. Progress and Future Outlook: • Number of engineers employed under the Qualcomm contract is increasing. • Company is bidding on other technical staffing contracts with Fortune 500 customers • The company is confident it can bid on larger jobs even those it does not have capital for • Capstone looks forward to providing additional capital as additional contracts are won FACTORING. FUNDING. FINANCING. Capstone | 2017 | 23
Pr Private ate Label Label Out Outerwear ear Com Compan any Case Case Study Study #3 #3 Background: • New York City based outerwear company receives a $28,000,000 order from Costco Warehouse Club • Order received in November of 2016, goods deliver from March of 2017 through February of 2018 Company Challenges: • No banking relationship to open letters of credit • Lacks working capital to post cash collateral to open letters of credit • Need a letter of credit facility to support manufacturing of the goods in Vietnam • Logistics support for international and domestic shipment to all US, Canadian, and Mexican Costco distribution centers • Back office to collect accounts receivable from domestic and international shipments of goods to Costco FACTORING. FUNDING. FINANCING. Capstone | 2017 | 24
Pr Private ate Label Label Out Outerwear ear Com Compan any Case Case Study Study #3 #3 Capstone’s Solution: • Provided Trade Financing and a Factoring Facility • Set up an worldwide logistics platform to ship to each Costco market • Became the vendor of record to Costco • Issued $22,000,000 letters of credit to two Vietnamese manufacturers • Established an inspection regime to ensure only first quality goods were shipped to Costco • Streamlined order processing, billing, and payment through the purchase of subscription to an online database with Costco • E Progress and Future Outlook: • Costco indicating that additional $10,000,000 of orders for ladies wear be placed between September 2017 and November 2017 for fall and late winter delivery • Client has been given several additional styles from Costco to bid on for 2018 sales cycle FACTORING. FUNDING. FINANCING. Capstone | 2017 | 25
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