| Produce Distribution Company | |
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$400,000 |
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Riviera Finance is one of
the few factors in North America that will consider doing "PACA" deals.
These are transactions in which the client is selling produce, and the
reason these deals are unique is that a government agency called PACA has
a degree of regulation over this industry. This fact scares away
most factoring companies because if you do not know what you are doing,
you can really lose you shirt! In this case our client imports produce from Mexico and resells it to quality customers (debtors) here in the US and Canada. These customers (debtors) are listed in an industry specific credit database of which Riviera is a subscriber. The crazy thing about these deals is how quickly they ramp up and then fall off the books. In a typical season this client will start October with no accounts receivable and end it with over $500,000! During a six month season it is not unusual for this client to reach almost $2,000,000 in receivables, so you can imagine what our credit managers are doing! The broker in this case is someone that has been in this market segment for a number of years and makes a living off of the 10-20 accounts that have thing kind of annual factoring needs. The representation he gives us is critical in not only booking the accounts, but also in keeping the customer service at a high level. |
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