Quick Summary

Facility: $2,000,000 factoring facility
Structure: 90% advance rate, recourse factoring
Collateral: First-priority lien on accounts receivable (structured alongside an existing bank lender)
Industry: Transportation & Logistics – Contract Delivery and Time-Sensitive Business Shipments
Purpose: Provide working capital to support payroll, fuel, insurance, and operating expenses
Impact: Enabled the company to accept additional delivery volume while maintaining reliable operating capital

Company Overview: A Transportation Company Delivering Time-Sensitive Business Shipments

The company operates as a transportation and delivery services provider specializing in contract delivery and time-sensitive shipments for business customers. Its services support companies that rely on dependable transportation partners to move products quickly between distribution points, warehouses, and customer locations.

The company’s business model is built around completing delivery services first and billing customers afterward. In many cases, customers may take over 30 days to pay after a delivery is completed, depending on their internal payment cycles.

At the same time, the company must cover expenses immediately in order to keep routes running. Driver payroll, fuel costs, vehicle maintenance, insurance, and other operational costs must be paid on a consistent schedule regardless of when customers settle their invoices.

As delivery volume increased and the company secured additional contracts, managing the timing difference between outgoing expenses and incoming payments became increasingly important to sustaining growth.

The Challenge: Keeping Routes Running While Waiting on Customer Payments

As delivery volume increased and new routes were added, operating demands scaled quickly. More drivers, more miles, and higher day-to-day costs were required to support the growing number of deliveries.

However, payment for those deliveries was still collected weeks after the work was completed. While invoices reflected strong demand, the timing of those payments did not always align with the immediate costs required to keep vehicles moving.

As the business continued to expand, this gap became more pronounced. Without additional access to capital from completed deliveries, leadership faced a difficult decision: limit growth to preserve internal cash reserves, or find a way to fund expansion while waiting for customer payments.

Finding a Financing Partner That Could Support Continued Growth

As the company evaluated ways to support continued expansion, leadership began exploring financing options that could provide access to capital from completed deliveries.

However, the situation required more than simply adding another credit facility. The company already maintained a lending relationship with a traditional bank, which meant any new financing would need to work alongside the existing structure rather than replace it.

Introducing financing secured by invoices required coordination between lenders. Establishing the arrangement meant negotiating lien priorities and intercreditor terms so both financing providers could operate within clearly defined collateral rights.

The company ultimately sought a partner with experience supporting transportation businesses and navigating multi-lender structures. Porter Capital’s familiarity with transportation cash flow and its ability to work directly with the company’s bank made it possible to implement a solution that unlocked liquidity while preserving the broader lending relationship already in place.

The Solution: Structuring a $2 Million Factoring Facility Alongside an Existing Bank Lender

After reviewing the company’s billing patterns, customer payment timelines, and operating costs, Porter Capital structured a factoring facility aligned with the company’s delivery operations.

Instead of waiting weeks for customer payments, the company could access capital from delivery invoices shortly after services were completed. This allowed cash inflows to better align with ongoing expenses such as payroll, fuel, insurance, and vehicle costs.

Because the company already maintained a relationship with a traditional bank, Porter Capital coordinated directly with the bank to negotiate lien structure and establish an intercreditor framework. This allowed the factoring facility to operate alongside the existing bank loan while securing Porter a first-priority lien on accounts receivable.

Facility Details

Facility Size: $2,000,000 factoring facility
Advance Rate: 90% on eligible invoices
Structure: Recourse factoring facility
Collateral: First-priority lien on accounts receivable
Additional Flexibility: Extended recourse days for certain customers with longer payment terms
Bank Coordination: Intercreditor agreement established with the existing bank lender

The arrangement allowed Porter to finance accounts receivable while the company’s bank maintained its lending position against other assets.

Once implemented, the company could access capital from completed deliveries without disrupting existing customer payment terms or its broader banking relationships. The facility provided the liquidity needed to support increased delivery volume while maintaining day-to-day operations.

The Outcome: Confidence to Take on More Delivery Volume

With the $2 million factoring facility in place, the company gained reliable access to capital from completed deliveries. This allowed leadership to continue expanding routes and taking on new customer contracts without placing strain on internal cash reserves.

Equally important, the financing was structured in a way that allowed the company to maintain its existing bank relationship while accessing additional liquidity. This gave the business greater flexibility to grow without restructuring its broader capital stack.

As one company leader explained:

“Porter Capital helped us turn our receivables into reliable working capital. Their team understood transportation cash flow and structured a solution that worked alongside our bank, not against it.”

With financing aligned to the company’s billing cycle, leadership could focus on expanding delivery capacity rather than managing the timing of customer payments.

Financing Solutions for Transportation Companies Managing Payment Delays

Many transportation and logistics companies face the same challenge highlighted in this case study: deliveries are completed every day, but customer payments often arrive weeks later. At the same time, payroll, fuel, insurance, and other operating costs must be covered immediately to keep routes running.

For businesses in this position, financing tied to invoices can provide access to capital from completed deliveries, making it easier to maintain operations and take on additional volume without waiting for customer payments.

If your transportation or logistics company is facing similar timing challenges, Porter Capital can help evaluate financing options designed around your billing cycle and customer payment terms.

Connect with the Porter Capital team to explore how invoice financing could support your delivery operations and future growth.