Invoice finance facility for a growing labour hire firm

The situation

A labour hire business placing trades onto construction sites was invoicing around $620,000 a month on 45-day terms while paying its workers weekly. Growth had made the timing gap worse rather than better: every new placement widened the funding requirement. An unsecured loan had been used to bridge the gap and its weekly repayments were compounding the pressure rather than relieving it, so the directors wanted a structure that grew with the business instead of against it.

What we did

A term loan was the wrong tool — the requirement grew with revenue, so a fixed facility would need replacing every few months. We prepared a debtor ledger analysis showing customer concentration, average days to pay and dispute history, and presented it to invoice financiers rather than general business lenders. We compared confidential and disclosed structures given the client's concern about how customers would see it.

The outcome

A confidential invoice discounting facility was established with a $750,000 limit and an 80% advance rate, so the business collects its own invoices and customers see no change. The existing unsecured loan was repaid from the initial drawdown. The limit scales with the ledger, so continued growth no longer requires a new application each time a placement is added. Weekly wages are now funded from invoices raised the same week rather than from the previous month's collections.