The credit crunch of 2008 signalled the start of problems for Makin Metal Powders.
With 60% of turnover in the automotive sector, the company lost 40 - 50% of their business within a couple of months due to the downturn in that particular industry.
And as their customers began to feel the strain, the business suffered some significant knock–on effects to their cashflow. This resulted in the business entering Administration, with a subsequent MBO requiring finance to succeed.
ABN AMRO Commercial Finance tailored a solution that enabled the new business to hit the ground running.
“We needed someone who understood our business, because the nature of it is not run-of-the-mill,” John Boden, Managing Director of Makin Metal Powders commented. “As one of only a very small number of metal powder manufacturers, having a good insight into the industry is crucial - but it’s not something financiers will come across every day.”
A funding solution of confidential invoice discounting provided an initial £4.1 million of working capital, plus an Enterprise Finance Guarantee loan.
As the business moved forward, the loan and discounting facility increased to just over £6 million in line with an increase in turnover to £30 million.
"We needed someone who understood our business, because the nature of it is not run-of-the-mill"
Changing trajectory from the brink to a bright future, the company was able to hold on to loyal employees - some of whom had been working for the business for 25 years.
Makin Metal Powders was able to maintain a good working relationship with their customers and suppliers, and started turning their plans into action with the development of new products. As a result, the company turnover increased to £30 million and the business saw a distinct increase in new customers.
“We sell to 30 countries worldwide, which brings with it all of the associated currency issues,” explains John. “I’m not convinced traditional lenders would be comfortable funding that part of our business - but it seems to fit easily within ABN AMRO’s invoice discounting facility.”