Categories: Case Studies


Andy Cagle


For most of Melissa Merritt’s career in the scrap metal business, customers paid for the iron and steel that filled their furnaces in 30 days.

“I’ve been in this industry since I was nine years old,” said Merritt, now the Chief Information Officer (among other roles) at her family business, Industrial Scrap Processors, Inc. in Bessemer, Alabama. “We had always been paid on net 30 terms. Then one of our large buyers changed their payment terms to 45 days and then 90.”

The Problem

According to Merritt, the steel mill is a large customer and, for a time, the payment terms became so onerous that Industrial Scrap stopped doing business with them. For her company, the extensions were a double whammy since Industrial Scrap operates both scrap yards and much of the trucking and logistics to ship to the steel mills.scrap metal supplier increases liquidity with LSQ SCF program

“We have several suppliers whose product we buy go directly (to the one particular steel mill)” said Merritt. “That’s a problem when we are not getting paid for three months on our deliveries and we are paying (our suppliers) on 30-day terms.

“Our options were to come up with another plan, or just don’t ship to them anymore.”

As the customer is a large buyer, Industrial Scrap needed to find the former.

The LSQ Solution

In 2019, Industrial Scrap’s large customer implemented a supply chain finance program with LSQ to provide early payments to suppliers. Merritt saw it as a solution to their payment-terms problem.

“So, this was the other plan,” she said. “The broker we were working with explained how this would get us back to normal standards. That’s how we got involved with (the) LSQ (supply chain finance program).”

Maximizing cash flow with control and flexibility

While LSQ FastTrack® has options that allow for automatic payments that can be set by the supplier, Industrial Scrap took a different approach and chose to handle their cash flow in a more hands-on manner.

“I like the freedom to be able to pull down funds when we need them rather than on a set automated schedule. This week I might need to pull down everything that’s at least 60 days out, while next week I may not need the cash in hand to pay our suppliers or operating expenses.

“My job is to make sure that we’re maximizing income for everything to the best of our ability; if I set it for 30 days, I might not be doing that. So, if there’s a time that we can wait a little longer, I will.”

Operating with ease

With her busy schedule, the ability to easily make payment requests is key for Merritt. And with a background in information technology, she can be a tough critic of software solutions.

“The team who wrote your interface did an excellent job,” she said. “It’s very easy to use and logical. The steps to request payments are intuitive, and it’s a simple process to reconcile invoices from LSQ to our accounting system.”

According to Merritt, there were initially integration issues due to the complexity of their customer’s software, but the LSQ team helped get them resolved.

“We had trouble matching tickets based on the number of interfaces in the (customer’s) system,” said Merritt. “(LSQ Account Executive) Kathy (Waskowsky) and I put our heads together and were able to come up with a solution that solved the problem quickly.”

Advising Her Peers

Based on her experience with LSQ, Merritt says she would be quick to recommend the supply chain finance program to anyone in her industry.

“I’d tell anyone they better start using it,” she said. “LSQ gives you a ton of flexibility and control when you don’t have any normally.”


This program was made possible through an Export-Import Bank of the United States (EXIM) Supply Chain Finance Guarantee. The EXIM SCF Guarantee Program incentivizes lenders to fund supply chain finance programs for US exporters by reducing risk, increasing availability, and lowering costs.

LSQ is an EXIM-approved lender and supply chain finance platform provider.

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