Growing your business during a pandemic is challenging for most. Add to that your bank unexpectedly discontinuing funding and high customer concentration impeding your ability to acquire capital from other banks, and "hopeless" may seem more fitting. That's the scenario Seville Farms faced in late 2019 after landing a Fortune 500 client. This blog post outlines their story and how, with help from LSQ, they overcame each one of these obstacles to become one of the largest greenhouse operations in the U.S.
When Billy and Bobby Brentlinger launched Texas-based Seville Farms in 1994, the brothers were on a mission to deliver high-quality plant products to big-name retailers. Through hard work and tenacity, the garden center supplier won contracts with well-known big box, grocery, and discount stores throughout the Lone Star State; gradually expanding into Oklahoma, Arkansas, and New Mexico. Things really started to take off when Lowes, one of the largest home improvement retailers in the United States, came to Texas. The Brentlingers seized the opportunity and signed Lowes as a client, eventually accounting for 95% of their business. This created the ideal climate for them to expand and diversify.
For years, Seville Farms had relied on a bank to manage cash flow and provide liquidity. That unexpectedly changed when they learned the bank would no longer finance businesses in their industry, regardless of existing arrangements. After exploring their options, Billy and Bobby realized that Seville Farms was considered unfundable by traditional lenders due to its high customer concentration. Having to phase out of their line of credit (LOC) and facing a potential liquidity shortage, they reached out to an investment banking firm who recommended LSQ.
Seville Farms began working with LSQ in 2017 after discovering that their high customer concentration was not a dealbreaker to obtain funding. They received a $15 million facility and 90% advance rate to continue operations, manage seasonal demand, and stimulate growth. Seville Farms also secured additional capital with an inventory LOC via LSQ’s specialty finance network. In addition to having optimized cash flow, the company's Controller, Dianne Kelm, values LSQ's team of business funding experts and robust AR management platform, Dashboard—
"LSQ knows that we need funds by a specific date, and they stay on top of it. Dashboard is intuitive and easy to use. Any AR information that I need is right there!"
Seville Farms experienced a spike in demand during the Spring of 2020 when Americans took to gardening as a means of spending time outdoors during COVID-19. Thanks to their relationship with LSQ, they were able to fulfill larger orders and increase cash flow during the pandemic. Billy recalls,
“The business had a week where we sold $5 million worth of product, and we had never sold more than $4 million in any one week. We didn't have any trouble drawing on those funds.”
Today, Seville Farms is one of the largest greenhouse operations in the U.S., and the Brentlinger brothers are well on their way to securing a new bank LOC thanks to LSQ.