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Room For Your Big Ideas: How to Use Bridge Financing to Upgrade Your Manufacturing Space | Socotra Capital - Hard Money Loans and Real Estate Lending

Written by Adham Sbeih | Oct 21, 2015 10:14:34 PM

There’s nothing more frustrating for manufacturers than realizing that their existing production space isn’t big enough to fit their dreams. If you run a manufacturing business, you’ve probably experienced this: you’ve just designed the next great thing. You know that clients will scramble for it, and your customers are going to love it. But one problem. You don’t have the production line space to manufacture it.

The problem is that as your market changes, so do the demands of your customers. A stagnant company will lose business to competitors, so you must grow in order to keep your profits coming in. That creates a Catch-22: you can’t expand without capital, but you can’t generate more capital until you expand. You need that extra cash flow to adapt and stay ahead of the competition. Where can you find the liquidity to push your production forward?

Bridge the Gap Between Your Current and Future Production Needs

Your idea came before your means. You have the blueprints but cannot assemble the product. You need to upgrade your facilities, but the bank won’t touch you, and maybe you’re starting to worry you’ll have to shelve your idea. But you don’t have to. A Socotra Capital bridge loan gives you instant cash to finance your facility expansion, which enables you to begin manufacturing your idea. This gets the final product out there for sale, which finances the payback of your bridge loan.

How Bridge Loans Work

Part of the federal government’s Great Recession bailout program was to help save American auto manufacturers that were at risk of folding completely. It issued bridge loans to two of the country’s most prominent and long-standing automakers: Chrysler and General Motors. Both companies used the bailout money to finance facility improvements for increased production. This created new jobs to boost the economy, and Chrysler and GM quickly found themselves back in the black. In fact, Chrysler’s sales increased so much, they enabled the company to pay back the federal government’s bridge loan six years ahead of schedule.

The White House reported that the federal government’s version of a bridge loan got the ball rolling on an American automotive industry comeback. Since both auto manufacturers emerged from bankruptcy, they have collectively hired 115,000 employees, which is the greatest increase in job growth since the 1990s. Both companies are turning over a profit again and gaining ground on Wall Street for the first time since 1995.

But I’m Not Qualified for Federal Bailout Funding

Even if you have great credit history, you might not qualify for bank funding. Banks can also reject your loan if your project doesn’t fit their scope, or they don’t understand your vision. That’s what we’re here for. Socotra Capital offers private “bailout” funding, so to speak, so you don’t need a government loan to finance your facility expansion. In fact, private financing can better meet your needs, because we work directly with you. When you get a loan from Socotra, we review your blueprints, discuss any possible related costs, and work with you to find the best bridge loan and payback option.

Federal grant money is highly regulated, and the competition is tough. You shouldn’t have to give up on your idea. With Socotra Capital, you can take a hard money bridge loan to cover the remodel and manufacturing costs of your new product, and boost your personnel so you can turn your idea into a reality. The key is to get your product made and out onto the market, so you can bump your business’ revenue and take your company to the next level.

Don’t let lack of production space or personnel keep your next great thing on the back burner. Socotra Capital is a private lender that specializes in bridge loans for commercial use. You can secure the money you need to upgrade your current facilities using equity-based financing and increase your production and, thereby, your profits. Move your business forward and back on top of your competitors with a Socotra Capital bridge loan.