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EXIM Helps Arizona Company Increase its Line of Credit

Exporter/Customer: 
Competitive Engineering Inc.
Export Destinations: 
Mexico and the Philippines
EXIM Bank Product: 
Working Capital Loan Guarantee
Export Sales: 
40 percent of total sales
Jobs Created: 
2
Jobs Supported: 
44

Competitive Engineering Inc.

Competitive Engineering Inc. (CEI) is a small business manufacturer of precision-machine components for a variety of customers, particularly in the aerospace and data-storage industries. Based in Tucson, Arizona, CEI provides engineering and manufacturing solutions to a diverse world market. The company is owned by Don and Charlotte Martin and has a staff of 73 employees in the United States, mostly based in Tucson. 

 

 

EXPORT CHALLENGE

Exporting provides many challenges to small businesses who may not have the working capital to support sales. Cash flow, a crucial aspect for small businesses like CEI, are jeopardized when the company does not have sufficient funds to fulfill an export order. CEI could not find commercial lenders that were willing to include uninsured foreign accounts receivable in the company’s borrowing base to maximize its line of credit.

EXIM SOLUTION

In 2005, the company turned to EXIM’s working capital loan guarantee to include foreign accounts receivable as collateral in its borrowing base.  EXIM’s lender loan guarantees enable U.S. exporters, mainly small and medium-sized businesses, to obtain working capital loans from qualified commercial lenders,

CEI has a 12-month $3.2 million working capital revolver loan through GBC International Bank in City of Industry, California, to support exports projected at $6.5 million. EXIM guarantees GBC's loan that covers CEI's inventory and purchases of materials. The revolveing line of credit also helps to maintain cash flow while the company is awaiting payments from its buyers. 

RESULTS

The funds have enabled CEI to sustain exports to major buyers in  the Philippines, Mexico, and the Netherlands. The loan supports 42 existing jobs and the creation of 2 new jobs Over the past five years, EXIM has helped to support more than $61 million of CEI’s exports. Exports now account for 40 percent of the company's total sales.

“Exports constitute a significant portion of our business, and we need our foreign accounts receivable to be included as collateral. EXIM’s program has given us access to the working capital we need to sustain our exports and the jobs of our hard-working employees.”
Don Martin, President