Ropa Siete Leguas has been granted a US$15mn revolving factoring facility by commercial finance company Capital Business Credit (CBC).
The facility is lent against accounts receivable as a standard factoring facility but can also be used for capital as well as providing credit protection.
The Mexico-based jeans manufacturer was previously self-financed, CBC outlines, but wanted access to more capital to fuel its growth and help it make modifications to its business to address the changing retail climate.
“Ropa Siete Leguas is one of the leading manufacturers in Mexico with an established history of success, making it an ideal candidate to work with,” a spokesperson tells GTR.
Revolving factoring facilities have increased in popularity, he adds, as banking facilities have become more difficult to obtain, which has led to more companies seeking out asset-based lending facilities such as factoring.
“Mexico is currently a good economy to be doing business in. As China production costs have increased (including labour costs), Mexico has become more competitive in pricing, the spokesperson adds.
In addition to more competitive pricing Mexico’s proximity to both US and South American markets is an important advantage with regards to production times and delivery costs.