Pacific Building Center is a family owned and operated business that has served the community of Blaine, Washington since 1997. The company has successfully provided building materials to contractors for nearly two decades, but found that inconsistent cash flow from their credit program was hampering business growth. To help solve this problem, Pacific Building Center decided to overhaul their credit services with help from BlueTarp.
Tired of being the bank
The demands of providing credit to professional customers were a troublesome aspect of business for Pacific Building Center. “We had $100,000 in receivables – half of it past due. We didn’t want to borrow money or use our line of credit to pay the bills and we finally decided we just couldn’t be the bank anymore,” says Kimberly Akre, owner and daughter of founder Bob Christianson, a long-time WMBA member.
When Pacific Building Center brought in BlueTarp, they had three key goals in mind. First, they wanted to build their pro customer base and increase their volume of professional sales. Second, they wanted to improve cash flow. Third, and most importantly, they wanted to do this without the risk, uncertainty and hassle of managing an in-house credit program.
Turning on the cash flow
After less than six months on the BlueTarp program, Kimberly saw how BlueTarp can “turn on” their cash flow and the difference it makes for the business. “The best thing about BlueTarp is I know what’s going to come in and when, and I can plan for our payments,” she says. “I love the fact that on the 10th of every month I can look at my bank account and I’ve got a huge deposit from BlueTarp. It’s so much easier now to manage our finances and our line of credit.”
Pacific Building Center also has a new perspective on the impact that customer credit limits have on cash flow. Before BlueTarp, if a contractor came in wanting to spend $10,000 on materials, Kimberly notes that her initial thought was “that’s $10,000 we’ll have to cover.” With BlueTarp determining customers’ lines and assuming the credit risk, she no longer worries about covering the gap between ordering materials and getting paid for big jobs.
Kimberly also appreciates BlueTarp’s online tools that let her keep tabs on every aspect of her credit program beyond just tracking her monthly BlueTarp payment. As existing customers have joined the program, she’s been able to monitor credit limits, payments and other activity. Her pro customers are also starting to take advantage of BlueTarp’s online tools, such as paying bills, creating their own invoices and managing their accounts 24/7.
Building a competitive advantage
With its BlueTarp credit program established, Pacific Building Company is planning for future growth. Residential and commercial construction is picking up locally, and Kimberly notes that they are in a great position to proactively secure new business. The combination of predictable cash flow and reduced risk means the company can focus on pro sales and hiring staff focused exclusively on serving commercial and residential builders.
Kimberly sees a competitive advantage with the ability to offer larger credit lines and longer terms to secure larger jobs. This will be especially important as they seek to expand the number of commercial builders in their customer base.
“BlueTarp has made a huge difference by having our receivables collected and available to us on a predictable schedule,” says Kimberly. “It has also simplified an area of the business that had gotten complicated and was holding us back. With credit risk off our backs and a more competitive offering, we can focus on growing the business.”