Manufacturing:

Flow Water Incorporated

Deal Size:

$3,310,300

Equipment:

Bottling Equipment

Industry:

Food and Beverage

“NFS followed a simple process. The communication was fast and realistic. Overall, I would give NFS an A+,” said Hoar. Keeping communication straightforward and fast allowed Flow to fill its facilities with the necessary equipment and start production sooner.

SUMMARY
Early stage companies often face cash restraints that inhibit their ability to fuel growth. Entering the $15 billion U.S. water industry does not make things any easier. This is the story of how Flow Water worked with NFS Leasing to overcome those cash restraints, to expand production and enter new regional markets.

  • Adding facility and manufacturing equipment expenses to wages, marketing, insurance, and all other business expenses caused Flow Water to seek alternative financing
  • Completing an equipment lease enabled Flow to begin self-manufacture earlier than expected and increase operating margins to help the company grow and shift focus to other business units

CLIENT UPDATE: Completing multiple transactions, NFS Leasing, Inc. has provided Flow Alkaline Spring Water with over $6,500,000 needed for Manufacturing Equipment.

THE CLIENT
Flow Water was founded in late 2014 on the principles of being the worlds first socially responsible water company. As an early stage Canadian company looking to enter the U.S. bottled water industry, it positioned itself as a premium water company with a focus on providing customers the most naturally alkaline spring water in the most eco-friendly package possible.

The 100% recyclable, carton-based Tetra-Pak packaging allows Flow to reduce its carbon footprint and conserve the environment. It is currently the only premium water to use alternative packaging. The combination of naturally alkaline premium water and package integrity is the key factor that separates Flow from the competition.

THE CHALLENGE
Flow had begun an expansion into the U.S. and was looking to build out multiple facilities. Although, Flow was receiving incredible support from its shareholders, it still lacked the cash flow needed to support its aspirations of vertical integration and production at scale to improve margins. Being a young company, obtaining financing through traditional methods proved difficult.

The banks were skeptical of Flow, having trouble seeing beyond its balance sheets which caused the banks to ask Flow to take risks and agree to conditions that it was not willing to. The finance agreement proved to be too challenging to complete. Flow soon realized that traditional bank financing was not the right option and instead the management team decided that it would need to seek alternative financing.

THE SOLUTION
Flow turned its focus to finding an independent financer. In this search, NFS Leasing rose to the top. After the initial conversation between the two companies and representatives, Flow realized it had just found itself a true financial partner and not just a money source.

Matthew Hoar, CFO of Flow Water said, “Working through the initial challenges with NFS was excellent. The level of responsiveness was fantastic, and they have an extremely high level of service. It was a great process.”

EXECUTION
Working through the deal to get it executed was very easy as well, as many of the characteristics from the introduction carried over. Getting the deal executed would allow Flow the opportunity to get its facilities up and running with less downtime and achieve higher production and improved margin.

“NFS followed a simple process. The communication was fast and realistic. Overall, I would give NFS an A+,” said Hoar. Keeping communication straightforward and fast allowed Flow to fill its facilities with the necessary equipment and start production sooner.

RESULTS
Completing the agreement with NFS has allowed Flow to build out two production facilities, on in Canada and one in the US, in an effective and efficient manner. The first facility in Canada was up and running with the necessary equipment one year ahead of plan. The production capacity of Flow’s facilities is excellent and exactly what it had hoped for. With NFS’s simple process and high level of service, Flow will look to generate $75-$100 million in revenue in the next twelve months.

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