“NFS was very flexible when working through the terms. They let us know what they were willing to do for us, how it needed to be done, and explained why it needed to get done. Having structured multiple deals with them, its safe to say I appreciate their partnership,” said Daniel Bunn, Owner of Mega Highwall Mining.
Being a new player in an established market is tough and when the cash flow is limited the obstacles to growth can be difficult to overcome. The story below describes how one company was able to overcome those challenges and find a solution to help to fuel its growth.
- Limited cash flow can be troublesome when a company is in need of expensive equipment to provide the right service for clients.
- In a volatile industry, obtaining financing requires flexibility and understanding from the financial partner, which will lead to increased revenue and impressive profit margins
Mega Highwall Mining LLC. (Mega) is a coal mining company founded in 2015. It operates both ADDCAR and Superior Highwall Mining Systems. It takes great pride in its machines, maintains industry leading availability and is dedicated to maintaining safety standards. Mega is experienced in operating in various adverse conditions including steeply dipping seams, augured works, extreme climate, and numerous others.
Mega operates its machines on land that has previously been used as a mining site. The company’s automation means not sending in miners underground to mine. Mega is making coal mining less dangerous for employees and the environment.
In order to grow its business, take on more projects and keep customer demand satisfied, Mega would need more highwall miners. However, new highwall mining equipment is massive and can cost upwards of $2 million, usually more. Such an expense would interfere with other business expansion priorities and cash flow in general.
A decision to rebuild miners rather than straight purchase of equipment would be more cost effective. Securing the necessary funding to rebuild miners was vital to maintain liquidity in the businesses.
Mega knew it needed a true financial partner. One that could understand that without the funding, it could face a financial issue of little-to-no liquidity in the business. And without the equipment, it would not be able to provide the high-quality service to its clients. NFS Leasing is the partner that it turned to, and together the companies worked to understand the unique situation and provide funding to rebuild the miners.
Mega had engaged with NFS through a broker. With its unique situation and need to rebuild the highwall miners, it was happy to have found a financial partner that would work with it through those issues.
Early in the process, Mega experienced some growing pains but was glad it had NFS Leasing as a partner to help work through those pains. “NFS was very flexible when working through the terms. They let us know what they were willing to do for us, how it needed to be done, and explained why it needed to get done. Having structured multiple deals with them, its safe to say I appreciate their partnership,” said Daniel Bunn, Owner of Mega Highwall Mining.
Having clear communication on the deal allowed Mega the opportunity to complete its funding while focusing on what would come next.
Mega was pleased with the venture with NFS Leasing and secured the funding quickly. It looks forward to having all five of its highwall miners up and running at multiple sites, assisting its clients, while also seeing the return on its investment and putting cash back into its business.
In fact, Mega has more plans to grow its business and has returned to NFS Leasing as its partner to structure an additional deal.
It can be difficult for a company to grow on its own, but with the right partners backing it, it can grow and exceed even its own expectations.