Freeze out high prices and free-up cash
Choice Canning Company is a division of Choice Trading Corporation based in India. Launched 75 years ago as a shrimp canner, the company has expanded its geographic reach and product line, including food processing and packaging.
The company used a fleet of four refrigerated trailers, under short-term rental agreements, to move goods between the production line and cold storage. Meanwhile, Choice Canning was also paying a third party to provide refrigerated transport to and from an international shipping port. Short-term rental costs were high and required third-party transport fees locked up cash.
Choice Canning recognized the benefits of diversification in its sources of financing. “It’s always good to have multiple financing relationships,” says Alok Modani, CFO, Choice Canning. “For every transaction, I like to work with financial services companies that focus on the specific niche of funding we need.
The capital lease structure allows Choice Canning to transport to and from the port themselves lessening the need for third party freight.
- $3,000 per month savings through the long-term lease
- $25,000 per month savings in freight costs
- $330,000 in annual savings
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