Harborpark Funding Group passes funding requests from Binghamton, New York machine shops and fabricators to funding partners. This page covers Broome County fabricated metal counts, CNC machines, inspection equipment and banks versus machinery lenders.
At a glance
- Fabricated metal manufacturers, Broome County, NY
29 fabricated metal product employers, including machine shops, Broome County, NY (CBP 2023)
- Fabricated metal employees, Broome County, NY
1,119 paid employees at Broome County, NY fabricated metal product employers (CBP 2023)
- Manufacturing employers, Broome County, NY
157 manufacturing employers with 7,014 paid employees, Broome County, NY (CBP 2023)
Machine Shop Financing for a Southern Tier Job Shop
A Southern Tier job shop works order to order: a customer sends a print and a purchase order, the shop buys material, programs the machines and ships the parts, then waits 30, 45 or 60 days to be paid. Machine shop financing has to fit that cycle, with equipment loans for the machines and a line of credit for material and payroll between shipment and payment.
Fabricated metal product manufacturers, the Census group that includes machine shops, numbered 29 employers in Broome County, NY in 2023, with 1,119 paid employees and about $63.5 million in annual payroll (CBP). These are larger operations than most: just 7 of the 29 had under five people on payroll.
Manufacturing as a whole had 157 employers and 7,014 paid employees in the county, and its payroll, about $497.8 million, was the second largest of any sector after health care.
CNC Machine Loan for a Swiss-Type Lathe
A Swiss-type lathe turns small, precise parts in long runs, and it is one of the larger investments a shop makes. A CNC machine loan for one is an equipment loan secured by the machine, often with the bar feeder and tooling included. A reviewer weighs what the lathe would resell for, how much work is booked and who the shop sells to.
Illustration only, invented figures: a $310,000 Swiss-type lathe with a bar feeder financed over 84 months at an invented annual rate of 8.75% costs about $4,948 a month (our arithmetic).
Rigging, installation, electrical work and programming time should be in the budget, and some lenders include them in the financed amount.
Metal Shop Loans for a Broome County, NY Fabricator
A Broome County, NY fabricator cutting, bending and welding sheet and plate runs press brakes, shears, laser or plasma tables and welders. Metal shop loans for those machines work like any equipment loan, and a used press brake or laser can be financed after an inspection.
Fabricators often carry steel and aluminum stock for repeat customers. That stock can go on a line of credit or an inventory loan rather than a long note.
Can You Finance a Metal Shop Expansion With Equipment as Collateral?
Yes, a metal shop expansion can often be financed with the equipment as collateral, but an expansion is more than machines. A new bay brings electrical upgrades, compressed air lines, foundations for heavy machines and the hiring of operators. Lenders finance the machines against their own value and look at the shop's cash flow for the rest.
Bring the expansion budget split into machines, building work and hiring, the backlog that justifies it and the shop's financial statements. Purchase orders or long-term agreements from customers carry weight.
Machinery Finance Companies Versus a Regional Bank
Machinery finance companies focus on equipment and know its resale market, so they may finance a used machine or a younger shop that a bank would not. A regional bank may offer a lower price and a broader relationship, including a line of credit, but it usually asks for more records and collateral.
Compare offers on total cost, the down payment, prepayment terms and whether the lender wants a lien on more than the machine. The term loan article covers balloon payments.
Inspection Equipment, Quality Records and the Machine Shop File
Coordinate measuring machines, optical comparators and surface plates support the quality systems customers require. They are financed like production equipment. Lenders reading a machine shop's file look at its customer list and concentration, its quality certifications and its on-time delivery record, alongside tax returns and bank statements.
A shop that sells most of its output to one customer should expect questions about that relationship and its contract terms.
Backlog, Customer Concentration and the Payment Cycle
Lenders reading a job shop's request start with the backlog: open purchase orders, their values and their ship dates. They then look at who the customers are and how much of the shop's revenue each one represents, because a shop that sells most of its output to a single buyer carries that buyer's risk. An accounts receivable aging shows how long customers actually take to pay.
Bring the backlog report, the aging, two or three years of tax returns and a list of machines already financed. A shop that tracks spindle hours on its current machines can show how full they are, which supports the case for adding another.
By Harborpark Funding Group · Updated