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FXR Factory Racing rev's up with funding from First West Capital

FXR Factory Racing Inc.

FXR Factory Racing Inc. (FXR) has been designing and manufacturing performance apparel for action sports for over 20 years. Based in Oak Bluff, Manitoba, FXR has experienced considerable growth in recent years as it continues to diversify into new markets by offering new product lines, including an accessory line, outdoor line and a very popular camouflage line.

The rapid pace of FXR’s growth, compounded by the pronounced seasonality of the business, has resulted in an intense need for working capital support, particularly at certain times of year. First West Capital’s funding makes it possible for FXR to reliably deliver more product to more places, more quickly.

Subordinated debt addresses a capital challenge

Funding provided by First West Capital allowed FXR to effect significant and time-sensitive final payments to key suppliers, which in turn made it possible to ship winter inventory to retailers around the globe.

“When you look at the lost sales that would have resulted from the product being late, and the additional costs that would have to be incurred in order to get it to market on time, getting this kind of capital in place when we needed it makes absolute sense,” states Milt Reimer, CEO / Owner FXR Factory Racing. “The high degree of collaboration between First West Capital, FXR’s management team and the company’s bank made the due diligence and funding process seamless. By providing the required level of subordinated debt, FXR now has access to sufficient liquidity – in the busy winter months as well as during the summer when the company designs, orders and manufactures its inventory – to continue its rapid growth,” states David Hastie, Managing Director of First West Capital.

Working with First West Capital provided Reimer with the comfort and assurance needed to seal the deal. “I was very impressed with their knowledge. Their commitment to and understanding of the business provided me with the confidence and security that the deal would come through and work for us,” shared Reimer.

Uncovering opportunities

Moving forward, the partnership between FXR and First West Capital creates long-term value. The total financing structure, which in addition to First West Capital’s facility includes an asset-based line of credit from the company’s house bank, requires FXR to implement internal systems and processes that will assist the company to plan and monitor the next wave of expansion.

“The company has been running us, with the new sub-debt and ABL structures in place, we can take back ownership of the process in order to improve efficiencies and the overall operation of the company,” states Reimer.

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