Mike Semanco, President of Hennessey Capital LLC, a Michigan-based specialty finance company providing working capital to small and mid-sized businesses, doesn’t deny that 2009 was an exceedingly challenging year for businesses of all sizes.

However, he does say that 2009 may prove to be a watershed year for the commercial finance industry.
“The economic crisis and simultaneous traditional credit drought created an opportunity for the commercial finance industry to step up to the plate and be recognized,” affirms Semanco. “The ability of many commercial finance companies to say yes to lending when many banks were saying no, often meant the difference between a business maintaining its position in the marketplace or closing its doors.”

Hennessey Capital President Mike Semanco offers the following 5 Reasons why 2009 was a good year for the Commercial Finance Industry:

1. The industry reminded the business community why factoring and asset-based lending have a 500 year history as it stepped up to finance small to medium sized businesses when traditional lending was either tight or non-existent.

2. Asset-based lending and factoring garnered increased media attention this year, helping to educate business owners on the availability and value of such lending vehicles.

3. The industry gained a new level of respect because of the expanded role it played in commercial lending and was able to significantly reduce the stigma associated with the use of factoring and asset-based lending, further burying the “lender of last resort” moniker.

4. The industry benefitted from the fallout in the broader financial services industry, presenting the opportunity to tap into some outstanding talent to further grow companies within the commercial finance field.

5. With more business owners taking advantage of the benefits of factoring and asset-based lending, users of commercial finance are now more likely to share first-hand experience on how commercial financing vehicles helped sustain or grow their business

There was a broader lesson to be learned in 2009 as well, notes Semanco.

“Borrowers and lenders alike found a new level of discipline required to make reasonable credit and cash flow decisions,” acknowledges Semanco.

Source : CFA (Commercial Finance Association USA) e-newsletter 7. Jauary 2010