It has been pointed out for a long time that one of the structural problems of the lumber industry was a shortage of funds. There seem to be many firms that have abundant inventories of lumber but have a limitation in the amount of lumber that they can process and the amount that they can ship due to cash flow constraints.
To deal with this problem, a project team, consisting of a regional financial institution, a furniture manufacturing firm, and a university’s laboratory, came up with an idea to use ABL for establishing a new business.