Harbor Industries Finds Safe Haven with C2FO

The Grand Haven, Michigan-based maker of high-end retail displays faced a daunting market during the pandemic. Early payment through C2FO helped provide a lifeline.

As a young business analyst focused on strategy and acquisitions, John Gallagher learned a simple but valuable lesson about financial acumen: “Cash in must exceed cash out.” 

It’s a mantra Gallagher took to heart, one that guides him daily as the 30-year-old CFO of Harbor Industries, a $70 million company in Grand Haven, Michigan that custom builds high-end displays for retail brands like Walmart, Ulta, Nordstrom, GE, Kroger and many more. 

As the company has grown and expanded its offerings to include high-tech displays for everything from cigarettes to cell phones, Gallagher pays close attention to the cash flow — is there more coming in than going out? 

In 2020, as COVID-19 shut down the entire country, Harbor had to adapt. The company managed to stay open because it had shifted to manufacturing essential hand sanitizer kiosks. Still, customers were pulling back on orders and terms were extended. Fortunately, Gallagher had a tool he could use to improve cash flow and keep the company moving in the right direction, one he had recently begun using after years of skepticism. 

“C2FO in 2020 was crucial for me because I knew exactly where we were going to be cash-wise,” he said. 

From manufacturer to strategic partner

Striding through the office and warehouses of Harbor’s Grand Haven headquarters, Gallagher points out an array of carefully crafted — and technologically sophisticated — retail displays the company is developing. There’s a kitchen appliance kiosk with a touch screen and a camera that detects customers’ age ranges and moods. There’s a floor-to-ceiling convenience store display where different sections light up when a customer points at them. 

“We try to build technology in all our displays that we can,” Gallagher said. “We want something to be unexpected to our clients’ customers so that it grabs their attention and makes them want to buy.” 

Founded in 1926 as a business specializing in greeting card displays, Harbor has evolved into a company employing more than 200 people that serves a wide range of major retail brands, as well as grocery and convenience store chains. Harbor has expanded from wood fabrication displays to metals, plastics and, now, interactive, data-rich technology. The vision, Gallagher said, is to be a strategic, creative partner for clients in addition to being a maker of displays and fixtures.  

“We have the fulfillment just like everyone else does, but we also have the design in-house. We have the marketing in-house. We have the strategy and research,” he said. “We tell our customers what their customers are thinking and what will help them sell better. We have the installation in-house and that whole start-to-finish is what sets us apart.”

Cash in and cash out

For Harbor to continue innovating and expanding, however, cash in must exceed cash out. Gallagher first began receiving emails from a customer about C2FO’s early payment platform in 2016, but he didn’t consider using it until late 2019, as the pandemic began in China and Harbor first experienced supply chain issues. 

Around that time, Gallagher selected a few invoices for early payment and was impressed by the C2FO platform’s ease of use and timely payments. When 2020 began and the pandemic started to affect cash flow, he was ready to “Go all in” with C2FO.

Today, the economy has recovered, but issues remain with inflation, shortages and the labor force. Gallagher said he uses C2FO every day he has a clearing. He no longer is concerned if customers that offer early payment through C2FO have 90- or 120-day payment terms because he knows he can get paid when he wants. Having the ability to determine rates on invoices he chooses to accelerate makes the cost of early payment competitive with bank rates, “so it’s a no-brainer.”

Because cash flow at Harbor is Gallagher’s responsibility and no one else’s, it is always the first thing on his mind when he arrives at work and logs into his computer.

“When I open my browser, I have three tabs that open up: my email, my bank and C2FO,” he said. 

Accelerated cash flow through C2FO provides Harbor with more flexibility, whether that means expanding into new technology, relying less on its line of credit, or working with customers that don’t offer early payment.

“Without cash flow, you can’t keep your doors open, you can’t pay payroll,” he said. “We have projects where customers want us to put all our money down up-front, and then we can’t start shipping or invoicing for six, seven, or eight months. Well, we know we can’t do that, but we can with C2FO.”