21.03.2016

Armadillo shines a powerful light in the marketplace

A client of Trade & Export Finance for almost two years, Armadillo LED has developed a relationship with TAEFL and its associated finance specialist UK EXIM that has helped the business realise sales opportunities that it would have been difficult to exploit.

Based in Essex, in the market town of Great Dunmow, Armadillo LED is part of Armadillo Marketing, which traces its history back 20 years to the earliest days of using light-emitting diode devices in mainstream commercial applications.

Supplying specialist lighting solutions which include the devices, the associated electronics and control software, the company has recently secured contracts to provide LED lighting for three of London’s bridges, having completed the upgrade to the Millennium Bridge. It is also involved in the software management of lighting on Tower Bridge.

The team behind Armadillo realised the potential in a game-changing technology which has revolutionised the use of light sources across a spectrum of applications, Motor car headlights were among the first non-specialised applications, but clusters of these ‘cold’ lights have been taken up for lighting public spaces such as roads and car parks. Key drivers for their adoption are lower maintenance costs and lower power consumption (75% reduction with the option to cut consumption further ‘in real time’ where safety is not an issue).

Diodes in at the birth of communications

The electronic diode has been at the heart of communications since the start of the 20th century where it was used in the earliest radio systems. It took fifty years to miniaturise the effect on to a small ‘chip’ of semiconducting material subjected to a correspondingly small source of electricity. Generations of systems were spawned where ever-increasing numbers of these one-off switches were creating on to a single piece of semiconductor.

But it was a property of certain semiconductor materials which opened up new horizons. It was realised that, when subjected to electrical ‘pressure’, these diodes emit light of a constant wavelength, were efficient in that they consumed minimal amounts of electricity for a given output of light energy, and did not get hot in the process.

Progressive improvements in the design and electrical characteristics of these LEDs mean that they can challenge conventional light bulbs. Used in offices, for example, they are a flicker-free alternative to fluorescent lighting. LEDs are here to stay as a technology that has an impact on everyday life.

Funding orders to completion

Armadillo LED is clearly at the forefront of the design and implementation of LED lighting solutions. Like many businesses which are successful in what they do at a technical level, the company encountered problems when it could not readily finance some of the larger or more adventurous applications. It had been awarded a contract by a prominent US highways authority to install LED replacements for conventional lighting. It needed additional funding to help finance the sales cycle.

The introduction to TAEFL was made by a peer-to-peer sponsor who knew Trade & Export’s approach was more in line with the company’s requirements than its own model. Working closely with UK EXIM, its associated finance company, TAEFL created a solution for funding Armadillo’s export sale to the US. UK EXIM sourced the LED elements from a multitude of suppliers of against a Letter of Credit. After the goods were checked on arrival in the UK in a bonded warehouse by Armadillo, they were batched with the British-made mountings and forwarded to the US for installation.

Armadillo LED used a local invoice discounting business in the US to generate cash quickly from its sale to its highways authority customer: Armadillo secured its payments against a Letter of Credit on UK EXIM. As a result, there is end-to-end financing of the deal. Additional facilities provided through UK EXIM enabled the LED vendor to finance a number of smaller deals, subject to credit insurance on the purchasers.

According to David Bide, CEO of Armadillo LED, the relationship with TAEFL has served the company well. “The team at Trade & Export are always very supportive and flexible whether things are going well or not quite to plan.  They are keen to understand our requirements, not just look at numbers on a balance sheet.”.

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