Green Zone Capital Advisors

Weekly frontline intel on capital markets, funding, and strategy — no fluff, no spin.

Asset-Based Lending in a High-Tariff World: What CFOs Need to Know Now

Business Financing Strategies| Credit & Risk Management| Industry Insights| Private Equity

May 13, 2025•2 min read

In a normal market, asset-based lending (ABL) is one of the most flexible forms of working capital financing.

But we’re not in a normal market anymore.

With tariffs driving up costs and slowing cash flow cycles, lenders are quietly adjusting how they view—and value—your receivables and inventory.

If you haven’t recalibrated your ABL strategy, your available liquidity could shrink when you least expect it.

Here’s what every CFO and business owner needs to know now.

What Tariffs Are Doing to Asset-Based Lending

Tariffs are inflating input costs and extending working capital cycles.

That’s forcing lenders to tighten the rules:

More conservative advance rates on inventory (especially imported goods)
Lower appraised values on AR over 60 days old
Increased focus on customer creditworthiness, not just your own
Stricter field audits and reporting demands

Bottom line:
Even if your company is performing well, your borrowing base may not be.

Why the Advance Rate You Were Quoted Six Months Ago May Not Hold

Many companies are still operating under outdated assumptions about their borrowing power.

In a high-tariff, sticky inflation environment:

Inventory may be valued at replacement cost, not sales value.
Receivables are discounted faster if customer payment patterns slow even slightly.
Lenders are adjusting eligibility criteria quietly and tightening compliance exams.

If you haven’t stress-tested your ABL facility in the last 90 days, you’re exposed.

Smart Companies Are Stress Testing Their Borrowing Base Right Now

The CFOs staying ahead of the curve are already:

Running borrowing base projections under higher margin compression scenarios
Reworking inventory strategies to maintain eligible collateral ratios
Preparing updated financials to respond quickly to field audit findings
Opening capital strategy conversations with advisors before the next renewal

ABL lenders aren’t waiting for a crisis. Neither should you.

How Green Zone Capital Advisors Helps CFOs Stay in Control

At Green Zone Capital Advisors, we specialize in keeping middle market companies two steps ahead of lender recalibrations.

Our capital strategy services for ABL borrowers include:

Proactive borrowing base health checks
Independent collateral reviews aligned with current lender standards
Renewal preparation with banker-ready financial packages
Strategic lender negotiations to optimize structure before covenant breaches

When liquidity is at risk, information and timing are everything.
And the companies that move early will have far more options than those forced to react later.

Don’t wait for your borrowing base to tighten

Request a confidential borrowing base readiness review
with Green Zone Capital Advisors today.

Stacey Huddleston

Stacey, founder of Green Zone Capital Advisors, a trusted capital advisory firm helping business owners, CFOs, and private equity partners access funding solutions through a broad network of lenders.