Get financing to buy supplies needed for new orders
Purchase order financing, or PO Funding, is a short-term commercial finance option that provides working capital to businesses so they can pay suppliers upfront for the goods they need to complete an order. By using a purchase order finance company, the business can pay suppliers directly usually via a letter of credit, without having to deplete its cash reserves. Once the order has been completed, the purchase order financing company is paid back.
What type of companies use purchase order financing?
Purchase order financing is used by many types of businesses, such as: manufacturers, distributors, wholesalers or resellers of manufactured products. Purchase order financing helps growing businesses that don’t have enough access to working capital and/or have poor cash flow.
If your business has a purchase order from a customer, but is short on working capital to purchase the supplies needed to fulfill it – you may want to consider purchase order financing. Purchase order financing is generally easier to qualify for compared to traditional bank financing. In addition it gives your business access to capital without having to give up any ownership of your business or take on unnecessary debt.
Who qualifies for purchase order financing?
Purchase order financing is available to large and small business. However, to qualify your business must sell tangible product(s) to other businesses that have a good track record of paying their bills. And usually your business needs a specific purchase order in hand.
