Purchase Order Financing
Obtain Business Capital by Monetizing Pending Orders
Purchase Order Financing Defined
Purchase order financing is designed to help businesses fulfill large customer orders when faced with cash constraints. In this process, a lender provides funding to procure or manufacture goods based on confirmed purchase orders from a customer.
This type of financing is risky, since the lender, with limited operational or product knowledge, has to insert himself between the company and a manufacturer. After the finished goods are shipped to the customer, the lender uses invoices for products sold as collateral to collect the debt outstanding.
Benefits of Purchase Order Financing
Purchase Order Financing allows the business to cover the costs of manufacturing or purchasing of the goods necessary to fulfill a pending order. It helps a smaller enterprise fill large orders from new customers.
How Purchase Order Financing Can Work for Your Business
This type of financing is particularly valuable for companies experiencing rapid growth, seasonal fluctuations. It provides a practical solution to bridge the gap between cash required by the manufacturer and cash in the bank to secure a lucrative order, enabling businesses to capitalize on opportunities and fulfill customer demand.
Here’s where we can help:
Purchase Order Financing, while very useful to the right business, can be a complicated process to secure. With a significant financial outlay to go through the legal documents necessary to secure the loan, doing it incorrectly can be costly.
Your Deal Source has the partners and experience to navigate this process and help ensure a successful lending deal.
How do we get started?
Contact a YDS expert for a short no obligation free consultation call.
YDS will help you think through your options and introduce you to the best lending options for your company’s needs.
YDS can help you find Subject Matter Experts to help prepare you for the capital infusion, as well as improve your appeal to potential lenders.
YDS is there to support you through the application as you deal directly with lenders to apply and secure financing.