Purchase Order Finance for Maximum Flexibility

Purchase Order Financing ($500,000-$5 million)

Whether you have a large order to be produced in the U.S. or overseas, as long as the goods are pre-sold and the purchase order is non-cancellable, Neebo Capital can finance up to 100% of your cost. 

One of the realities that businesses normally face is the fact that cash runs out. For a business to operate properly, you need sufficient working capital that can cover all your operational expenses. But in a world of seasonal sales and unpredictable revenue, there are times when you really run out of funding. The sales will come much later, and you will need various sources of funding to support your operations in the mean time.

An example of this is when you have a larger than normal purchase order from a particular client, and you lack the cash flow to complete this order. Whether this is to buy raw materials, cover the manufacturing costs, or pay for the delivery, you will need to be very liquid. This is where purchase order finance comes in.

Who Benefits From Purchase Order Financing?

Purchase order financing enables all kinds of companies from various industries to have a bigger working capital, when needed. Those who will benefit from this type of arrangement consist mostly of product importers, exporters, resellers, distributors, wholesalers, manufacturers, jobbers, and other such companies that are required to deliver large purchase orders to clients. Sometimes, there are also seasonal changes in sales that make certain times of the year extra tight on the cash flow. For growing businesses that have little access to working capital and who need to focus this capital on other priorities like marketing or research and development, purchase order finance brings maximum flexibility.

The Advantage of Applying for Purchase Order Financing

Getting additional working capital is not all there is to purchase order financing. After all, when you need additional cash flow, there are many other options you can run to. But compared to other options like a bank line or a loan, purchase order financing gives you maximum flexibility.

Here are some of the advantages of turning to this financing method:

  • It’s a financial solution that increases your cash flow depending on how much you need, whether that’s $50,000 or even as high as $20,000,000.

  • At your convenience and when you need it the most, it removes the strain from your current working capital and frees it up for other more important priorities.

  • Whether your purchase order is domestic or international, you can get financing for 100% of what needs to be paid for, without having to wire money internationally or sell equity as a last resort.

  • You don’t have to get stressed about what collateral to offer banks, or adding more debt to your portfolio.

  • Your credit line will be granted based on the financial strength and credibility of the customers you are serving. This is different from loans and other financing methods wherein you constantly need to prove your credit worthiness.

 

Clearly, purchase order finance is a solution that’s out there for those who need their cash flow and working capital to be stretched, and it’s a solution that’s available for you when you need it.

 

 

Published by

Chris Lanchech

Hi everyone, my name is Chris and I am a junior analyst at Neebo Capital and an inspiring blogger. We enjoy speaking with business owners and entrepreneurs who come to Neebo Capital looking for cash flow solutions. Give us a call toll free at 1-888-382-3766 or Visit us online at www.neebocapital.com

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