The most common dilemma of new and growing resellers and wholesalers is the requirement of suppliers to pay for the goods up front. But, their own clients only pay a fraction of the costs, leaving them to carry the costs of the entire production. However, there are only few companies that have the capacity to shoulder the costs while waiting for the payment of their own clients.
Bank financing isn’t a good option since most banks don’t usually lend to start ups. If they do, the process is long and complicated. And they will require that the business owner present 3 years’ worth of audited financial statements showing a profit before making a loan.
So, if your business doesn’t qualify for bank financing, then one alternative called purchase order financing can greatly help. As opposed to traditional bank finance, po finance is easy to qualify for and can be set up quickly. The main requirement is that you have an order from a credit worthy commercial or government client. This alternative is available to start ups and growing companies and will cover up to 100% of all supplier expenses. With po financing, companies can secure the inventory they need to fulfill pending orders.
