Purchase Order Financing:

What is Purchase Order Financing?

Purchase order financing is an effective financial solution many companies rely on when it comes to financing large purchase orders. Also known as PO financing, it provides resellers and distributors with the much-needed financial resources so suppliers can be paid expenses associated with the order. It allows them to complete the order and book the revenue.

Who can be benefitted?

Purchase order financing works best for small companies that are growing rapidly and provides a multitude of great benefits. It is basically a loan that’s based on your orders. This type of financing proves beneficial for small businesses, as they often struggle to find the required funding for delivering on their orders. All those small businesses that are suffering from financial crisis look no further than purchase order financing when it comes to satisfying their customers.

Invoice Factoring & PO Funding - Step 1 of 6
(as shown on the Articles of Incorporation or Partnership Agreement)
  • You receive an order
  • You provide the supplier with order details
  • The lending company pays the supplier
  • The supplier completes the order
  • You send an invoice to the customer for the goods
  • The customer pays the invoice

A producer, reseller, wholesaler, or distributor of products needs to have a good relation with customers. Because they work directly with customers every day, it’s crucial for them to be honest and fair. Purchase order financing is the most ideal and practical solution for these businesses.

If you’re having a hard time purchasing the supplies or are facing a cash flow problem, purchase order financing is your best bet. There are several benefits of PO financing. These include:

  1. Easier to get
  2. More flexible than a business loan
  3. No personal guarantee
  4. Best for start-ups
  5. Larger profits
  6. Timely delivery for customers
  7. Increased market shares
  • Sell finished goods
  • Sell to B2B customers
  • The order should be of at least $20,000
  • Sell to customers with good credit

Purchase order financing is unique in several ways. This type of financing is easy to qualify for if you have suppliers and customers of good reputation. No matter you’re working as a producer, seller, wholesaler, or distributor, allow Biz Loan Bankers – a top Loan Facilitating Company – to help you with purchase order (PO) financing.