Purchase Order Financing

Purchase Order Financing is used to pay your suppliers, laborers, or other intermediaries for goods to generate additional sales.

Every purchase order transaction stands on its own. We look at your business history, the credit worthiness of your customer, the ability of your supplier to produce the goods, and if the transaction is profitable for all parties. A company will need purchase order financing when they:

Our ideal PO Financing transaction is for wholesale distributors - no service providers. We do not finance PO's for services. We finance PO's for goods that are being resold only, or for goods that have only minimal value-added work done prior to resale. And there needs to be significant magin in the product at resale - usually a minimum of 15%+ margin. Faster converting PO's are best and are the least expensive.

For Invoice Factoring click here

Business History
We consider funding those organizations with a track record of reselling goods. Your company may be young or a startup, but your company management must have a proven track record to produce the goods.

Buyers Purchase Order
Your buying firm must be reputable with a good credit line. The purchase order must be verifiable.

Supplier
Your suppliers must know your product and be able to produce it in time and to meet your buyer's terms. The supplier must be a firm with a good business history and track record of producing goods.

Profitability
The transaction after all expenses must make a profit for all parties. Payment of the money lent to support the transaction can come from any number of sources such as factored receivables.

Purchase Order Financing is available only to qualified customers. PO Financing falls into two types:

• Finished Goods refers to transactions where the goods are never touched by you. Usually these goods go directly from your supplier to your buyer. You never take direct possession.

• Non-Finished Goods are when you the seller take possession of the goods either in a raw state (such as yarn to make blue jeans) or a semi finished state (partially sewn blue jeans). In either case you must take possession of the product.

Finished Goods are easier to finance than Non-Finished Goods. We will need to assess your
ability to complete the transaction in processing the goods for the final shipment to your buyer. We
finance both Finished and Non-Finished purchase order financing.

In order to consider PO Financing for your firm we will need:

Generally we charge 3-7% (sometimes more, sometimes less) one time fee for purchase order financing on the gross amount to be paid by the buyer. Sometimes there may be an additional interest charge on the money advanced if the purchase order takes greater than 30 days to complete. Every purchase order pricing is individual and unique. This purchase order fee does not include the factoring fee which may cost an additional 3% to 6% if you are factoring the receivable. We will consider financing a purchase order transaction to be paid out by another factor or lender. In
order to see if the transaction will make money for both parties, please fill out the worksheet section of the application form. As you can see the total cost of purchase order financing fee and factoring fee can range from 5 to 12%. Since both of us need to make money, the gross margin should be greater than 18%.

Types of unusual purchase order funding that can be done include:

Call us today at 623.536.0896 to see if you qualify for PO Financing.

If you know a company or individual holding notes or any other income stream, but would prefer a lump sum of cash, click here. If we purchase their note, WE'LL PAY YOU a finder's fee!