Getting Started with Purchase Order Financing
If a lack of cash is stopping you from accepting new business, purchase order financing may be the ideal solution.
Without proper cash flow, your company may be unable to purchase the materials and supplies you need to complete a contract. Purchase order financing allows you to access immediate cash based on your orders so you can finish the job without waiting to get paid.
Does Your Business Qualify for Purchase Order Financing?
Due to the nature of purchase order financing, there are certain guidelines that companies should meet to be eligible:
- Provide qualified purchase orders that are not pledged to any other entity
- Minimum gross profit must be no less than 20 percent
- The initial transaction must be at least $100,000
You can qualify for purchase order factoring in as little as 3 to 5 business days with the appropriate paperwork; once you are approved, you can begin financing your purchase orders immediately!
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How PO Financing Works
The process of financing purchase orders is nearly identical to standard invoice factoring. Submit your written purchase orders to the factoring company, which will advance you up to the full value of the PO within 24 hours. Use the money you receive to fund the work you do and to accept new contracts for a small factoring fee. When the order is filled and payment received, the factor will send you any remaining money owed.
We work with a nationwide network of factoring companies that specialize in purchase order financing. PO financing companies can fund the following types of work, and more:
- Capital equipment
- Finished goods
- Shipping
- Raw materials
- Letters of credit
Regardless of your industry, our partners can tailor a purchase order factoring program to your specific needs and turn your purchase orders into cash.
Benefits of Financing Purchase Orders
Flexible contract terms, back office support for collections and credit verification, access to online reporting and fast transfers are just some of the many reasons that companies choose accounts receivable factoring for their purchase order financing needs.
Most importantly, you don’t have to pick and choose where to invest in your business or struggle to keep up with continued growth – instead, you can use your revitalized cash flow to support every area of your company and stay ahead of new business opportunities!
Don’t let your orders languish while you fight to build working capital. Choose purchase order financing and put your money to its best use. Call us today to receive a competitive proposal and get started!
