Monday, July 17, 2006

When Supplier Credit Runs Out – Purchase Order Financing Steps In

Have you been in this situation before? Your company is growing rapidly and your suppliers are unwilling to extend any further credit so that you continue to meet the requirements of your customer.

You might turn to your bank (if you have one), but they express concern over your length of time in business, your customer concentration or your high growth rate. Besides, lending in order to help you fulfill purchase orders is not necessarily included in their product offerings.

Purchase order financing is an option you might consider – with a firm order for a creditworthy customer, you can borrow enough money to cover your cost of goods sold. If your margins are at least 15-18%, this may be a quick solution to keep you on track to grow your company’s revenues!

Related Tags:

No comments: