Purchase Order Financing: Can It Help Fulfill Your Orders?

If you need to fulfill your customers' orders but lack the cash flow to do so, look into purchase order financing soon. Purchase order financing is a service offered to small business owners who temporarily can't pay their suppliers for the services or products their customers need right away. The service allows you to fulfill your customers' orders and keep your business going. Learn more about purchase order financing and how you can apply for it below.

What's Purchase Order Financing?

If you're like other businesses today, you may experience an increase in customer orders during the holidays and other special times of the year. You want to fill your customers' orders as soon as they come in. However, cash flow problems can prevent you from fulfilling your orders on time. Not only do you risk losing your customer's business, but you also risk losing your company. Purchase order financing can help you avoid both issues this year.

Purchase order financing is a unique third-party loan service offered to small businesses around the United States. The service allows you to pay your suppliers before your customers receive their products or services from you. Once the suppliers receive payment from a third-party loan service provider, they'll deliver the materials you need to complete your customers' orders. You can now fulfill your customers' orders on time and receive a profit after they receive them.

You may or may not receive full financing from a purchase order financer. The amount of financing you receive may depend on your creditworthiness, your suppliers' creditworthiness, and your company's revenue. 

If you think purchase order financing is right for you, apply for services today. 

How Do You Apply for Financing?

In order to qualify for complete or partial purchase order financing, you must complete an application online through a loan servicer or financial institution. The application requires you to do several things, including submitting information about your business, products, and services. If possible, obtain a copy of your business license or credentials before you request an application. 

You also want to submit estimates of the costs associated with your orders. Along with your creditworthiness, the estimates may help determine how much financing you receive to pay your suppliers and fulfill your orders. If you aren't sure about the estimates or how much you need to pay your suppliers, reach out to a loan servicer right away. Some loan servicers use calculators to estimate the cost of their clients' loans.

If you receive financing from a servicer, they'll complete all of the transactions between your suppliers and customers on your behalf. A servicer will send the rest of the funds to you after they deduct their fees from it. 

You can learn about purchase order financing by contacting a loan servicer today.