Importers are always on the lookout for ways to carve out a larger market share without having to take out bank loans or placing debt on the balance sheets to access growth capital. In order to achieve growth while preserving credit ratings, many importers are turning to purchase order financing.
Purchase Order Financing For Unexpected Orders
Every once in a while, importers receive unusually large orders, and cannot fill them without placing a severe strain on cash reserves. These situations used to mean taking out bank loans to get the working capital necessary to deliver unusual customer requests. However, purchase order financing is a great alternative, because it acts as an advance in working capital without making importers incur debt. Once the order is filled and the customer pays in full, the advance is deducted and the remainder is delivered to the importer as revenue.
Getting A Larger Market Share
Purchase order financing also levels the playing field, allowing new and smaller importers to compete with larger companies. By having the ability to shift the focus of the business to include larger orders, importers can grow their customer base without having to turn away large requests or refer them to competitors. Purchase order financing also allows importers to accrue growth capital quickly by taking on large customer requests. Since (ultimately) the customers pay for both the orders and the financing, importers have everything to gain.
No Debt Required
Purchase order financing is not a loan. There are no credit checks run on importers, and no debt placed on the balance sheets. This form of financing is an advance in working capital which is paid in full when the end customers remit payment on their invoices. Importers preserve their credit ratings, which leave options open to secure financing for other projects later on down the road.
Find Out More Today
If you would like to learn more details about purchase order financing, or if you would like to explore our many financing alternatives to traditional loans, call the Lavan Financial Group at 203-308-4547. We will work with you to understand our business goals, and provide the right solutions to fit your needs and budget. Contact us, and let us know how we can work for you.