Trade, procurement and inventory financing
Even seasoned veterans of purchase order financing can still be surprised by the misconception by some lenders and factors as to what purchase order financing is. Properly characterised as “structured inventory financing”, this insight will discuss how entrepreneurial lenders can lift the veil on the misconceptions of when to lean on a purchase order financing specialist. When […]
When a company wants to buy goods from a supplier, they need to find creative ways to pay for them if the cash is not immediately available. They can either apply for open credit terms (less common) or go searching for the working capital from equity partners, private investment firms, supply chain finance providers, banks […]
Import businesses are often profitable due to the lower cost of manufacturing goods from countries such as Korea, China, and Mexico. Getting the goods landed in Australia, marked up and sold for a profit can create particular cash flow challenges. If done correctly, importers stand to profit from lower cost to sale margins as long […]
An entrepreneur’s worst-case scenario: You land a significant sales order from a corporation or government agency, but don’t have the capital to pay the supplier/s. If you can’t find some money — fast — your business faces the potential loss of the order and likely the customer relationship. Entrepreneurs in this situation are gravitating towards […]
The term purchase order finance is well known to many people, but many still do not understand the depth and value of PO finance solutions. Even though purchase order finance has evolved a lot in the past few decades, many traditional lenders and financiers still view it through the lens of the past. PO finance […]
At a glance: It’s a line of credit to purchase inventory, finance freight and duty charges to free up working capital for day-to-day operations. It is estimated that over 60 percent of clients have had products affected by tariff increases or unknowingly imported items without understanding costs. Affected clients often found that the average landed […]
Unless a company is “bankable”, it is challenging to find manufacturing or production financing to fund working capital during the pre-invoicing stage of production. What is WIP? Work in process (WIP) is the part of the inventory that is being “worked on” or has an aspect of “conversion” and is yet in the production process. […]
Importers and exporters often avoid paying excise, taxes, and duties by using a third-party “bonded warehouse”. “A bonded warehouse, or bond, is a building or other secured area in which dutiable goods may be stored, manipulated, or undergo manufacturing operations without payment of duty. It may be managed by the state or by private enterprise.” […]
Funding inventory internally or from external debt sources is a key component for any manufacturer. Having capital tied up in inventory is a balancing act of fulfilling work in progress, understanding your cash conversion cycle and ensuring that you have adequate funds for the entire operation to run efficiently. The process of transforming finished resources […]
Head down to your local bank manager, get moved to the business banker and then shuffled to the trade team. If you’re lucky, you’ll speak to someone who understands supply chain financing. It shouldn’t be this difficult however, there are a few reasons why. Let’s dig in:
