Guidelines on How Manufacturing and Import Companies Can Access Financing
Manufacturing has a significant part to play in the progress and advancement of a nation. Getting raw materials and making finished products for the regional and export market. Similar, import companies also contribute to this supply and development. These companies use a lot of capital to meet the demand for these services and products. View more here to find out how these companies can access financing and the financing options available.
Inventory financing can help you acquire financing for your manufacturing and import business. This is an expensive option though very effective. By using your list of stock, you can acquire finance that will let you import the products that you can supply to your customers. Using your inventory to obtain financing will let you accumulate more inventory without changing your cash flow pending payment of the debt.
Also, financing can also be accessed through your company’s assets. This involves selling your credit accounts to a commercial finance company. The finance company will buy the credit accounts at a percentage discount of the actual value of the credit accounts. The finance company will give you an advance payment for the accounts for a small fee that you would have to wait until their payment.
A purchasing order financing will also allow you access to finance your company. Purchasing order financing is almost similar to asset-based financing. This alternative involves giving your invoices and purchase orders to a financing company that will buy them. The finance company will take on the liability and the responsibility of charging and receiving the payments. The finance company will supply the products, collect the payment and give you the profit as well as collects its share. The purchase order financing is not cheap compared to a bank loan. It is suitable when the banks are not lending money, and your profit margin is high enough for the good that you are importing. This option also requires you to have a good supply chain and creditworthy customers.
Accessing a bank loan is also an option for the manufacturing and import companies. The financing that you can acquire will be based on different factors. The bank will consider your creditworthiness and decide on the amount that can be loaned to you. The financing agreement will spell out the monthly payments that should be made and for how long.
Financing options let your company keep operating and the maintaining supply of products and services