Running an apparel company typically involves buying the supplies to make the apparel, making and delivering the apparel, then waiting for agreed upon credit terms before receiving payment. This means that during the 30 to 90 days you are waiting for client payment, your available funds to purchase more supplies, cover labor costs, and deliver more goods to a different or the same client are strained. This leads to cash flow problems that slow your apparel company’s growth. Invoice factoring, partnered with purchase order finance, helps grow your apparel business.
Purchase Order Finance: Apparel Companies
Purchase order financing is a working capital funding solution that allows your business to take on larger volumes of sales. Often, an inhibitor to growth for an apparel company is having the cash on hand to purchase supplies and deliver the finished goods to the debtor. Straining your finances even more is waiting to be paid by the debtor. Purchase order financing for apparel companies means advancing money to an apparel company, so your supplies, delivery, and labor costs are covered, allowing you more freedom to take and fulfill other orders rather than waiting for payment.
Apparel PO Funding
Purchase order funding, or PO Funding, is a working capital financing solution that is used in combination with business receivables funding. What this means is that your business sells your business receivables or invoices to a factoring company at a discount of 1% to 4% for immediate payment. After the 30 to 60 to 90-day credit terms expire, the factoring company collects the invoice amount from your debtor. PO Funding advances even more money to your business. The PO Funding company, like Eagle Business Credit, gives your business the capital to cover upfront costs like labor and supplies.
Growing Through Apparel Purchase Order Finance
Margins can run tight when waiting for customer payment after delivering goods. This waiting period causes missed opportunities to take on more clients or larger volumes. PO Funding for apparel companies is a solution that allows your apparel company to continue taking orders and growing during the periods you might normally be waiting for payment. PO funding is debt free and not reliant on your personal or business credit.