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Purchase Order Financing

Do you have a purchase order from a client and need financing to pay your suppliers? Purchase order financing can provide you with the funds to pay suppliers and deliver large purchase orders.

Our program enables you to close more transactions and grow your sales. And, unlike conventional financing options, purchase order financing is available to small businesses and can be set up quickly.

We can provide purchase order financing at competitive rates. Get an online quote or call us toll-free at (877) 300 3258 to speak to a representative.

Benefits

Our purchase order financing program has a number of benefits that can help your business grow, including:

  • Provides funding to pay suppliers for confirmed orders
  • Allows you to take on more – and larger – purchase orders
  • Has no transaction maximums
  • Is easy to use and set up

How does purchase order financing work?

The program is relatively simple and can be used by most companies that resell finished goods, including re-sellers, suppliers, and wholesalers. Purchase order financing works as follows:

  1. You get a purchase order from your client.
  2. You place the order with your supplier.
  3. We pay your supplier, usually with a letter of credit (the payment method varies).
  4. Your supplier delivers the goods and your client receives them.
  5. Your client pays for the goods. This payment settles the transaction.

Learn more by reading “How Does Purchase Order Financing Work – a Sample Transaction.”

Qualification Criteria

To qualify for purchase order financing, your company must:

  1. Have creditworthy customers
  2. Resell unmodified products
  3. Have profit margins of at least 20%
  4. Have invoices free of liens
  5. Not have serious legal or tax problems

Costs

The cost of purchase order financing varies and is based on your sales volume, the creditworthiness of your clients, and the structure of the transaction. Cost range between 2% and 3% per month.

Transaction settlement

Most purchase order financing transactions are settled using factoring – because factoring often lowers the total transaction cost. However, this settlement method should be evaluated on a case-by-case basis.

To learn more about using factoring with purchase order financing, read “Why Must Purchase Order Financing Transactions Use Factoring?

Instant quote

We can provide purchase order financing at competitive rates. Get an online quote or call us toll-free at (877) 300 3258 to speak to a representative.

Learn more

Would you like to learn more? We have an extensive resource centre and blog. Popular articles include:

Locations

We offer our financing services in provinces across Canada. For specific information, visit: