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. From raw materials to finished products, these companies ensure a supply of their finished products for the local and international market. This also is the case for the import businesses that fill the need for products and services to the country for development and progress. 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. Inventory financing can be costly but is an efficient way of getting finance. You can access a loan by using your current inventory so that you can import the goods that your customers’ demand. 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 will include a finance company to buy your credit accounts. 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. This option is almost similar to asset-based loans. This option involves presenting your invoices and purchase orders and selling them to the commercial finance company. The finance company assumes the risk and the task of billing and collecting. The commercial company will supply the goods and get payment, and also gets its cut and sends you the profit. This option expensive compared to a bank loan. It is applicable when banks are not giving out loans, and your profit is high. Purchasing order financing require you to have creditworthy customers and an excellent supply chain.
Bank loans also offer financing option t import and export companies. The amount that you can access for your import or manufacturing company will depend on various factors. The bank will look into the amount that you can access and make the decision based on your creditworthiness. The agreement that the bank and your company get into will require you to make payments on a monthly basis for a stipulated amount of interest and period.
Financing options let your company keep operating and the maintaining supply of products and services