A wholesale distribution company, selling products to large chain stores, faced a common challenge: long payment terms. Major retailers often require 30 to 90 days to pay invoices, leaving the wholesaler with cash flow gaps, even though demand for their products was growing. The company needed a way to cover operational costs like purchasing inventory and paying suppliers while waiting for these large chain stores to settle their invoices.
That’s when they discovered Factor & Fund and the benefits of invoice factoring.
The Cash Flow Issue: Growing Demand, Delayed Payments
The company was in high demand, selling products to well-known chain stores across the country. However, with high-volume orders came long payment terms, stretching their ability to manage cash flow. They needed funds to manufacture and restock inventory, cover shipping costs, and maintain their supply chain, but couldn’t afford to wait 60 or 90 days for payment from the retailers.
Traditional bank loans weren’t a practical option due to time constraints and the business’s growth needs. They sought a flexible financing solution tailored to their unique needs.
The Solution: Invoice Factoring from Factor & Fund
After connecting with Factor & Fund, the company was introduced to invoice factoring, an ideal solution for wholesale businesses that need to free up cash tied to invoices.
Here’s how it worked for them:
- Invoice Submission: The company submitted unpaid invoices from their large retail clients to Factor & Fund.
- Quick Advance: Within 48 hours, they received up to 90% of the invoice value. This immediate access to cash allowed them to reinvest in inventory, manage shipping costs, and meet operational demands without delay.
- Final Payment: Once the chain stores paid the invoices on their normal terms (after 60-90 days), Factor & Fund remitted the remaining balance to the wholesaler, minus a small factoring fee.
The Impact: Cash Flow Stability and Business Growth
Using invoice factoring, the wholesale distributor transformed its cash flow challenges into growth opportunities:
- Immediate Liquidity: They no longer had to wait for payment from large chain stores, giving them the ability to keep shelves stocked and meet rising demand.
- No Debt Accumulation: Invoice factoring provided working capital without the need to take on loans or new debt.
- Flexible Financing: The company could factor invoices as needed, scaling their funding in line with business growth.
A Client Testimonial
“Factor & Fund was the solution we were looking for. Before using invoice factoring, we constantly struggled with long payment terms from big retailers. Now, we have reliable cash flow to invest in inventory and continue growing our business. Factor & Fund’s flexibility and fast funding gave us the financial stability we needed.”
– Owner, Wholesale Distribution Company
Why Choose Factor & Fund for Wholesale Businesses?
- Fast Approvals: Receive up to 95% of your invoice value in as little as 48 hours.
- Tailored Solutions: We understand the unique needs of wholesalers selling to large chain stores and provide financing that fits your business.
- No Debt: Invoice factoring offers an alternative to loans, allowing you to maintain cash flow without incurring debt.
If your wholesale business is selling to large retailers and facing long payment terms, let Factor & Fund help. Contact us today or visit factorandfund.com to learn more about our invoice factoring and purchase order financing solutions.