Regional food distribution company uses distribution finance to fund operations
"Commercial Finance Partners understood our inventory financing needs."
Regional Food Distributor
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Distribution Finance

Distribution finance is for distribution companies that need to have inventory on hand to satisfy customer demand quickly. Most large retailers are unwilling to wait long lead times to replenish stock and are also unwilling to hold significant inventories. For this reason, large retailers rely on manufacturers and distributors to carry sufficient levels of stock to fulfill short term demands.

The most common types of distribution funding are:

The type of distribution finance that a company will be able to utilize is usually determined by the operating and financial history of a company. Distributors that have a proven track history can enjoy great rates from banks that offer asset based lending and supply chain financing.

Companies that have some operating history, however, are still in the early stages of growth can utilize SBA Loans at very good rates from banks and finance companies.

Companies that have limited operating history and or marginal credit can secure lending with a factoring company provided that the distributor's customers are credit worthy. Factoring can be an excellent stepping stone to more traditional asset based lending and other forms or distribution funding.

While there are several forms of distribution finance available, each has its positives and negatives. In many cases more than one form of financing can be used to generate capital. Choosing the right working capital facility with the right lender can make all the difference.

Call us today at 561-299-1609 to discuss your distribution finance options.

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