Stock Finance
Stock finance is a form of finance that is secured against your stock holding. It is important to understand your requirement as stock finance will only be available against the stock that you own that is in situ in your warehouse.
It may be that you need some form of purchase finance or trade finance to facilitate the purchase of the stock.
In order to source the most suitable source of finance to purchase stock we will need to understand the following:
- What stock are you buying?
- Will this stock be sitting in your warehouse or are you purchasing this stock against a confirmed order from a customer?
- Where are you buying the stock from?
- When does your supplier require payment?
- When will you need to access the finance?
Stock finance or purchase finance is typically a revolving facility that forms part of your working capital. If you have a stand alone stock facility you will typically be selling the stock on cash terms so the facility can be repaid.
If you are selling on credit terms the stock finance will typically run alongside an invoice finance facility. That means that once the stock is sold and the invoice is raised then the invoice finance facility can be used to repay the stock finance facility.
If you have a working capital requirement to purchase stock in the first instance it is probably best to contact the Smart Factoring Quotes team to discuss your requirement. That way we can ensure that we understand your requirement fully. It is important to understand your business process and importantly the timing of payments to ensure that the facility works.
