Invoice finance for wholesale: funding the next order while trade customers pay.
Wholesalers and distributors need to hold stock to serve customers, while those customers expect credit. Invoice finance can release cash from trade invoices to fund the next purchase.
Costs vs receipts, 8 weeks
Illustrative only. Every facility is priced and structured by the provider.
Typical issue
Funding stock while awaiting trade customer payment
The three ways cash gets stuck in wholesale
Why wholesale is different
Wholesalers and distributors sit between suppliers who want paying quickly and customers who expect credit. Invoice finance releases cash from trade invoices so the next purchase can be funded without waiting for the last sale to be settled.
Providers tend to like a spread of trade customers because it dilutes risk, although they will still look at the quality of the larger accounts. Returns, credit notes and rebates need to be handled cleanly as they affect what is eligible.
Because stock is often the other big use of cash, invoice finance is sometimes paired with a stock or trade finance facility. We can help you consider the combination rather than treating each in isolation.
How providers tend to look at wholesale
Facilities that tend to suit wholesale businesses
Confidential invoice discounting
For distributors with established credit control who want funding that grows with sales.
Find out moreInvoice factoring
Funding with the chasing of many smaller trade accounts handled by the provider.
Find out moreBad debt protection
Cover against customer insolvency within agreed limits, useful with a wide customer base.
Find out moreSelective invoice finance
Fund invoices to selected larger customers around seasonal peaks.
Find out moreIs invoice finance right for a wholesale business?
Indicators, not rules. Providers make their own assessments and some specialise in situations others avoid.
Signs it may suit you
- You sell to trade customers on credit terms
- Suppliers require payment faster than customers pay you
- Stock and seasonal buying strain working capital
- Your ledger and credit notes are reasonably well kept
Signs it may not be the answer
- Most sales are to consumers, or paid at the point of sale
- Returns and disputes are frequent and slow to reconcile
- You invoice ahead of delivery
If several of these apply, a specialist provider or another form of funding may be more appropriate. See the general suitability check.