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Pay your supplier on a confirmed order through one of our direct lending partners, or fund the gap with working capital we provide in house.
Purchase order financing pays your supplier so you can fill a confirmed order you could not otherwise fund, and it is retired from the invoice once your buyer pays. Full Send Funding arranges it through direct lending partners rather than funding it itself. We talk through your options with you first, and a purchase order facility is placed with a partner only when it is the better fit and only at your discretion. Placement is free: we charge no fee for arranging it, and the partner’s written terms state its full cost before you sign. What we fund in house is working capital, and for many order gaps that is the simpler answer.
Three parties handle the money. The partner confirms the order with your buyer and the quote with your supplier, then pays the supplier directly or through a documentary credit. The goods ship and you invoice. Your buyer pays into an account the partner controls, or a factor advances against the invoice and settles the partner first. The partner takes back what it paid the supplier plus its fee and releases the rest, your margin less the cost of financing, to you. Because repayment comes from your buyer, your buyer's credit weighs more than your own.
Two things decide whether it is worth doing, and both are yours to check before you apply. The first is margin: every financed day between paying the supplier and being paid by the buyer comes out of gross margin, and the facility ends at the invoice, so a buyer on net terms leaves a second gap to finance as well. The second is how much of the cost is bought-in finished goods. The product fits a distributor, wholesaler or importer reselling goods someone else made complete, and it reaches little of a manufacturer's cost, because labour, machine time and materials that will be transformed are not a supplier invoice. The partner's terms, including the fee, the amount, any filing against the order or the goods, and how your buyer is told where to pay, are set out in writing before anything is signed.
A purchase order facility is sized by the partner against the order, meaning the supplier cost of fulfilling it and the buyer behind it, rather than against your deposits, and the amount is stated in writing with the partner's other terms. That is why a young business holding a large order from a strong buyer can sometimes raise more against the order than against its own statements. If working capital we fund in house fits the need better, it is sized the usual way: 80%–150% of average monthly revenue, within $5,000 to $10 million.
Yes, through direct lending partners: we arrange it rather than fund it ourselves. Working capital and unsecured funding are what we fund in house, and they are the core of what we do. Purchase order financing is a specialised product, so when it is the better fit we place it with a direct lending partner, after a conversation with you about the options and only with your agreement. The partner provides the facility on its own terms, which are set out in writing before you sign anything.
No. When a partner product is the better fit, we place the file with a direct lending partner chosen with you after we have talked through the options, and only with your agreement. We do not send a file out wide or shop it around, and we never pass it to a broker to place. If a product we fund in house fits better, the file stays with us.
Because repayment comes from the buyer. The facility is retired when your buyer pays the invoice, so a partner assesses the buyer's standing, the terms of the order and the supplier's record before it looks hard at your own balance sheet. That is why a young business holding an order from a substantial buyer can be a workable file, and why an established business with a marginal buyer often is not.
Then purchase order financing reaches too little of the problem. It pays suppliers against one order; labour, machine time and the overhead of a production run are not supplier invoices, so a manufacturer using it still funds payroll through the whole run from its own cash. That shape is usually better served by working capital we fund in house, sized from your deposits, which you direct across materials, payroll and the wait for your buyer to pay.
Often, if your buyer pays on terms. The purchase order facility ends at the invoice, and a partner will not usually wait out the buyer's terms, so the invoice is commonly factored to retire it. The two are sized against each other and are best arranged together; a factoring advance that falls short of retiring the purchase order funder is made up from your own cash. Our invoice factoring page covers that half of the arrangement.
That is set by the partner, in writing, before anything is signed, so read the collateral description rather than assuming. Purchase order facilities usually give the funder an interest in the order, the goods and the resulting invoice, because that is how the product is repaid, and an existing blanket UCC-1 against your business may need to be subordinated before a partner will close. Our own working-capital agreements carry no UCC-1 lien against the business and no confession of judgment on the deal sizes our FAQ states, but that describes what we fund in house, not a partner facility.
Longer than an advance, and third parties set the calendar. The partner has to confirm the order with your buyer and the quote with your supplier, and an existing lender may have to agree to subordinate its filing; none of them works to your ship date. The partner states its own timeline. Our decision on the in-house options comes within 24 business hours, and when a ship date is closer than a facility can close, working capital we fund in house may be the route that arrives in time.