Business funding for manufacturers
A manufacturer often has to buy raw materials and staff a production run before a purchase order turns into cash, and customers on 30 to 90 day terms stretch that gap further. Because the real problem is usually receivables and materials timing, invoice factoring and a line of credit are typically the first tools to look at, ahead of a term loan.
- One application, several lenders
- No credit pull to see your options
- No fee to you, ever
Common funding needs
- Buying raw materials to fill a purchase order
- Getting paid faster on invoices to business customers
- Financing production or packaging equipment
- Covering payroll during a large production run
What usually fits
Products that usually fit
- Invoice factoring to get paid on delivered orders now instead of in 30 to 90 days.
- Line of credit for raw materials and payroll ahead of a purchase order shipping.
- Equipment financing for production or packaging equipment.
- Term loan for a larger expansion.
Compare term loans, lines of credit, cash advances and equipment financing side by side →
Illustrative example
A worked example
A manufacturer has $80,000 in invoices out to customers on 45-day terms after shipping a large order. Factoring at an illustrative 90% advance puts about $72,000 in the account within days; when customers pay, the manufacturer receives the remaining $8,000 minus a fee, illustratively 2-4% for the period the invoices were outstanding.
Separately, a $40,000 line of credit draw to buy raw materials ahead of that order, repaid over 3 months at an illustrative 10-20% a year, runs roughly $1,000-$2,000 in interest for the period.
Illustrative example only, not an offer or a quote. Rates, fees and terms are set by each lender and depend on your business. Fees are not included unless stated.
Underwriting
What lenders look at
- Who your customers are and how reliably they pay
- Purchase orders on hand and typical payment terms
- Monthly bank deposits and production volume
- Age and condition of production equipment
- Owner credit and time in business
Honestly
Who this is not for
- A manufacturer with no purchase orders or invoice history yet
- Factoring invoices from customers who frequently dispute or pay very late
- Financing equipment a production schedule cannot support
If borrowing does not make sense, we will say so.
Are you a match?
Lender network minimums
Close but not quite there? Apply anyway and we will tell you honestly what is possible.
*Best available terms from lenders in our network. Every lender sets its own criteria; approval, amount and funding time are decided by the lender and not guaranteed.
| Time in business | 1 year+ |
|---|---|
| Monthly bank deposits | $20,000+ |
| Credit score | 500+ |
| Bank account | Business |
| Fee to you | $0 |
| Credit pull to start | None |
FAQ
Manufacturing funding questions
Is factoring a loan?
No. You sell invoices to a factoring company, and the cost depends on how long your customers take to pay.
Can a line of credit cover raw materials before a purchase order ships?
Yes, that is one of the more common uses, drawn against the limit and repaid once the order is invoiced.
Do you finance production equipment?
Yes, through equipment financing, often with the equipment itself as collateral.
What if my customers are slow payers?
Tell us who they are and how they typically pay. It affects factoring fees and whether it is the right fit.
Guides
Guides for manufacturing
Related
Similar businesses
Wholesale & distribution · Agriculture · Franchises
Where we work: all US states · all Canadian provinces
See your options
Two minutes, no credit pull, no fee. We come back with real options from lenders that fit.