How can I finance my initial stock orders?
I am a small start up business and would like to put into my warehouse some stock for re-sale into the UK market. I know I can factor or discount my invoices once I have made a sale, however I am not sure how to finance the initial stock order from my suppliers who want either cash or LC before they will supply me with the products. Does any one know how I can arrange finace for this…I am looking at around £30 -40K of stock
May 29th, 2010 at 8:59 am
most companies start with their own money or credit cards – might be very hard to get any kind of bank business loan in the current economy – especially if you do not have a Business Plan to show them
May 29th, 2010 at 9:32 am
Is this a new product? Test your prospective market before you pay our for a large amount of stock.
When we started stocking a new product 3 years ago, our supplier needed payment up front. We took orders and payment for the goods and then ordered and paid for them. We advised the customers that there was a 14 day delivery delay. It worked well and now our supplier gives us 90 days credit and we hold larger quantities of stock so that we can fulfil orders immediately.
It may be worth your while contacting your local Business Link. They have lots of help about importing and, if you need to apply for external financing, they help with your business plan and have information on sources of finance.
Good luck!