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Financing Purchase Orders
          Purchase Order Finance or "PO Funding" can be one of the more difficult types of commercial finance to secure for fast growing businesses.  Factors, however, routinely provide some amount of purchase order finance as "pre-ship" invoice financing. 

       Traditional purchase order finance is provided through companies that specialize in that transaction.  At Aegis Factors, our clients benefit from our established relationships with some of the largest providers of purchase order finance nationwide.
 

At Aegis Factors, we provide purchase order finance for existing client based upon factoring volume.  In cases of large purchase order, we maintain relationships with the largest purchase order providers in the nation.

How It Works
     While requirements and qualifications for purchase order finance will vary from lender to lender, some are relatively standard.  To qualify for purchase order financing your business generally must:

• have an established factoring relationship.

• not be re-packaging or simply creating an inventory with the product.

• have an established and acceptable credit history.

• be funding orders of significant size ($100,000 and larger).

      The most typical form of purchase order finance international transactions where a manufacturer receives a very large order from a domestic retailer (such as Walmart, Target, Costco, etc) and due to the size of the purchase order, lacks the funds to actually manufacture in China, India, Taiwan, or some other international location.  A purchase order finance company will provide the necessary capital and expertise to oversee the foreign production and the delivery of the goods directly to the customer (Walmart, Costco etc.)  Once delivered and invoiced, Aegis Factors will advance on the shipment and pay the purchase order finance company for its services.

What It Costs
       Generally, purchase order finance is similar in cost to factoring.  Purchase order finance, since it finances wholesale production, involves less capital and although the posting of letters of credit and other "deal specific" costs can add service charges, overall the costs, as they relate to factoring, are very similar.

Who Should Apply to Aegis Factors
        Aegis Factors has vast experience in import-export trade finance and maintains strong working relationships with many company that specialize in purchase order finance.  Small purchase orders are generally handles as simply part of your overall factoring facility at Aegis.  Fro larger orders of $100,000 and up, we will provide the necessary arrangement through one of our many purchase order partners.