Purchase Order Funding - Leveraging OPM.

OPM. Other People's Money. We have all hear the term. Most of us associate it with using bank financing or angel funding to grow your business. However, purchase order financing should be the quintessential OPM.

A quick summary: Purchase order funding is a tool that helps importers, distributors and wholesalers who have large purchase orders and have exhausted their bank financing. If oyu have a large PO at hand. The po financing company provides the necessary letters of credit to pay your suppliers. The transactions is settled once your clients pay their invoices.

If structured correctly, this type of financing can be set up with few out of pocket expenses. It allows you to leverage the PO financing company's money (Other People's Money) to make and deliver a sale.


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