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Vendor Finance
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What is Vendor Finance?
Small to mid-sized enterprises understand how crucial managing cash flow to success. Vendor financing is also known as trade credit, where a vendor allows a certain period before charging the customer for the goods purchased.
In the recent years, Australian businesses increased operating expenses due to higher cost of materials, fuel, and wages. Hence, you’d want to find solutions that enable you to avoid steep upfront costs when purchasing business equipment. Vendor financing allows you to have a more ideal timeline for buying products and services. Your vendor gives a line of credit, and you foster rapport with regular repayments.
Whether you are a retailer, manufacturer, or service provider, Intellichoice lets you access the best vendor finance options right now. Having the line of credit with your vendor can mean the difference between faster growth or sacrificing working capital. With our business loan specialists, you cover your expenses in the most efficient way.
Ready to look for vendor finance service?
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How Vendor Finance Works
Vendor financing makes it possible for business owners to buy goods or services without securing traditional bank loans or pledging assets as collateral. Entrepreneurs work directly with vendors to establish a line of credit.
Vendor finance involves these steps:
- Your business enters into an agreement with a lending institution that offers vendor finance
- You place an order with one of your vendors and request a credit line – to pay for the goods or services at a later date.
- The lender pays the vendor on behalf of your business.
- Your company then repays the lender over time, typically with higher interest.
With vendor finance, borrowers can build a trusting relationship with vendors because of timely payments. Competitive rates plus your business’s ability to improve credit rating are among the key benefits to this loan product. As for suppliers, even though their client makes the payments via a lender, vendor finance ensures that they make the sale with their goods or services.
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What Vendor Finance Gives Your Business
Vendor finance is not necessarily offered by all institutions, because it is considered high risk for vendors. Borrowers could risk default if there are late payments; there’s also the possibility of the business filing for bankruptcy. Vendor finance involves risks, but there are key advantages that a borrowing business should consider:
Working with our loan specialists is your smartest route towards securing vendor finance. With our in-depth business loan research and close coordination with lenders, you can shelf traditional bank financing and have a faster way to fund your business.
Talk to our specialists about vendor finance
- Financing Without Collateral. Vendor finance doesn’t typically require collateral, which makes it an attractive feature for businesses that may not have valuable assets to leverage as collateral for loans.
angle - Purchase of Crucial Goods. Businesses can buy goods or services that are otherwise too costly if you go the route of traditional business loans.
angle - Maximizes Cash Flow. Vendor finance supports liquidity by allowing small and medium-sized businesses to defer upfront payments to their supplies, freeing up cash for other expenses.
angle - Impact Credit Score. Making timely payments to financing institutions reflects positively on the credit rating, opening up other financing opportunities in the future.
- Financing Without Collateral. Vendor finance doesn’t typically require collateral, which makes it an attractive feature for businesses that may not have valuable assets to leverage as collateral for loans.
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WE ARE TRUSTWORTHY
Why Choose Intellichoice
With over two decades of experience in the financing industry, we provide a variety of vendor finance solutions for small and mid-market businesses. Clients trust our brokerage service because we have a team of finance specialists dedicated to helping businesses increase sales and grow without risking valuable assets. Intellichoice has access to a wide network of lenders that go beyond the traditional financing options – we secure customized loans so you can focus on achieving more for your business.