How Purchase Order Financing and Accounts Receivable Financing Supported Growth for a Consumer Products Company
The Situation:
A California-based consumer products company specializing in branded trading card games was experiencing rapid growth driven by increasing demand from domestic and international retailers and specialty distributors. As order volume expanded, the company needed additional working capital to fund a significant production run with its overseas manufacturer while managing extended payment terms from wholesale customers.
Although sales were strong, the timing gap between paying for inventory production and collecting customer payments created a cash flow challenge that threatened to slow growth and limit the company’s ability to fulfill new orders.
The Solution:
SouthStar Capital structured a $750,000 combined Purchase Order (P/O) and Accounts Receivable financing facility tailored to the company’s operating cycle.
The Purchase Order financing component provided funding to support manufacturing costs with the overseas supplier, ensuring inventory could be produced and delivered on schedule. Once products were shipped and invoices were generated, the Accounts Receivable financing facility supplied ongoing working capital by advancing funds against receivables from established distributors and retailers.
This combined financing solution created a seamless source of capital from production through customer payment, allowing the company to meet growing demand without straining cash reserves.
The Result:
With access to $750,000 in flexible working capital, the company was able to fund inventory production, fulfill large purchase orders, and maintain healthy cash flow throughout the sales cycle.
The financing facility positioned the business to capitalize on continued market demand, strengthen relationships with distribution partners, and support ongoing expansion across domestic and international markets. By bridging the gap between manufacturing expenses and customer payments, SouthStar Capital provided the liquidity needed for the company to scale confidently and pursue future growth opportunities.