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5 Things No One Tells You About Inventory Financing

To maximize your ecommerce potential and really set your business up for growth, you may need to think about inventory financing. After all, you’ve got to spend money to make money.

So whether you’re looking to launch a new product, optimize inventory management or run marketing campaigns, for example, you’re going to need cash to bring your growth drivers to fruition. In business, this cash often comes in the form of financing — especially when your cash flow is tied up due to Amazon’s payout delays.

5 Things No One Tells You About Inventory Financing

To maximize your ecommerce potential and really set your business up for growth, you may need to think about inventory financing. After all, you’ve got to spend money to make money.

So whether you’re looking to launch a new product, optimize inventory management or run marketing campaigns, for example, you’re going to need cash to bring your growth drivers to fruition. In business, this cash often comes in the form of financing — especially when your cash flow is tied up due to Amazon’s payout delays. </span

If this sounds like you, financing might be the right next step for your business growth. As you think about this decision, remember these five important considerations:

1. Personal Financing is NOT  Right for Business

In the same way you wouldn’t take out a business loan to buy a house, you shouldn’t take out a personal loan to invest in inventory or other growth areas. This is because business financing is different than personal financing. At the end of the day, business financing is designed to help your business grow. For example, a business financing company isn’t going to give you a loan unless you are already on a path for growth, which you prove with sales metrics and other business performance data. Personal financing, on the other hand, doesn’t take your business into account at all.

At the end of the day, you should only opt for business financing if you’re able to use it responsibly and make your payments in full and on time. No type of financing — business or personal — should be used to live beyond your means or pay other bills you don’t have cash for. Otherwise you’ll find yourself under a mountain of debt or in major financial trouble.

2. NOT  Getting Financing Might Be More Expensive in the Long Run

Ever heard of opportunity cost? By definition, it’s the loss of potential gains from one alternative when another alternative is chosen. In the case of ecommerce, the cost of not getting financing is often higher than the cost of getting it. Let’s think about it in terms of inventory.

• With financing: Because you’re able to invest in more inventory, you always stay in stock, meet demand, fulfill orders on time, build customer loyalty, and set your business up for long-term growth. Profits increase and you maximize your ROI.

• Without financing: You don’t have the funds to replenish inventory in real-time, so you run out of stock and lose sales — all while your competition gets your would-be business. In the worst case, you put your entire account at risk and may not be able to sell at all in the future.

Which option is more costly for you in the long run?

3. Understanding ROI is Paramount

If you’re borrowing money for inventory or a marketing campaign, for example, you want to make sure you’ll actually make sales. That means listing products that are well researched and in demand. The last thing you want to do is invest in a product that doesn’t sell — especially if you used financing to make the investment. To invest with confidence, look at your own sales history, talk to AMZ Advisers or consult a product research tool.

4. Scalability is Just As Important As Growth

It’s one thing to experience growth, it’s another to reach scalability. To scale, you need to achieve sustainable, long-term growth whereby your profits continue to increase as your costs decrease. This means, in part, that you need to be more efficient and cut your costs. One way to do this is through financing.

5. You Can Get Financing as Soon as Tomorrow…

… without a single credit check.

Yes, you read that right. Not all financing companies run a credit report as part of your application. For example, Payability — a financing company designed specifically for marketplace sellers — looks at your account health and sales performance to assess your creditworthiness. And they have a solution for every ecommerce need:

• Inventory & Other Growth Investments: Payability’s Instant Advance option is a great tool for large inventory or other growth investments. With this solution, Payability buys up to $250,000 of your future receivables at a discount, giving you a large lump sum of cash.
• Daily Cash Flow Help: With Instant Access, Payability pays you your Amazon income one business day after making a sale.
• On-The-Go Spending: Payability’s Seller Card allows you to spend your income on weekends and holidays anywhere Visa is accepted (all while also earning up to 2% cashback on your purchases).

Gina Goldring, an Amazon seller, is one of 2,500+ ecommerce sellers that has benefited from Payability. In fact, she grew her business by 50% in one month after her first Instant Advance. Learn more about Payability at http://go.payability.com/AMZAdvisers and get a $250 sign on bonus. Exclusive discounts are available for high volume sellers. [/vc_column_text][/vc_column][/vc_row]