Stock Finance

Stock Finance is a revolving credit facility which utilises the value of inventory as security.

It can be used to either release working capital against the value of existing stock owned and stored by the company, or it can be used to purchase stock from a supplier who will continue to store it for a set period of time.

Stock Finance works particularly well for businesses who need to purchase a large amount of stock which they will subsequently sell to multiple individual customers. Many businesses are not able to store sufficient stock to match future demand (or the future demand may be unknown), this creates a potential reputational risk by being under stocked and not able to fulfil orders.

For example, using Stock Finance a business can purchase a large amount of stock (e.g. electronic items, furniture etc) at wholesale prices from a supplier who agrees to store the items pending sales. The business advertises the items for sale to individual buyers at retail prices and the supplier then dispatches items directly to the end customer to meet each individual sale.