Keep inventory moving and cash flowing. Financing from $10K to $2M for distribution companies — covering inventory, logistics, fleet, and net-term gaps.
Distribution companies operate in a capital-intensive, margin-thin environment where the timing of cash inflows and outflows rarely aligns. You purchase product from manufacturers or wholesalers, warehouse it, and deliver it to buyers — all before you see a single dollar of revenue. The larger your distribution territory, the more capital you have tied up in inventory, fleet, and outstanding invoices at any given time.
Unlike service businesses that can scale without proportional capital increases, distribution scales with inventory. Adding a new product line means buying more stock. Adding a route means a new vehicle, driver payroll, and fuel costs. Every growth move in distribution requires capital in advance of revenue — and that capital gap is where most distributors get stuck.
Distributors must maintain adequate inventory levels to avoid stockouts — which destroy customer relationships — but overstocking ties up capital and increases warehouse costs. The inventory sweet spot requires working capital to maintain, especially when suppliers offer volume pricing that requires large minimum orders.
Retailers, grocery chains, and institutional buyers routinely pay on net-30 to net-60 terms. A mid-size distributor with $200,000 in monthly deliveries may carry $200,000–$400,000 in outstanding receivables at all times. This is capital that belongs to you but is temporarily inaccessible — and the business cannot pause to wait for it.
Delivery vehicles are the lifeblood of a distribution company, and they require constant maintenance, periodic replacement, and insurance coverage. An unexpected breakdown or a failed DOT inspection can ground a vehicle and disrupt customer deliveries — creating both a cost and a revenue impact simultaneously.
Most distribution businesses face intense seasonal demand variations. Food and beverage distributors see spikes around holidays. Construction material distributors peak in spring and summer. These predictable surges require capital build-up in advance of the season, often weeks or months before the revenue arrives.
Invoice factoring is the fastest way for a distribution company to eliminate the net-terms cash gap. Rather than waiting 30–60 days for buyers to pay, you sell outstanding invoices and receive 80–90% of their face value within 24–48 hours.
For a food distributor with $180,000 in outstanding invoices to grocery chains on net-45, factoring releases $144,000–$162,000 within two business days. That capital immediately funds the next inventory purchase from the supplier — completing the distribution cycle without interruption.
Factoring is particularly powerful for distribution companies because:
Working capital loans provide lump-sum capital for any distribution expense: inventory, driver payroll, fuel, warehouse rent, insurance, or route expansion. Repayment comes via fixed daily or weekly ACH, making the cash flow impact predictable and manageable.
Working capital is the right product when you need general operational liquidity rather than a solution tied to specific invoices. Common distribution scenarios:
Distribution companies can finance delivery vehicles, refrigerated trucks, forklifts, pallet jacks, warehouse racking, and other essential equipment through equipment financing. The equipment itself typically serves as collateral, making approval easier and terms more favorable than unsecured products. Terms run 12 to 60 months with fixed monthly payments.
A revolving line of credit gives distribution companies a standing pool of capital to draw from as needed. It is ideal for managing seasonal fluctuations, covering unexpected expenses, or maintaining a safety net without paying for capital you are not using. Draw, repay, and draw again as business demands shift.
Revenue-based financing advances capital against future revenue, repaid as a fixed daily or weekly ACH. For distributors with consistent monthly revenues and predictable reorder cycles, this is a straightforward way to access $50,000–$500,000 quickly with minimal paperwork.
| Criteria | Minimum | Preferred |
|---|---|---|
| Time in Business | 6 months | 2+ years |
| Annual Revenue | $120,000 | $500,000+ |
| Credit Score | 550+ | 620+ |
| Monthly Bank Deposits | $10,000 | $40,000+ |
| Invoices for Factoring | $25,000 | $100,000+ |
| Industry | Most distribution sectors | Any goods distribution |
A Southeast regional beverage distributor serves 240 convenience stores, restaurants, and grocery accounts. The business generates $2.8M annually but carries $320,000 in outstanding invoices at any given time due to net-30 payment terms. By factoring $320,000 in invoices monthly, the distributor accesses $272,000 immediately — funding the next inventory purchase from the beverage manufacturer and covering driver payroll for the month. The factoring fee of approximately 1.5% per 30 days costs $4,800 — a small price for immediate access to $272,000.
A Midwest industrial supply distributor wants to add two new distribution routes covering three additional counties. Startup costs include one used delivery van ($28,000), initial inventory for the new territory ($65,000), and two months of driver payroll before the routes reach profitability ($22,000). A $120,000 working capital loan covers the expansion — funded within five business days of application. The daily repayment of $600 is covered by the existing routes' cash flow while the new routes ramp up.
Distribution company loans are financing products that help distributors fund inventory, cover fleet and logistics costs, and bridge the gap between paying suppliers and collecting from buyers on net terms.
Most distribution companies qualify for $10,000 to $2,000,000 depending on revenue, time in business, and outstanding invoices.
You sell outstanding invoices to a factor and receive 80–90% of their value within 24–48 hours. When buyers pay, the factor releases the remaining balance minus their fee (typically 1–5%).
Yes. Invoice factoring qualifies based on your buyers' credit. Working capital and line of credit products are available from 550+ credit scores with strong monthly revenue.
Yes. We finance delivery vehicles, refrigerated trucks, forklifts, and warehouse equipment with terms from 12 to 60 months. The equipment typically serves as collateral.
Bulk inventory purchases, fleet maintenance, driver payroll, warehouse rent, seasonal inventory build-up, new route expansion, and general operational costs.
Most applicants receive a decision within 24 hours. Funding arrives in 2–5 business days after acceptance.
Food and beverage, industrial supply, medical supply, electronics, construction materials, consumer goods, alcohol and spirits, and more.
Apply in 5 minutes. Fast approvals. Capital when your routes need it.
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