Your biggest order ever just arrived. Good problem. Hard problem.
A distributor order can double your year in one PO — and demand more cash than you've ever deployed at once, on terms you've never floated.
One order that outweighs your whole balance sheet
Distributor economics are a different sport. Volumes are 10–50x your DTC order size, margins are thinner, and payment terms stretch to net-60 or net-90. The order is real and the relationship could define your next three years — but saying yes means producing more inventory than your business has ever financed.
The trap is partial commitment: taking the order, funding what you can, and shorting the shipment. Distributors plan their own downstream commitments around your delivery. Shipping 60% doesn't earn you 60% credit — it earns you a reputation.
The good news: an order this concrete is exactly what order-secured capital is for. A confirmed PO from a creditworthy distributor, verified supplier costs, and a clear delivery schedule is an underwritable package even when the number is scary.
The structures that fit this moment
Honest pros and cons — none of these is right for everyone.Purchase order financing
Built for this. The lender funds production against the distributor's PO; qualification leans on their credit, and the facility is sized to the order — even when it dwarfs your history.
- Qualification rides on your buyer's credit, not just yours
- Scales with the order — a $2M PO can be financed even if you've never borrowed
- No dilution, and it disappears when the order is done
- –Only works with confirmed POs from creditworthy buyers
- –Fees compress your margin — thin-margin orders may not pencil
- –The lender is in your supplier relationship; expect verification calls
Inventory financing
If you're producing ahead of confirmed orders to hit a distributor's rolling forecast, inventory-secured capital bridges production to sell-in.
- Sized to the order, not to your credit limit
- Keeps working capital free for ads and payroll
- Lenders in this space understand lead times and sell-through curves
- –The lender will scrutinize your velocity data — slow movers won't qualify
- –Usually product-category dependent; perishables and fads are harder
- –Adds process: inspections, warehouse agreements, sometimes lien filings
What lenders will actually look at
No mystery underwriting. This is the review, in the open — so you know where you stand before anyone else does.
The questions sellers actually ask
The order is 5x anything I've done. Will anyone actually fund it?+
This is the one situation where deal size can exceed your history, because the underwriting anchors on the purchase order and your buyer's credit. A $2M PO from a rated distributor is fundable behind a $400K/year business — it happens regularly.
Should I even take an order this big?+
Fair question, and not a given. If the margin after financing cost is thin and the distributor demands exclusivity or aggressive terms, walking away can be right. We'll help you pressure-test the math before you're committed either way.
What if the distributor pays late?+
Priced in — facilities are structured around stated terms plus realistic slippage. Chronic late payers show up in credit checks, which is exactly why lenders (and we) run them first.
How fast can this move?+
PO verification, supplier confirmation, and credit checks typically take 1–2 weeks. If your production window is tighter, say so immediately — some lenders can compress, and knowing the real deadline changes who we call.
See which lenders fit this exact situation.
Five minutes to a matched shortlist. No credit pull, no obligation.