What is Purchase Order Funding?
A purchase order is a commercial document that is issued by an entity’s purchasing department when placing an order with its vendors or suppliers. Commonly, medium to large enterprises issue purchase orders to other businesses to ensure the correct procurement of a particular service or product. In South Africa however, the government is the biggest buyer and issuer of purchase orders with a spending of more than R500 billion per year as part of its conscious effort to try to stimulate the growth of small businesses. Small businesses however do not always have the means and financial capability to either procure the ordered goods or render the necessary services in advance, knowing that they will only be paid a few weeks or months after fulfilment of the purchase order.
Purchase Order Funding, therefore, entails that funding is provided to the business that was issued with a purchase order to put them into a position to fulfil the purchase order and allow the business to be paid. The Purchase Order Funding company often pays the suppliers of the products and or services directly and works with your business to ensure that your business gets paid by your debtor that issued the purchase order.
Does my business qualify for Purchase Order Financing?
Although ProfitHub considers all proposed transactions on their own merits, transactions that conform to the following minimum criteria will take preference over others.
Here are the following prerequisites to qualify for a Purchase Order through ProfitHub:
- The client that issued the Purchase Order must preferably be a governmental institution, parastatal or listed and a credible entity.
- The Purchase Order value payable by a client must be a minimum of R250,000 or more.
- The Gross Profit of Such Purchase Order must be a minimum of 30% or more.
- The delivery date of the goods must be reasonable and afford enough time for ProfitHub and relevant suppliers to complete the order.
If you/your business find yourself in the lucky position of meeting all these requirements, that means that your Fast Purchase Order Funding is only a simple click away!
Visit ProfitHub for more information.