Capital structured around the production cycle.

How do manufacturers finance a large order they cannot afford to fill?

With purchase order financing. You have a signed order from a real buyer, but not enough cash to buy the steel or the resin to fill it. A PO lender pays your supplier directly, you run the job, and the lender gets repaid when the customer pays the invoice. It is short-term money tied to one order, not an open line. The deal turns on your buyer’s credit, not yours. If the customer is a large retailer or an established OEM, the file is usually placeable even when your own balance sheet is thin.

What we see funded

• Equipment. CNC machines, presses, extruders, packaging lines. Specialty industrial-equipment lenders run different math than generalists — longer terms, often more aggressive on used iron.
• Raw material purchase orders. Buying inventory to fill a contracted order. PO financing is a specialty lane and usually competitive when the underlying customer credit is good.
• AR factoring. Manufacturers selling to large retailers or industrial buyers (Home Depot, big-box wholesalers, OEMs) often face 60–90 day terms. Factoring is the cleanest fix.
• Expansion financing. New facility, second shift, capacity expansion, technology refresh.
• Working capital. Smoothing the production-cycle timing gaps.

What a manufacturing deal usually looks like

A plastics shop doing $4.2M a year lands a $600K order from a national housewares brand. The resin alone costs $210K and the supplier wants payment before it ships. A PO lender pays the supplier directly. The shop runs the order over nine weeks, invoices on delivery, and the lender is repaid 45 days later when the brand pays. The shop never touches its own cash.

Equipment is the other common file. A used CNC machining center at $180K goes 72 to 84 months, and industrial lenders will finance used iron that generalists refuse, because they know what a 12-year-old machine actually resells for. On the AR side, a $400K receivable book against creditworthy OEM buyers factors at roughly 85%, so about $340K becomes available as the invoices go out.

What lenders look at

Manufacturing gets a heavier review than a service business, because there is more to go wrong between the raw material and the payment. Four documents carry the file.

• The WIP report. Work in progress — the jobs currently on the floor, what each is worth, and how far along it is. It shows the lender what is already sold but not yet billed.
• Customer concentration. How much of your revenue comes from your largest buyer. One customer at 60% of sales is a risk no matter how good that customer is.
• Supplier dependency. If one supplier is the only source for a critical input, a disruption there stops your production line and your ability to repay.
• Inventory turn. How fast raw material becomes finished goods and then cash. Slow turn means your money sits on the floor instead of in the bank.

Files that answer all four cleanly get longer terms and better pricing. We assemble those documents before the file goes out, so the lender is not guessing. Distributors face the same concentration and turnover tests, though they skip the WIP question entirely.

What we recommend

Buying a machine? Specialty industrial equipment financing, not a general business loan. Filling a large order? PO financing or an AR-backed line. Waiting 60 to 90 days on big customers? Factoring. Adding a shift or a building? A term loan, and often an SBA-eligible structure if you qualify. Day-to-day timing gaps? A line of credit.