Fill the order. Keep the company.
PO financing for retail suppliers works like this: when a retailer commits to an order, a lender advances the cash to produce it (ingredients or materials, manufacturing, packaging and freight). You deliver to the retailer, and the lender is repaid when the retailer pays your invoice, usually 90 to 180 days after production starts. You keep the margin and the equity.
Official capital partner to these retailers
How it works
Every retail order follows the same path from buyer commitment to retailer payment. PO financing covers the cash you need in the middle.
The cash cycle
Most of the cost of a retail order is paid months before the retailer pays you. Typical timing for a CPG order:
| Stage | Typical timing | Cash going out | Cash coming in |
|---|---|---|---|
| Buyer commitment to formal PO | 0 to 6 weeks | Ingredient, component and packaging deposits often start here | None |
| Production | 4 to 10 weeks | Manufacturing, packaging, labels | None |
| Freight to retailer DCs | 1 to 3 weeks | Inbound and outbound freight | None |
| Retailer payment terms after receipt | 30 to 90 days | Ongoing overhead | Retailer pays the invoice, less any deductions |
Add those together and a brand is out of pocket for roughly three to six months on every order. On a first order or a store expansion, that number can be several times a normal production run.
Worked example
A snack brand wins a $500,000 order (wholesale value) from a national retailer. Producing it costs $300,000 in ingredients, co-manufacturing, packaging and freight. The gross margin is $200,000.
| Item | Amount |
|---|---|
| Order value (wholesale) | $500,000 |
| Cost of goods financed (up to 100% of eligible COGS) | $300,000 |
| Time outstanding (production through retailer payment) | 4 months |
| Financing cost at 1.5% per month | $18,000 |
| Financing cost at 2.3% per month | $27,600 |
| Margin kept, before deductions and other costs | $172,400 to $182,000 |
The brand ships the full order without using operating cash and without selling equity. Raising the same $300,000 from investors at a $5M pre-money valuation would cost about 6% of the company, which is worth far more than $18,000 to $27,600 at exit. Rates are illustrative and depend on the deal.
Retail suppliers
Most PO financing guides are written for distributors and importers. Selling to a major retailer changes how the financing should work in five ways.
Retail buyers commit to volume at line reviews and in buyer notes, often weeks before the formal PO is cut. Ingredient and packaging lead times do not wait for paperwork. A lender that only funds against a signed PO funds too late for many brands.
Large retailers pay their invoices. What goes wrong is production: a co-manufacturer slips, packaging is late, a shipment misses its delivery window. Good underwriting for retail suppliers focuses on whether the order can be produced and delivered, not only on the retailer's credit.
Retailers can deduct allowances, promotional costs, and fines for late or incomplete deliveries from what they pay you. Build those into your margin before you size the financing, because the financing is repaid from what the retailer actually remits.
Supply chain finance and early-pay programs speed up payment on approved invoices. They are useful, but they start after delivery. They do not pay for production.
A retail relationship means replenishment orders and store expansions, not one transaction. A facility that funds each new order as it comes in is more useful than re-qualifying from scratch every time.
Underwriting
At Bridge, a buyer commitment is enough to start. A signed PO helps when you have it. It is not a gate.
What it costs
PO financing is usually priced per month that the money is outstanding. Across the market, published fees run roughly 1% to 6% per month, and some lenders add a separate factoring fee once the invoice is issued. Bridge rates are generally 1.5% to 2.3% per month, with one facility that is repaid when the retailer pays and no daily debits. Walmart and Sam's Club suppliers can get better pricing through Bridge's partnership. Read the program terms on Walmart purchase order financing.
Three things drive the total: how much of the cost of goods is financed, how long production and shipping take, and how long the retailer takes to pay.
A large purchase order creates a temporary cash need. Giving up ownership is permanent. Use short-term capital for short-term needs. Save equity for building the company.
PO loan cost vs equity at exit
Illustrative. PO cost uses your selected monthly rate over a 3-month cycle.
PO financing vs other loan types
Factoring, supply chain finance, and most bank lines wait until after you ship. Merchant cash advances pull cash every day. Production financing is the option that pays for the order before delivery.
| Option | When it starts | What it covers | Tradeoff |
|---|---|---|---|
| Bridge production financing | When the buyer commits | Production and COGS before shipment | Sized to the buyer opportunity, not historical AR |
| Traditional PO financing | After a signed PO | Supplier payment once paperwork lands | Waits on formal PO; misses earlier buyer-note window |
| Invoice factoring | After you ship | Advance against the receivable | You still fund materials and production first |
| SCF / early pay | After invoice approval | Faster retailer payment on approved invoices | Useful later in the cycle, not for manufacturing |
| Bank LOC / ABL | When the line is available | Working capital against history and collateral | Sized to historicals, not the new order |
| Merchant cash advance | Any time | Lump sum against future revenue | Daily withdrawals, high effective cost, not order-tied |
Want the long version? The CPG Financing Guide walks through every option, what each one costs, and the numbers lenders check. Sizing the cash for more stores? The Retail Growth Budget estimates peak cash from your store count. Estimating this order? The production financing calculator turns order size and margin into a cost.
How Bridge does it
Traditional PO lenders fund against paper. Bridge funds against the buyer.
Watch
A short film on the wait between producing a retail order and getting paid, and how that gap gets covered without daily payments or a long approval.
Growing inside retail takes capital. The film shows the wait between producing an order and the retailer paying, then the terms that matter for that gap: no daily payments, and no long approval.
Common questions
Straight answers for retail suppliers, including what PO financing is and how it works.
When a retailer commits to an order, a lender advances the cost of producing it: materials, manufacturing, packaging and freight. You deliver to the retailer, invoice, and the lender is repaid when the retailer pays. The financing covers the 90 to 180 days between paying for production and getting paid.
PO financing is short-term debt that pays for producing a retail order. It covers ingredients or materials, manufacturing, packaging and freight. You repay when the retailer pays your invoice. It does not take equity, and it is sized to that order rather than to your historical sales.
Most PO lenders require one. Bridge does not. We can fund from buyer notes, a line review result or another retailer commitment, because retail buyers often commit weeks before the formal PO is issued and production deposits cannot wait.
Market pricing runs roughly 1% to 6% per month, sometimes plus a factoring fee after delivery. Bridge rates are generally 1.5% to 2.3% per month, depending on the deal, and paying early lowers the cost. Walmart and Sam's Club suppliers can get better pricing through the partnership.
PO financing covers the cost to produce the order, not the order's sale value. Bridge funds up to 100% of eligible cost of goods, with facilities from $100K to $10M. The wholesale value of the order stays yours. The advance is the production cost in the middle.
Many PO lenders pay the manufacturer directly, sometimes by letter of credit. With Bridge, funds go into your account so you can pay your own vendors and keep your manufacturer relationships. You stay the customer of record with your co-manufacturer.
When the retailer pays your invoice. Repayment follows the order cycle, with no daily or weekly debits. You can repay earlier to reduce the cost. The longer production and the retailer's payment terms run, the longer the financing is outstanding.
We tell you how payment is set up for that retailer before you close, so there is no surprise at delivery. Large retailers routinely work with suppliers who finance production. The arrangement does not change the order, the delivery window, or what you ship.
Yes. First orders are where the cash gap is largest, because the order is often bigger than anything the brand has produced before. Bridge funds first orders and store expansions for Walmart, Sam's Club and other national retailers.
PO financing pays for production before you ship. Factoring advances against an invoice after you ship. If you can already afford to produce the order and only need to wait less for the retailer to pay, factoring or an early-pay program may be enough.
The financing is repaid from what the retailer actually pays, so deductions reduce your margin, and a longer payment cycle adds cost. Model deductions and realistic payment timing before you size the financing. A missed delivery window can create the same gap.
Often, yes. Your existing lender may hold a lien on inventory and receivables, so the PO lender needs an agreement with them covering the financed order. Bring your current debt details to the first conversation so the order can be structured around that lien.
It is short-term debt tied to a specific order. It does not take equity, so ownership stays with the founders and investors who already own the business. You repay from the retailer's payment, not by selling a share of the company.
Get started
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All financing is subject to application, credit review, and underwriting.
