It appears businesses are increasingly looking for additional means of funding working capital other than the their bank overdraft. Stocking finance is a viable addition to taditional cash flow finance facilities. Stocking finance is usually provided in conjunction with a factoring or invoice discounting facility. Not all factoring or invoice discounting companies povide a true stocking facility. All say they do but most only provide funds against stock to provide an over advance of equal to and no more than the total debtor book. Furthermore they wil reduce the advance over an agreed period back to the agreed payment of the debtor book. IE 85-90%. There are only a handful of true revolving stock facilities where an agreeed percentage of the stock is permanently advanced on a revolving credit basis. Remember this facility must be used in conjunction with the factoring or invoice discounting facility.
Tags: cash flow finance
