Stock and inventory finance for orders that come before the sales

Retail and wholesale run on a simple, uncomfortable truth: you pay for stock long before customers pay you for it. Christmas stock lands in September. Summer ranges arrive in winter. An import order needs a deposit months before the container docks. Stock and inventory finance pays for the goods now and gets repaid as they sell.

Who uses stock finance?

• Retailers building up for Christmas, back-to-school, summer or EOFY sales.
• Wholesalers and distributors taking larger orders to win better pricing.
• Online sellers scaling up a best-seller before it sells out.
• Importers paying deposits, freight, duty and GST before goods arrive.
• Trades and manufacturers buying materials in bulk when prices are good.

What makes a stock purchase worth financing?

Three things need to line up:

1. Sell-through. You can say roughly when the stock will sell, based on past seasons.
2. Margin. The profit on the stock comfortably covers the finance cost.
3. A plan B. A clearance route for lines that don’t move.

Scenario	Usually worth financing?
Christmas stock based on last year’s sales	Yes, if it clears by January
Bulk discount on a fast-moving line	Yes, if the discount beats the finance cost
Doubling an order on a new, untested product	Risky: start smaller
Stock to fill a bigger shop that isn’t busier yet	Usually not

How should stock be funded?

• One big seasonal buy: a short unsecured loan or a working capital loan repaid as the season’s sales come in.
• Regular restocking all year: a line of credit you draw and repay as stock turns over.
• Stock as part of buying a business: usually funded at settlement; see buying a business.

Avoid long terms for stock. You don’t want to still be paying for last Christmas’s stock next Christmas.

What does an import order really cost?

The supplier invoice is only part of it. A full landed cost usually includes:

• Supplier deposit, often well before production.
• Balance before shipping.
• International freight and insurance.
• Customs duty, where it applies, and GST on import.
• Customs broker, port and clearance charges.
• Local delivery to your warehouse.

Funding only the supplier invoice and paying the rest from cash flow is a common way importers get caught short.

Illustrative example. A Perth outdoor-gear online store sells about $95,000 a month, peaking in spring and summer. For the season it orders camping equipment from an overseas supplier, with a landed cost of about $160,000 including freight, duty and GST. Last season’s numbers show it sold through in about four months. A short-term loan drawn in stages for the deposit, balance and landed costs, repaid from spring sales, keeps the store from emptying its account before the peak.

How do you keep stock finance under control?

• Order based on last year’s actual sales, adjusted modestly for growth.
• Track sell-through weekly and act early on slow lines.
• Repay from sales as they come in rather than waiting for the due date.
• Use the purchase payback calculator to test whether a bulk discount is really a saving.

How do you know how much stock to buy?

Over-ordering is the most common way stock finance goes wrong. Before you place a big order:

1. Start with last year’s sales for the same period, by product line.
2. Adjust for what’s changed: new products, a new location, a competitor closing or opening.
3. Check your sell-through rate: how quickly each line actually moved last season.
4. Allow for lead times, so you don’t run out mid-season with no way to reorder.
5. Plan the clearance: what you’ll do with what’s left, and at what price.

Many businesses order core lines confidently and take smaller positions in new or untested products. That way a slow new line doesn’t sink the season.

If you sell online, look at your sales platform data for search trends and conversion by product. It’s often a better guide than gut feel. And keep an eye on the cash side: the goal is stock that turns into cash fast enough to repay the funding before the next season’s order lands.

Got an order to place?

If the sales are coming and the stock is the bottleneck, let’s fund it. Enquiring with us doesn’t involve a credit check; that only comes up once you decide to go ahead. We won’t spray your details across a list of lenders. A real person looks at the order, your sales history and timing, and calls you with options.

Please be accurate on the form about the order size, your monthly turnover and when you expect to sell through. It gets you the right option first time. Start your stock finance enquiry.