What purchase order financing costs
Directional ranges, published so you can check what you hear elsewhere. No teaser rates. Anyone promising a specific number before seeing your file is guessing.
Current directional ranges
| Measure | Typical range | Notes |
|---|---|---|
| Funding amount | Up to 100% of verified supplier cost | Finished goods fund highest. Material-only builds fund partially. |
| Fee | 2% to 6% per 30 days outstanding | Charged on funds employed, from disbursement to takeout. |
| Minimum gross margin | 20% to 30% | Below 20% the financing cost usually kills the deal. |
| Transaction size | $50K to $10M+ | Under $50K the fixed diligence cost dominates the rate. |
| Speed to first funding | 2 to 4 weeks | Repeat orders on a live facility fund far faster. |
These are directional ranges, not offers. Your actual terms depend on your buyer, your supplier, your margin, your revenue, and your industry.
8 variables that set your number
Buyer credit quality
The largest lever. Investment-grade and government buyers earn the best pricing and the highest funding percentage.
Gross margin on the order
Below roughly 20% most funders decline. At 30% or better the deal absorbs the cost comfortably and prices better.
Cycle time
Fees accrue per 30 days outstanding. A 45-day order costs roughly half of a 90-day order at the same rate.
Supplier profile
An established domestic supplier who accepts a letter of credit prices better than an unproven overseas source.
Labor share of cost
Purchased material and finished goods fund cleanly. Heavy in-house labor is often funded only in part.
Transaction size
Small orders carry fixed diligence costs that show up as a higher effective rate. Larger orders amortize them.
Repeat volume
A second and third order on the same buyer and supplier reprice down because the verification work is already done.
Paired takeout
A committed factoring line for the resulting invoice shortens exposure and usually reduces the PO fee.
Ask for the whole fee schedule
The headline rate is rarely the whole cost. Before signing, get written answers on diligence and setup fees, letter of credit issuance and amendment charges, inspection costs, wire fees per disbursement, minimum fees per transaction, and what happens to pricing if the buyer pays late. We review the schedule with you at no charge.
Manufactor Finance is an independent commercial finance broker. We do not lend, bank, or invest, and we charge no application, origination, or closing fees.
Cost questions
Directionally 2% to 6% per 30 days on the amount advanced, with funding up to 100% of verified supplier cost. Strong buyer credit, healthy margin, short cycle times, and repeat volume push you to the low end. First transactions, thin margin, and long builds push you to the high end.
The funder is exposed before the goods exist. There is no receivable yet, no proof of delivery, and real performance risk that the order is never completed to spec. Factoring prices lower because it buys an invoice for goods already delivered and accepted.
Depending on the institution: a due diligence or transaction setup fee, letter of credit issuance and amendment fees, wire fees, inspection or third-party verification costs, and UCC filing costs. Ask for the full schedule in writing. We review it with you before you sign.
Shorten the cycle. Negotiate faster supplier lead times, ship complete rather than in partials, invoice the same day you deliver, and pair the facility with factoring so the takeout happens immediately instead of waiting out net-60. Cost accrues by time, so days are the lever.
No. These ranges are published so you can sanity-check what you hear elsewhere. Your actual pricing is set by the funding institution during underwriting. Anyone promising a specific number before seeing your file is guessing.
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