Six structures cover almost every situation a product-based business runs into. They differ mainly in how fast they move, how much paperwork they take, and when the payments start relative to when the inventory sells.
The six structures
| Structure | Fits when | Trade-off |
|---|---|---|
| Short-term working capital | A closeout or bulk buy that turns over fast. | Shortest term, quickest to arrange, highest cost per dollar borrowed. |
| Line of credit | You buy opportunistically and repeatedly, not once. | Takes more to set up, then it is there when the next deal appears. |
| Line of credit to $350K | Larger recurring buying needs. | Same shape, larger ceiling, more review. |
| Equipment financing | Buying a machine, forklift, racking or fixtures, including at auction. | The equipment secures it; auction timelines are tight. |
| Term loan | A second location, a warehouse expansion, a planned build-out. | Longer review, longer term, lower payment. |
| Revenue-based financing | Seasonal sellers whose slow months would strain a fixed payment. | Payments move with sales, up as well as down. |
SBA loans belong in the comparison too. They are usually the cheapest long-term money and almost never fast enough for a deal that closes in days.
Match the payment to the sell-through
This is the part that decides whether funding helps or hurts. Ask when the first payment is due and compare that to when the goods will be on the shelf and moving. A daily payment that begins before a container clears customs is a cash problem regardless of how good the buy was.
What it costs to find out
Nothing. One online form, no obligation to accept an offer, and checking your options does not affect your personal credit score. See what gets reviewed before you apply.