Invoice finance for logistics and distribution businesses
Warehousing, fulfilment and distribution businesses incur costs before monthly customer accounts are settled. Invoice finance may turn qualifying service balances into earlier working capital.
Positive Funding Limited is a finance broker. Funding is subject to provider assessment and agreed terms.
Volume can rise before cash catches up
A new fulfilment contract can increase staffing and handling costs immediately. Storage and distribution charges may not be paid until after a monthly billing and approval cycle.
Measure the gap using completed chargeable activity. Future stock movements and anticipated volumes do not yet create the customer debts on which invoice funding normally depends.
Support handling capacity
Consider whether approved service debts can contribute to staffing and operating commitments.
Explain complex billing
Separate storage, pick-and-pack and distribution charges so the funded amount is clear.
Watch customer limits
A fast-growing account can use up buyer headroom even before your overall limit is reached.
Funding completed logistics services
Build a supported invoice
Match the bill to warehouse activity, dispatch records and the agreed tariff. Record any queried charges separately.
Confirm approved availability
The provider checks the customer and debt before calculating an advance. Forecast receipts are not a substitute for approved invoices.
Settle against the remittance
Customer receipts are allocated under the facility. Reconcile claims and credits before treating the retained balance as available cash.
Claims and service credits can reduce the receivable
Lost stock, picking errors or performance credits may affect payment under a logistics contract. Explain any right to offset claims against service bills. Also identify the legal customer where a platform, retailer or intermediary is involved.
Decide how much collection support you need
Invoice factoring
Factoring may help follow up numerous trade accounts. Agree how the provider separates routine payment chasing from operational disputes.
Invoice discounting
Discounting can leave customer communication with an established finance team. You still need timely reporting of receipts, credits and overdue balances.
Selective invoice finance
A single large distribution customer may justify asking about selective funding. Compare the customer limit with expected peak balances rather than only today’s invoice.
Compare factoring and invoice discounting before choosing who manages collections.
Illustration: monthly fulfilment charges
Assume £64,000 of completed fulfilment services qualifies for an 85% advance. That is £54,400 initially, with £9,600 before fees left for later settlement. Unapproved charges would not be included in this assumption.
The calculation is hypothetical; actual eligibility and deductions are set by the provider.
Model peak and normal trading months
Ask for fees based on invoice volume, customer payment history and anticipated use. Include administration, funding charges and minimum fees when throughput falls. Compare costs using the same assumptions across proposals; see our invoice finance pricing guide.
Information that makes the discussion useful
Prepare customer contracts, tariff schedules, activity evidence and an aged debtor report. Explain claims history, seasonal volume changes and existing finance. A short cash forecast showing wage and supplier dates helps establish the amount required.
Logistics funding questions
Can storage charges be financed?
Completed, contractually payable storage services may be considered. Explain the billing period and whether the customer can dispute or offset the charge.
Does stock held for customers form part of the facility?
Not simply because it is in your warehouse. An invoice facility assesses your receivables, not ownership of goods you are storing for another business.
What happens if a customer claims for missing stock?
Tell the provider whether the claim affects payment of its invoices. A disputed or reduced debt can lower the funding available.
Can funding grow with a new contract?
Potentially as eligible invoices build, but facility and customer limits still apply. Review capacity before committing to increased delivery costs.
Review your logistics payment cycle
Tell Positive Funding which services you bill, how long approvals take and when operating costs must be paid. We can discuss whether your completed-service ledger provides a suitable basis for funding.
Funding is subject to eligibility and provider agreement. Fees, guarantees and security requirements vary. Explore other business sectors.