How does inventory financing differ from a bank line of credit?

Banks provide unsecured or lightly secured lines based on cash flow and credit. Inventory financing is asset-based, the lender's collateral is the inventory itself. This means companies with weaker credit profiles or high growth rates can access more capital than banks will offer, because the lender has a tangible asset to liquidate.

Can I combine inventory financing with receivables factoring?

Yes, this is the most common structure at $5M+ in working capital needs. An asset-based lender provides a single revolving facility secured by both receivables and inventory. Advance rates are set separately for each asset class. This gives you one relationship, one monthly report, and maximum borrowing capacity.

What monitoring does the lender require?

Monthly (or weekly for larger facilities) borrowing base certificates showing eligible receivables and inventory. Periodic field exams (1-2 per year) where the lender's auditor verifies inventory counts and valuations. Real-time access to your accounting system is common for $10M+ facilities.

What industries use inventory financing most?

Food and beverage distribution, consumer electronics, auto parts, building materials, medical supplies, industrial chemicals, clothing/apparel, and seasonal consumer products. Any industry with significant inventory investment and reliable sell-through qualifies.

Published: March 31, 2026·Last updated: May 16, 2026·By Ed Freeman, Capital Advisor. PeerSense

What is the best financing for b2b inventory at 50-85% (of eligible inventory) LTV?

Inventory financing provides revolving credit lines secured by your eligible inventory, raw materials, work-in-process, and finished goods. At $2M+ in inventory, advance rates range from 50-85% depending on inventory type, turnover rate, and liquidation value. Combined with receivables factoring, inventory financing creates a full working capital solution that scales with your business.

Published by PeerSense Capital Advisory · Written by Ed Freeman, Founder

Prime: 6.75% 10-Yr Treasury: 4.25% Est. Inventory Financing Range: Prime + 1.5% to Prime + 4%as of Mar 19, 2026

B2B Inventory

Inventory Financing, Revolving Capital for B2B, Wholesale & Distribution

Inventory financing and purchase order funding for B2B companies with $2M+ in inventory. 50-85% advance against eligible inventory. Manufacturing, wholesale, distribution, consumer products.

Minimum 30-35% equity required. B2B manufacturers, wholesalers, and distributors with $2M+ in eligible inventory.

Discuss Your B2B Inventory Deal Call (317) 452-6990

KEY TERMS

Deal Parameters at a Glance

LTV Target

50-85% (of eligible inventory)

Est. Rate Range

Prime + 1.5% to Prime + 4%

Term

12-month revolving (annual renewal)

Recourse

Full recourse

DSCR

1.0x minimum

Closing Speed

14-30 days

Min Loan Size

$2M

Loan Products

Inventory Financing, Asset-Based Lending

Indicative only, as of August 1, 2026. Not a quote, commitment or offer of credit. Final pricing, leverage and terms are determined by the lender at underwriting, after full transaction materials are reviewed. PeerSense does not lend and does not set pricing. What these terms mean.

FIT ASSESSMENT

When Is This the Right Fit?

Use this when your B2B company needs capital to purchase inventory, fund seasonal builds, or bridge the gap between inventory acquisition and receivables collection. Essential for wholesale distributors, manufacturers with long production cycles, and consumer products companies with seasonal demand. At $5M+ combined AR + inventory, asset-based lending may be more efficient than standalone inventory financing.

Want the full program overview, current rate sheet, and underwriting matrix? See the Lending Solutions guide →

ADVANTAGES

Key Benefits

Revolving line grows with your inventory, scale without renegotiating

50-85% advance rates on eligible inventory (finished goods receive highest advance)

Combine with receivables facility for full working capital solution

Fund purchase orders and seasonal inventory builds

No equity dilution, debt financing secured by the inventory itself

ALTERNATIVES

Strategic Alternatives

Large-Ticket B2B Factoring

If your primary need is faster collection on receivables, not inventory funding

Learn more

Asset-Based Lending

If you want a combined facility against receivables + inventory + equipment

Learn more

Equipment Financing

If your capital need is for production equipment, not inventory

Learn more

Frequently Asked Questions

Finished goods receive the highest advance rates (70-85%). Raw materials typically get 50-65%. Work-in-process is hardest to finance, some lenders exclude it, others advance 30-50%. Perishable, hazardous, or highly customized inventory may be excluded. The key factor is liquidation value, how quickly and at what discount could the lender sell the inventory.

See Related Rates by Program

PeerSense covers the full commercial capital stack. Indicative levels that lenders in our network have been pricing across these programs, as of August 1, 2026.

SBA 7(a) & 504

5.50–11.75%

Up to $5M acquisition / real estate / equipment, 10% down

See current rates

CMBS Conduit

5.60–7.10%

10-yr non-recourse fixed, $5M–$500M+, fully assumable

See current rates

Bridge Loans

9.00–14.00%

12–36 mo transitional, SOFR + 470-970 bps, 65-75% LTV

See current rates

DSCR Investor

5.95–8.50%

30-yr fixed rental, qualifies on property cash flow

See current rates

Equipment Financing

5.50–12.00%

Loan, lease, SBA 504, vendor, captive. Section 179 eligible

See current rates

Hotel Financing

5.85–11.75%

CMBS + SBA 504 + bridge + PIP across all flags

See current rates

Private Credit

7.80–18.00%

Non-bank flexibility, unitranche, recap, transitional

See current rates

Invoice Factoring + ABL

0.5–3.5% / 30d

B2B receivables, trucking / staffing / construction / govt

See current rates

No-Doc CRE

7.50–11.50%

Limited-doc commercial, asset-based underwriting

See current rates

Connect with PeerSense, Direct Capital Advisory

PeerSense pre-underwrites every deal before presenting it to our institutional capital sources. With a curated network of lender relationships and live market rate intelligence, we match your b2b inventory deal with the right capital source, right now.

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Fee at closing only · Complimentary initial consultation

Published by PeerSense Capital Advisory · Written by Ed Freeman, Founder. Updated March 2026.

Disclaimer: The information on this page is provided for educational purposes only and does not constitute financial, legal, or investment advice. Rates, terms, and availability are subject to change based on market conditions, property characteristics, and borrower qualifications. The rate ranges cited reflect approximate market pricing as of March 2026 and may not reflect current conditions at the time of reading. PeerSense is a capital advisory firm, not a lender. We do not originate, fund, or service loans. All financing is provided by third-party lenders subject to their own underwriting criteria and approval processes. Borrowers should consult with qualified financial and legal professionals before making any financing decisions.