why do businesses use inventory financing 
inventory financing is a form of short term borrowing companies tend to use it as a way to pay their suppliers before selling their products it is often used by small or mid sized businesses that may not be established or have a credit history it also allows these businesses to access financing without having to put up their business or personal assets for collateral the bottom linebusinesses need cash in order to fund their day to day operations and they have several options in order to secure financing inventory financing is just one way companies can get cash using the products or inventory they intend to sell as collateral while it can provide a quick injection of cash borrowers should be weary of the costs and risks associated with inventory financing 