selling PPE

Selling PPE? Follow these steps to secure funding

What a time to be in this business. Whether you were already selling PPE in the past or not, you may have found that you’ve somehow fallen into the space.

selling PPE


Orders are flying fast and furious for face masks, shields, gowns, gloves and that ever-critical hand sanitizer! From cities and government offices to private companies and industry organizations  — everyone is placing an order.

You may have all the supplier and trade connections to secure PPE inventory, but not enough working capital to close the deals. So how do you make sure you can deliver — especially if you’re presented with a surprise PO?

Here are six tips to help you access funds:


fake deal

Tip 1: Make sure the deal is legitimate!

There are a lot of fake deals and scammers out there, especially when selling PPE. Nefarious people are quick to take advantage of an industry in hot demand, so do your due diligence to ensure whoever you’re talking to has a credible business. Get professional help at this step, and ask your lawyer, banker, collection firm or other partners to do required background checks and extra investigation.


funding options

Tip 2: Investigate your funding options

You likely already have a banker on your side, and that can often be step one. But if you have a maxed-out line of credit, or a loan that can’t be extended, how will you get more funds released to make a new deal go through? Check out your options such as government programs (many are listed here), the CDFI Fund, community lenders and alternative lenders such as us here at Liquid Capital. We are happy to work alongside your banker.


funding partners

Tip 3: Connect your banker and your alternative lender

This step will benefit you greatly, for two main reasons…

1) It tells you that both your banker and your alternative lender are the trustworthy partners you need right now. They’ll be working together, in partnership, to help your business get the much-needed access to cash — as quickly as possible. If they aren’t willing to work together, you’ve got the wrong people on your side.

2) It gets you out of the weeds. You’ll have a lot more to focus on to close a PPE deal quickly, so having to be involved in the nitty-gritty of every aspect of financing decisions between the banker and lender would take up a lot of your time. Meet with them regularly, of course, but make sure they connect even more often to power through the details.



Tip 4: Get clever about order on receivables

When you’re dealing with large financing deals and multiple partners, you’ll no doubt hear about the order in which your lender and banker will need to be placed on your receivables — also known as the subordination agreement. This might not be your decision ultimately, but don’t let this be a deal-breaker.

While your original financing partner may have first position, a new lender may also require they take this top spot. Someone’s got to give, but there are different ways of structuring deals, and you could suggest a split in the territory or some other method of segmenting the positions. For example, a second lender may be able to only take first position in one State, while the original lender retains first position across the rest of the globe.


Related: Learn how to become lender friendly and why you should perform a UCC search on your own company.


speed red flag

Tip 5: Speed is important, but too fast could be a red flag.

If you’re supplying PPE, your client likely wants their shipment yesterday. That will put some major urgency on your financing. If you’re structuring a PO financing or invoice factoring deal, for example, these can be done relatively quickly — but it will save you time, money and headaches in the long run if you go through the proper steps. If a lender promises they can rush this beyond a believable timeframe, be wary. You don’t want to get into a situation where you actually end up owing on payday loans or merchant cash advances — with enormously high rates.



Tip 6: Line up an expert now, even before you have a deal

You might not yet have a PO, but the moment you do, you’ll want to have a trusted partner on stand by. If you’re currently selling PPE (or could be) — or your company does business for any essential service — start talking to new lenders now. Find out what solutions they offer, how they can structure deals, what other industries they work with, and their history of funding businesses like yours. Short-list the ones you think could help you, and you’ll be that much more prepared when a new client comes knocking on your door with the next big order.


Next up: How asset-based lending works


About Liquid Capital

At Liquid Capital, we work with clients who are selling PPE and those in other essential service industries — supply chains, food services, financial services, manufacturing, transportation services, construction, and resources and energy. Whether you’re currently operating from a virtual home office, or you’ve shifted back to the busy downtown hustle and bustle, we know business can’t stop. We’re business people ourselves, and our company is built on a network of locally owned and operated Principal offices. Whenever you’re talking to Liquid Capital, you’re talking directly to your funding source and a fellow business person.

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