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How to Finance Your Growing Amazon Business

Check out these financing solutions to help keep your Amazon growth momentum going, expand your product line, and avoid stockouts. By Kevin Weeks August 7, 2017
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About the Author

Kevin is the Senior Director of Partnerships at Payability. Prior to that, Kevin was a partner at a digital marketing agency called Dozen Digital, and held various roles in venture capital, private equity and investment banking. Kevin is a supporter of Defy Ventures, an entrepreneurship training program for formerly incarcerated adults.

You know your Amazon storefront is growing if it seems like inventory is flying off your shelves. It’s an exciting problem to have, but one that is difficult to manage. After all, if you run out of inventory, you risk losing sales, the Buy Box, and your Amazon sales rank.

So how are you supposed to scale when Amazon holds your income for two weeks?

To keep your growth momentum going, you may need a financing solution to bridge the two-week gap, so you can avoid an Amazon stockout — and possibly even expand your product line.

Financing Options

When it comes to financing your storefront’s growth, there is no one-size-fits-all solution. In fact, there are a variety of options depending on the specific needs of your Amazon business. Here is a look at some of the most common:

Personal Savings & Credit

Most startups and early stage Amazon sellers rely on their personal savings or personal credit cards to buy inventory and scale. In either case, you have immediate access to cash and, assuming you pay your credit card balance in full and on time each month, the cost of funds is free (and you could cash in on your credit card rewards points in the process).

That said, there are limits — literally. Your savings and credit limit will only get you so far. And if you miss a credit card payment, your personal credit score will take a hit. Moreover, using your personal credit for business expenses could make it difficult for you to get actual business financing in the future.

Crowdfunding or Friends & Family

Asking others to help fund your growth is another common practice among young businesses. You can do this with a crowdfunding site like Kickstarter or Indiegogo, or ask a family member or close friend for an investment. Depending on the route you take here, the cost of funds could be nothing, or you could “pay” by giving equity to your donor(s).

While you get to avoid paying interest rates, funds are not always guaranteed. Most crowdfunding sites will only disburse your funds if you raise a certain amount of money, and your friend or family member may not feel comfortable giving you a loan (after all, mixing business with pleasure can be risky).

Traditional Bank Loans & Lines of Credit

Well-established businesses often look to their bank for financing — be it a term loan (one lump-sum of cash) or a line of credit (a revolving pool of funds to access as you need).

Banks offer low interest rates, but the process is very long and arduous, requiring endless amounts of paperwork (everything from business plans to bank statements to tax returns) and time (often more time than you’re already waiting for your Amazon payments).

Alternative Financing

Over the last decade, several alternative financing companies have emerged to make it easier for businesses to get growth capital. These online lenders promise seamless application processes with minimal to no paperwork and fast funding.

The premium-level service they provide, however, comes with a price: high interest rates, short payment terms, and daily or weekly payments auto-deducted from your business bank account.

Amazon-Specific Funding

Just as online lenders have emerged to serve small businesses, so too have funding sources come about designed specifically for Amazon sellers. The eCommerce giant offers loans on an “invite-only” basis to qualifying businesses through Amazon Lending. If you quality for an Amazon loan, you’ll see an offer in Seller Central.

Another offer you might see there is for Payability, which advances payments for Amazon sellers — instead of waiting two weeks for your Amazon income, you can access it one business day after making a sale. Think of it as modern-day invoice factoring where no loan or credit card is involved, just a small flat fee.

Lastly, you can always try to negotiate your payment terms with your suppliers and vendors to free up some cash flow. For example, if you have a good track record with wholesalers, you may be able to get net 60 day payment terms instead of the typical net 30.

Whew — as you can see, there are several different financing options to help you invest in growth, buy more inventory, and maintain ownership of the coveted Buy Box. If you’re still not sure which one is right for you, take this Fundability Quiz to help narrow your search.

And if you’re interested in learning more about how Payability could help your business grow, visit

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