Business

How to Easily Access Capital As a Produce Distributor

No matter the industry or the size of the business, growth relies heavily on capital. If you want your produce business to grow, you’ll need capital. 

But sometimes, accessing this much-needed capital can be challenging. Thankfully, this doesn’t always have to be the case. With financial solutions and capital offerings that come along with ERP systems, it’s possible to get the capital your produce business needs to get it to where you want it to be.

Most times, you’ll need to get what you need when you need it, without having to go through the stress of paperwork. Unfortunately, this isn’t always the case with most financing solutions, and there are several challenges that many businesses face. 

In this article, we’ll be providing you with solutions to these challenges to help you access capital easier. Before we discuss the solutions, however, it’s essential to first identify the challenges you’re likely to face as a produce distributor seeking capital.

Challenges fresh produce distributors face in sourcing capital

Below are the major problems distributors face in the fresh produce industry.

  1. Slow processing

Sometimes, the problem isn’t getting the capital you need, as there are quite a few platforms willing to offer it. Rather, the real issue is getting the capital on time. 

In fact, this is one of the most common issues with accessibility, and it’s a challenge experienced in more than just the fresh produce industry. Capital is only useful as long as it’s available when needed.

Unfortunately, many financial solutions out there fall in this category. While they offer capital to fresh produce businesses, processing takes so much time that it’s almost not worth it.

  1. Excessive charges

It’s a fact that no capital offering service functions without some form of extra charges. These charges are essential to keeping the business running—that being said, some platforms charge more than others, and some charge a little too much. This can often be a problem, sometimes going as far as leaving distributors feeling cheated.

And even worse, not only can these charges be excessive, but they can also not be obvious from the start. These hidden charges quickly become a problem when distributors end up getting much less than they were supposed to, or they have to pay much more than initially bargained for.

  1. Strict loan terms and conditions 

Every business has specific terms and conditions that need to be met for deals to be conducted successfully, and financial solution services are no exception. These terms and conditions can often become a problem when you need to access capital though.

One of the biggest problems fresh produce distributors face here is the rigidity of the terms from financial services. With many of these terms not being favorable to fresh produce businesses and most of these platforms being inflexible, this often poses a challenge to distributors who have to choose between taking capital offerings that aren’t really favorable and facing the risk of not finding a better offer on time.

  1. Lack of industry-specific platforms

Arguably, the biggest challenge fresh produce distributors face when it comes to accessing capital to scale their business is the lack of adequate industry-specific capital offering platforms. It’s a challenge with far-reaching consequences.

It’s much harder to access capital from a non-industry-specific platform than it is from an industry-specific one. And every challenge becomes even harder with non-industry-specific platforms—processing takes even longer, charges become even more expensive (since they don’t offer as many discounts as industry-specific platforms do), and their terms are nowhere near as accommodating.

How to easily access capital as a fresh produce distributor

Now that we’ve pointed out the major challenges you’re likely to experience when trying to access capital as a fresh produce distributor, how exactly can you sidestep all these potential pitfalls and easily get the capital you need to take your fresh produce business to the next level?

Well, the last point gives some insight into the answer. It’s straightforward: invest in an industry-specific financial solution that provides capital offering services. 

For example, Silo is an ERP system that also offers financing and capital offering solutions. Designed specifically for the fresh produce industry, these software solutions are essentially built to offer fresh produce distributors like you streamlined solutions to all the industry-specific problems you might experience.

However, there are a few things to keep in mind as well. It’s important to take into account how well these platforms handle the challenges listed above. Ask yourself these questions:

  • How well do they process offers? 
  • Do they offer cash flow acceleration or instant pay features? 
  • If you needed capital urgently, would you be able to get it on time?
  • What are their charges like; are they favorable? Are there any hidden charges? Is the cost worth it?
  • What are their terms and conditions like? Do they fit your business’s specific needs perfectly? Are they beneficial to your needs and purposes or can you find better offers somewhere else? Are they flexible enough to account for any unique needs you might have?

If the answers to the questions above are positive, then yes, that capital offering service is perfect for you and would likely be the easiest way for you to access the capital you need for your produce business.

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