How to Finance your Holiday Inventory on Amazon

Amazon Inventory Financing

Fall is in the air and the holiday shopping season is just around the corner. Whether your Amazon business is retail arbitrage, private label or a separate category altogether, chances are you’re looking for ways to fund the extra inventory you’ll need in Q4.

The holiday shopping season often starts as early as November 1st and continues well into January as customers spend the cash and Amazon gift cards they received as holiday gifts. Therefore, sellers need to stock up on inventory in September and October in order to maximize their sales, optimize their search rank and avoid stockouts throughout the entire holiday shopping season.

amazon inventory financing

Financing inventory can be nerve-wracking even for top Amazon sellers. It can be especially tense during Q4 when the stakes and stock quantities are highest. If you’re not exactly sure how you’re going to fund your holiday inventory this season, don’t panic. Take some time to explore your options and make an educated decision. With the right financing strategy you can exceed your Q4 sales goals and set yourself up for a prosperous New Year!

Amazon inventory financing options:
  1. Savings

Personal savings is a fast and interest-free way to fund your next purchase order or store visit. If you have enough money in the bank to pay for inventory, you can avoid maxing out credit cards or applying for loans. However, if you run out of savings, you won’t have extra money to cover emergency expenses or fund additional inventory if items sell faster than expected. While savings is a relatively safe option, you won’t be able to rely on it later once it’s gone and it may not cover all of the inventory you need. Despite the interest-free aspect, using savings to fund inventory still carries a significant amount of risk and limitations.

  1. Credit Cards

If you just started selling on Amazon, credit cards can be an easy way to finance your inventory. However, as you grow, your restocking needs may outgrow your credit limit and you could miss out on profitable opportunities to stock up on low-cost inventory and resell it at a high margin. This can hinder growth and deter otherwise savvy sellers from reaching their full potential.

On the other hand, if your business slows down and you don’t have the cash flow to pay off your balance, your credit score could take a hit, you may end up paying more interest than you originally planned and it could be more difficult to access credit in the future. While convenient, credit cards can be a challenging way to finance Amazon inventory as they lack the ability to scale at the speed of your business.

  1. Traditional Loans and Alternative Financing

Banks offer term loans and lines of credit at relatively low interest rates. However, the approval process is complex and time consuming. Small businesses have low approval rates. Therefore, a traditional bank loan may only be an option if you’re an established Amazon seller or have other sources of income associated with your business. Due to the complex review process, you may not get the funding on time if you are approved for a traditional loan. This lengthy approval process also prevents sellers from stocking up on inventory when the price is lowest and the margins are highest. If you’re looking to grow your Amazon business quickly, you can’t afford to miss out on these valuable windows of opportunity.

Alternative or online lenders have higher approval rates and better approval processes. But, you need to read the fine print. Since the turnaround is faster and the approval rates are higher, the terms tend to be unfavorable. Like credit cards, both traditional and alternative loans can inhibit growth since they don’t fluctuate with the ups and downs of an Amazon seller’s business. Once you’ve reached your credit limit, you’ll need to find other financing options in order to optimize your inventory and keep up with demand. Plus, the more debt you take on, the more you put your personal and/or business’ credit at risk.

  1. Amazon Lending

Amazon offers loans to qualified marketplace sellers. However, sellers can not apply for or predict when they will receive an Amazon loan. In the event of a loan offer, Amazon will notify the seller in their Seller Central dashboard with a one-time, “all or nothing” offer. If you do decide to take Amazon up on their loan offer, they will take the interest and repayments directly out of your earnings.

  1. Payability

amazon inventory financing Does waiting two weeks to receive payments from Amazon prevent you from filling inventory or taking your business to the next level? Payability allows you to bypass Amazon’s net 14 terms and get paid today for the sales you made yesterday. For a 2% flat-rate fee Payability will forward you 80% of your Amazon earnings on a daily basis. The remaining 20% will stay in a reserve to cover returns and will be deposited into your account on the regular bi-weekly schedule. There are no sign-up fees or cancellation fees.

Instead of funding inventory with high interest loans or cleaning out your savings to remain in the Buy Box, Payability allows you to fund your Amazon business with your own liquid money. By advancing your Amazon earnings, you can scale your business, pay off debt and fill inventory faster than the competition.

In the Amazon Marketplace, cash flow gives sellers a competitive edge.

Chances are you now have a better idea of how you plan to finance your holiday inventory and your inventory moving forward.

If you want to learn more about Payability and how it works, visit

This is a guest post from Victoria Sullivan at Payability. Payability is offering a $100 credit to new customers. Click here to get started.

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