Bakeries
A grocery or café group pays on net-30, but flour, butter and the night shift are due every week. Here is the per-week margin, the dated gap, and how an advance and invoice factoring compare.
✓ Checking what you qualify for does not affect your credit score.
Updated October 13, 2026 · Merchant Fund Express
A wholesale account is worth funding when the price clears your full cost with room to spare and the buyer pays on time. The gap is predictable: about five to six weeks of ingredients, labor and delivery before the first payment arrives. A modest revenue-based advance can bridge it if the weekly payment fits after receipts begin. Invoice factoring on the buyer’s invoices is often cheaper because it grows with the account and costs nothing when you stop.
A retail bakery, 3 years open, about $48,000 a month in deposits, a 625 FICO. A regional grocer orders 3,000 units a week, loaves and pastries, at an average of $2.40, paid net-30 from each weekly invoice.
| Line | Amount |
|---|---|
| Weekly invoice | $7,200 |
| Ingredients and packaging (32%) | −$2,304 |
| Second-shift baker and helper | −$1,450 |
| Delivery van, driver hours and fuel | −$450 |
| Weekly contribution | $2,996 |
One-time start-up costs: proofing racks, branded packaging and labels, $8,000. Six weeks of costs before the first payment ($4,204 a week) plus start-up is about $33,200, so the request is $35,000.
$35,000 at an assumed factor of 1.30, so $45,500 repaid, with an assumed $1,050 fee. Net proceeds $33,950, funded Monday, November 2, 2026. Then 26 weekly payments of $1,750 from November 9, 2026 to May 3, 2027. First delivery and invoice: November 9. The grocer pays each invoice 30 days later.
| Date | Event | Wholesale cash | Account balance |
|---|---|---|---|
| Mon, Nov 2 | Funded, start-up costs paid | +$33,950 − $8,000 | $25,950 |
| Week of Nov 9 | Costs and payment | −$5,954 | $19,996 |
| Week of Nov 16 | Costs and payment | −$5,954 | $14,042 |
| Week of Nov 23 | Costs and payment | −$5,954 | $8,088 |
| Week of Nov 30 | Costs and payment | −$5,954 | $2,134 |
| Week of Dec 7 | Nov 9 invoice paid Dec 9 | +$7,200 − $5,954 | $3,380 |
| Each week after | Invoice in, costs and payment out | +$1,246 | Rising |
The low point is about $2,100 at the start of December, so the retail side must be steady through November. Cost of the money: $45,500 repaid for $33,950 received, $11,550. Over the same 26 weeks the account contributes about $77,900, so the funding costs roughly 15% of what the account earns in that period. After May 3 the full $2,996 a week stays with the bakery.
All figures in worked examples are illustrations of the arithmetic, not offers or quotes. Real terms depend on your file and the funder.
Assume a factor advances 85% of each invoice on delivery and charges 2.5% per 30 days. On a $7,200 invoice you receive $6,120 at once and the rest, less a $180 fee, when the grocer pays. Over 26 weeks the fees are about $4,680. The trade-offs: the buyer pays the factor’s account, your contract must allow that, and it only covers invoiced sales, not the start-up costs. Some bakeries use a small advance for start-up and factoring for the running invoices.
Related: bakery big-contract funding, the bakery cash flow guide and what net-30 means. When the margin holds, check what you qualify for with a soft pull.
Size the gap as weeks of cost until the first payment plus start-up, then compare a small advance with invoice factoring on the buyer’s invoices.
It can be when the buyer is a creditworthy grocer or café group paying on terms. It scales with the account and stops when you stop, but the buyer pays the factor’s account.
If your full cost per unit, including labor and delivery, is above about 85% of the wholesale price, a small disruption can make the account lose money.
The revenue-based tier reads 600 and above, with 6+ months open and $60,000 in verifiable revenue. 500 is the minimum we consider.
Yes. Funding starts at $25,000, so a very small wholesale gap is usually better covered from cash or supplier terms.
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