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Enter what the stock costs, its margin, how fast it sells and what the financing costs. See the profit left after financing, the break-even sell-through and whether sales cash arrives before the payments do.
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Updated October 13, 2026 · Merchant Fund Express
Illustrative arithmetic only. This is not an offer or a quote; real terms depend on your file and the funder.
Assumptions: sales arrive evenly across the sell-through weeks; stock you do not sell is not counted as profit (it stays on the shelf at cost); margin is capped at 99% and blank fields count as 0. If your offer quotes a factor rate, the financing cost is the funded amount times (factor rate minus 1).
A store wants $40,000 of holiday stock with a 40% gross margin, expects to sell 90% of it at full margin within 12 weeks, and is looking at funding that costs $6,000 over a 16-week term.
| Line | Math | Result |
|---|---|---|
| Full retail value | $40,000 / 0.60 | $66,667 |
| Expected sales (90%) | $66,667 x 0.90 | $60,000 |
| Incremental gross profit | $60,000 x 0.40 | $24,000 |
| Financing cost | $6,000 | |
| Left after financing | $24,000 - $6,000 | $18,000 |
| Break-even sell-through | $6,000 / $26,667 | 22.5% of the order |
| Sales cash by week 16 | $5,000 x 12 weeks | $60,000 vs $46,000 owed |
The order pays for its money once about 22.5% of it sells, around week 3 at this pace. Sales cash of $5,000 a week covers the $46,000 owed by about week 9.2. If the same stock took 30 weeks to sell, gross profit would be unchanged, but only $32,000 of sales cash would arrive by week 16, and the remaining payments would come from other money.
All figures in worked examples are illustrations of the arithmetic, not offers or quotes. Real terms depend on your file and the funder.
It fits a business buying stock it has sold before, at a margin it knows, for a season or a supplier discount it can date. Retail, wholesale, restaurants and auto parts are typical. It is a poor fit for untested product lines: if you cannot estimate sell-through from past sales, the break-even is a guess. In that case buy a smaller first order with cash, or ask the supplier for net-30 or net-60 terms, which can cost less than any financing.
Watch the speed mismatch. A daily or weekly payment starts right away, while slow-moving stock pays back over months. When the sell-through is longer than the term, the payment lands on the rest of the business. Run it through the MCA cash flow stress test or the payment burden calculator. For background on structures, read how inventory financing works and the inventory financing guide.
Requests start at $25,000, and a FICO of 500+ is considered. Tier rules are on the funding requirements page.
If the order covers its financing cost and the cash timing holds, check what you qualify for; the application takes about 5 minutes and starts with a soft credit pull. To compare two offers for the same order, use the offer comparison calculator.
No. A 100% markup is a 50% gross margin. Margin is gross profit divided by the selling price; enter margin here.
It is still inventory at cost, not profit. Counting it would make the order look like it pays for itself before the cash exists. You can sell it later; it just does not help this repayment.
Run it twice: once at full margin with a lower share sold, and once at the discounted margin. Use the weaker result.
No. Subtract them from your margin, or add them to the financing cost if they come with the order.
There is no fixed rule. The further break-even sits below the share you expect to sell, the more a slow season can miss before the order loses money.
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