When you’re running a smoke shop, CBD store, kratom bar, or other high-risk business, accessing fast and reliable funding can be the key to growth, or survival. But not all financing options are created equal, and picking the wrong one can hurt your cash flow more than help it.
At Green Financial Service, we specialize in business funding tailored for high-risk industries. In this post, we’ll break down the key differences between Purchase Order (PO) Financing, Accounts Receivable (AR) Financing, and Merchant Cash Advances (MCAs)—so you can choose the right tool for your specific business needs.
What is PO Financing
Purchase Order Financing is ideal for product-based businesses that receive large customer orders but don’t have the cash on hand to fulfill them.
💡 How It Works:
Let’s say your CBD store lands a big wholesale order, but you don’t have the cash to pay your supplier. With PO financing, we pay the supplier directly on your behalf. Once your customer pays you, the lender takes their cut, and you keep the rest.
Best For:
- Wholesale CBD and smoke shops
- Importers and distributors in the legal mushroom or kratom industries
- Companies fulfilling large retailer orders (like gas stations or ecommerce resellers)
Pros:
- No need to take on debt
- Based on your customer’s credit – not yours
- Enables you to scale without tying up working capital
Things to Know:
- Requires valid purchase orders from creditworthy buyers
- Usually only available for physical goods (not services)
What Is AR Financing (Accounts Receivable Factoring)?
AR Financing – also called invoice factoring – lets you turn outstanding invoices into immediate cash. Instead of waiting 30, 60, or 90 days to get paid, you get funded upfront.
💡 How It Works:
You submit your unpaid invoices to the lender. They advance you a percentage (usually 80–90%) right away. Once your customer pays, you receive the remaining amount minus a small fee.
Best For:
- B2B kratom and CBD suppliers
- Cannabis-related businesses that invoice dispensaries or licensed retailers
- Companies that have slow-paying but reliable clients
Pros:
- Smooths out cash flow gaps
- Based on the creditworthiness of your customers
- Grows as your sales grow
Things to Know:
- Not suitable for B2C or retail transactions
- May involve direct contact between the lender and your customer (in traditional factoring models)
What Is a Merchant Cash Advance (MCA)?
A Merchant Cash Advance is not a loan. It’s an advance against your future credit card or debit card sales. This is one of the few financing types available to retail and ecommerce businesses in high-risk industries.
💡 How It Works:
You receive a lump sum upfront, and then a percentage of your daily credit/debit card sales is automatically deducted to repay the advance – plus a fee.
Best For:
- Smoke shops and vape shops with steady card volume
- CBD retailers with seasonal cash flow dips
- Kratom bars and mushroom lounges looking to expand or cover short-term expenses
Pros:
- Fast approvals – even for low credit
- Payment adjusts based on your sales volume
- No fixed monthly payment
Things to Know:
- Can be more expensive than traditional financing
- Daily or weekly repayments can affect cash flow if sales slow down
Choosing the Right Option for Your Business
| Funding Type | Best For | Speed | Based On | Repayment Method |
|---|---|---|---|---|
| PO Financing | Wholesale product-based businesses | Fast (once approved) | Your customer’s credit | Customer pays invoice |
| AR Financing | B2B businesses with unpaid invoices | Fast | Your receivables | Customer pays lender |
| Merchant Cash Advance | Retail and ecommerce businesses | Very fast | Daily card sales | Daily/weekly % of sales |
How Green Financial Service Can Help
Most banks and mainstream lenders won’t work with high-risk industries like CBD, kratom, or smoke shops. But Green Financial Service has built strong relationships with specialized funding partners who understand your business and can approve funding when others can’t.
✅ We offer:
- PO Financing and AR Factoring for product-based companies
- MCA programs for retailers and ecommerce stores
- Personalized funding advice from high-risk specialists
- Near-instant decisions for many programs
Whether you’re fulfilling a large order, waiting on a big invoice, or need quick capital to keep things running smoothly, we’ll match you with the right solution, not just any solution.
Ready to Explore Your Options?
If you’re not sure which type of funding is right for your high-risk business, we can help. Schedule a free consultation with a Green Financial funding expert today, and we’ll walk you through your options with clarity and transparency.
