Vendors have a vested interest in the success of their clients and thus are likely to be supportive or understanding of clients' financial needs. This aspect of the vendor/client business relationship positions vendors in unique positions to assist with financing business cash-flow and working capital needs.

Since vendors are also suppliers of wholesale products and in some cases are also franchise shareholders of businesses, there may be several ways by which they may be able to help finance a business. The following illustrates types of client/vendor relationships, how those relationships can influence financing and the various methods of financing assistance vendors can provide.

Franchise vs Independent Business:

Vendors may also be franchise partners or owners meaning their stake in the business' performance is considerable in terms of capitalization, supplying, managing and branding. For example, McDonald's franchise owners are subject to licensing requirements held by the franchise supplier i.e. McDonalds Corporation. The terms of that licensing relationship may include explicit financing assistance and/or terms.

In the case of independent businesses, the relationship with vendors may not as strong but still important. If a business has had a long standing relationship with a vendor that vendor may be more than willing to assist with financing in a number of ways. Depending on the size of the vendor and the nature of the business, they may even have their own banking division.

Vendor Financing Methods:

*Advertising: Vendors are companies too, therefore any advertising a client business can offer the vendor is worth money to the vendor. In return for certain advertising, vendors may offer deals which may include but not be limited to financing arrangements, discounted supplies and/or favorable business terms.

*Loans: Large, heavily capitalized, nationwide vendors may also own financing companies that act as subsidiaries in the interest of the parent corporation. An example of a financing subsidiary and/or shareholder relationship is GMAC financial services as owned in part by General Motors Corporation. In the case of GMAC, financing is and was made more available to vehicle buyers and vehicle sellers when the need arose. Vendors with or without ownership in financing firms or subsidiaries, may be willing to assist in offering loans and/or capital for financing a business not only as a profit venture, but as a means by which to

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