Bank Statement Analysis for Wholesale Distributors
Wholesale distributors move high volume on thin margins with heavy inventory and net terms. Learn how lenders analyze distributor bank statements for inventory financing.
Distribution: Volume Business, Thin Margins
Wholesale distributors buy in bulk and resell to retailers and businesses, earning a small percentage on large turnover. The bank statement shows big inflows and big outflows with a modest spread — and that spread, not the gross volume, is what services debt.
How Distributor Revenue Appears
- Customer payments: ACH and checks from retail and B2B accounts, frequently on net terms.
- Supplier/manufacturer outflows: Large recurring inventory purchases.
- Freight and logistics: Significant shipping and warehousing costs.
- Seasonal inventory builds: Cash tied up in stock ahead of peak selling.
The Margin and Receivables Reality
With gross margins often in the 10-25% range, a distributor doing $1M/month in deposits may keep a fraction of that. Layered on top is a receivables cycle — customers pay on terms while suppliers want prompt payment. Underwriters must read the spread and the timing, not the headline volume.
What Lenders Focus On
- True spread between customer inflows and supplier outflows
- Customer concentration and payment reliability
- Inventory-build timing vs. selling season
- NSF and line-of-credit usage patterns
Bottom Line
Distributors are fundable for inventory financing and lines of credit, but only when the thin margin and receivables timing are understood. StatementScrub separates inventory pass-through from true margin automatically.
Related reading: Manufacturing analysis | E-commerce analysis | Cash flow ratios
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