Unlocking Growth: How Asset-Based Lending Fuels Modern CPG Brands

“We couldn’t keep up with demand, and the bank said no.”

It’s a familiar story for many high-growth CPG brands. Your product is flying off the shelves, your customer base is expanding, and retailers are placing larger orders than ever before. But just when you're poised to scale, access to capital becomes the bottleneck. Traditional lenders hesitate. Venture capital feels too early—or too expensive. Cash flow is tight, and the growth opportunity starts slipping away.

This is where asset-based lending (ABL) becomes a game-changer.

For CPG brands sitting on valuable inventory, outstanding invoices, or strong purchase orders, ABL offers a flexible, non-dilutive way to turn assets into immediate working capital. Whether you're scaling production, managing seasonal swings, or seizing a new retail opportunity, asset-based lending can be the financial fuel that powers your next phase of growth.

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What Is Asset-Based Lending for CPG Brands?

Asset-based lending is a form of business financing that allows companies to secure credit based on the value of their assets, typically inventory, accounts receivable, and sometimes equipment or purchase orders. The more your business grows, the more capital you can potentially access since the line of credit increases with the value of your assets.

Unlike traditional loans that rely heavily on profitability, credit scores, and long operating histories, ABL centers on what you already have in motion: products, customers, and invoices. This makes it particularly effective for emerging and scaling CPG brands whose financials are healthy but may not yet fit the mold required by banks or institutional lenders.

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Why ABL Works So Well for CPG Businesses

The CPG business is fast-moving, asset-intensive, and often seasonal. That creates unique financial dynamics—and opportunities—where ABL can provide a strategic advantage.

1. Access Capital Without Giving Up Equity

One of the biggest decisions growing brands face is how to fund growth. Venture capital and equity raises are options, but they come at a cost: dilution. ABL is non-dilutive. You retain control of your business and your cap table while still accessing the capital you need to scale.

2. Turn Inventory into a Growth Engine

Inventory is often one of the largest line items on a CPG brand’s balance sheet. With ABL, that inventory doesn’t just sit in a warehouse—it works for you. Lenders like Assembled Brands evaluate your inventory and convert a portion of its value into working capital you can use today. Stock up for seasonality or launch new SKUs—without waiting on bank timelines!

3. Smooth Out Cash Flow Gaps

Retail and wholesale often come with net-30, net-60, or even net-90 payment terms. Meanwhile, your suppliers want payment up front. ABL helps bridge that gap by advancing capital against your accounts receivable. Instead of waiting for customers to pay, you get the money now, and use it to keep moving forward.

4. Support Predictable, Sustainable Growth

Growth isn’t just about the big wins—it’s about the infrastructure to support them. ABL offers predictable access to capital that grows with you, helping you invest confidently in marketing, operations, hiring, or new product development, without worrying whether you’ll outpace your funding.

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Real-World Use Cases: How High-Growth Brands Leverage ABL

📦 Scaling Inventory to Meet Retail Demand

A fast-growing snack brand secures a national retail placement. The retailer places a six-figure PO—but requires delivery within 30 days. Instead of raising a bridge round or tapping cash reserves, the brand uses an ABL facility to fund the production run, secure raw materials, and deliver on time.

🔄 Managing Seasonal Fluctuations

A clean beauty brand sees major Q4 spikes but slow summer sales. With ABL, the brand increases its credit limit ahead of the holiday rush and draws down as needed. When sales dip in Q1, the brand still has capital on hand to invest in marketing and retain top talent—without taking on additional debt.

🌍 Navigating Supply Chain Costs

With rising tariffs and international freight costs, a beverage brand shifts part of its production to a domestic co-packer. The transition requires upfront investment. ABL provides the necessary funds without impacting day-to-day liquidity, ensuring the supply chain remains agile and the margin impact is minimal.

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What Lenders Look for in a Consumer Products Business

While ABL is more flexible than traditional financing, lenders still evaluate key indicators to determine fit. Here's what providers like Assembled Brands typically look for:

Consistent Sales Volume: Lenders want to see reliable product movement and customer demand.

Quality Inventory: Inventory should be sellable, well-organized, and move at a predictable rate.

Reliable Receivables: Retailer or distributor relationships with a solid payment history add value.

Operational Maturity: Strong internal controls and financial visibility signal that a business is ready for structured financing.

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Choosing the Right Asset-Based Lending Partner

Not all ABL providers are created equal, especially when it comes to working with early-stage or fast-growing CPG brands. The right partner should do more than lend money; they should understand your business and support your long-term goals.

Here’s what to look for:

1.  Industry Expertise: Choose a lender that truly understands the CPG landscape—one that knows the difference between managing DTC vs. wholesale cash cycles, the nuances of net terms, and how to structure credit around inventory turns.

2.  Flexible Credit Structures: Look for terms that grow with your business. A good lender will structure your facility so it scales alongside your revenue and inventory levels.

3. Transparent Communication: Avoid hidden fees and opaque underwriting. Choose a partner who provides clear terms, fast decision-making, and ongoing support.

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The Bottom Line

Asset-based lending is more than a financial tool—it’s a growth strategy. For modern CPG brands navigating the complex intersection of rapid growth, operational capital needs, and supply chain risk, ABL offers a flexible, founder-friendly path to scale.

Rather than waiting for customers to pay or diluting your ownership to raise funds, you can put your existing assets to work—funding the next production run, expanding to new retailers, or launching that long-awaited product line.

At Assembled Brands, we specialize in asset-based lending for high-growth CPG and ecommerce businesses. Our flexible credit lines are designed to match your operational cadence—so you can spend less time chasing capital, and more time building your brand.

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