Sourdough Bakery Secures Production Financing from 1st Commercial Credit to Meet Growing Demand

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Sep 10, 2025, 07:47 ET

AUSTIN, Texas, Sept. 10, 2025 /PRNewswire/ -- 1st Commercial Credit, a leading provider of accounts receivable financing and purchase order financing solutions, has announced the funding of a fast-growing sourdough bakery in the Northeast region through accounts receivable factoring and purchase order production financing.

1st Commercial Credit, a leading provider of accounts receivable and purchase order financing, announced the funding of a rapidly expanding sourdough bakery in the Northeast. The facility, structured through accounts receivable factoring and production financing, will provide the bakery with the working capital needed to fulfill larger orders and sustain its growth momentum.

Underwriting receivables for bakeries can be difficult because of small invoice sizes, numerous customer accounts, and frequent returns or credits, all of which create dilution and offsets that many lenders avoid. In this case, however, the bakery submitted large invoices with consistent, recurring customers, making it feasible to approve the financing request.

The bakery, originally launched as a direct-to-consumer operation, quickly expanded into small grocery chains, coffee shops, restaurants and large private label distributors. Today, it has secured significant orders from large retailers and regional grocery chains, reflecting the rising demand for its artisanal sourdough bread and sandwiches.

While growth has been strong, the bakery's owner recognized the challenge of financing larger purchase orders without straining day-to-day operations. Packaging suppliers, payroll obligations, ingredient costs, and net 60-day credit terms from major buyers created financial pressures that required an outside solution.

"Everything goes smoothly when businesses can self-finance growth—until the big orders arrive," said Raul Esqueda, President of 1st Commercial Credit. "At that point, cash flow gets siphoned into longer production cycles with no income to offset the shortage, and companies risk falling behind on their existing operations. That's where we step in."

After evaluating the bakery's recurring business cycle and the financial strength of its buyers, 1st Commercial Credit structured a combined factoring and purchase order financing facility within a week. This ensured the bakery could fulfill large orders while maintaining stable operations. The decision was supported by the owner's strong business background and the undeniable popularity of the bakery's high-quality sourdough products.

Underwriting bakeries often poses challenges due to small invoices, multiple accounts, and frequent returns or credits, which can lead to dilution and offsets that many lenders decline. In this case, however, the bakery presented large invoices with recurring accounts, making it possible to accommodate the financial request.

This financing partnership positions the bakery to continue scaling production, securing more retail partnerships, and solidifying its role as a competitive player in both traditional markets.

1st Commercial Credit provides invoice factoring and purchase order financing for established businesses with at least one year in operation and recurring sales to the same customers. For more information, visit www.1stcommercialcredit.com or call 1-800-876-6071.

About 1st Commercial Credit
1st Commercial Credit is a Non-Bank Owned factoring company providing purchase order financing solutions to small and mid-market businesses and serves clients across industries such as manufacturing and distributors.

SOURCE 1st Commercial Credit, LLC