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This is the call where the industry’s reputation is made and lost. The merchant wants money, somebody will place it, and whether that somebody is you comes down to what you find out before you decide.
Establish three things
- How many positions, and what each takes daily. The total remittance as a share of daily receipts is the number that matters.
- Whether the business is profitable before those remittances. A profitable business with a timing problem is a different case from an unprofitable one.
- What the money is actually for. Covering existing remittances is the answer that should stop the conversation.
What actually helps
| Situation | What might help |
|---|---|
| Profitable, timing problem, dated relief coming | Reverse consolidation, with a commitment to stop stacking |
| Positions nearly repaid | Waiting, then a clean renewal |
| One position, strong file | A normal second position |
| Unprofitable underneath the remittances | Nothing you sell. Say so. |
Why the honest version pays
A merchant told plainly that another advance would hurt them remembers it, and a meaningful share of them come back when they are fundable — because they now believe you. That is a slower business than placing everything and a considerably more durable one, and it is the only version that survives the industry getting more regulated rather than less.
It also protects your funder relationships. Files that default trace back to whoever submitted them, and a broker known for placing distressed paper gets read differently on every subsequent deal.
Questions brokers ask
Should you fund a merchant who already has advances?
It depends on how much of their receipts the existing remittances consume and whether the business is profitable underneath them. One position on a strong file is ordinary; four consuming most of the takings is usually not a funding problem.
What is the question that should stop the conversation?
What the money is for. If the answer is covering the existing remittances, another advance makes the failure larger and puts your name on it.
What helps a stacked merchant if an advance does not?
Reverse consolidation where the business is profitable and the problem is timing, or simply waiting until positions are repaid and doing a clean renewal. Where the business is unprofitable underneath the remittances, nothing you sell helps.
Does turning down a stacked deal cost you money?
In the short term, yes. A meaningful share of those merchants return when they are fundable, because you are the broker who told them the truth — and your funder relationships stay intact, which affects every other deal.
How do you find out how many positions there are?
The bank statements, not the merchant. Look for identical debits recurring on every business day, roughly 21 or 22 times a month. Merchants routinely under-report positions without meaning to deceive.
Alex Makowski
Founder, Infinite Bookings
Runs the lead generation operation behind Infinite Bookings — paid traffic, the funding application, and the delivery pipeline that puts records into brokers’ CRMs.
Reachable directly at alex@infinitebookings.com or 732-609-7182.