Raw material prices jumped and I need to buy ahead — how do I fund it?

Buying materials ahead of further price rises can protect margin, but it ties up cash; finance funds a sensible forward buy — sized to real usage, not speculation. If material prices are climbing, buying ahead can lock in today's cost and protect your margin. But forward buying ties up cash, so it's a judgement, not an automatic win.

Raw material prices jumped and I need to buy

2 min read

Prices risingBuy ahead?

Protect marginLock in cost

Fund itBut size it right

When buying ahead makes sense

If material prices are climbing, buying ahead can lock in today's cost and protect your margin. But forward buying ties up cash, so it's a judgement, not an automatic win.

Fund a sensible forward buy

A working-capital facility funds buying ahead, repaid as you use the materials in production. Size the buy to genuine forecast usage using the working-capital calculator.

Don't speculate

Buy ahead against real, forecast demand — not on a bet about prices. Over-buying materials you can't use turns a margin play into trapped cash.

What it means for you

Credicorp lends to your company, not to you personally, and takes no personal guarantee. See business loans or apply online when the numbers work.

Frequently asked questions

Should I buy raw materials ahead of price rises?

When prices are genuinely climbing and you'll use the materials, buying ahead can protect margin. Fund it with a facility, but size the buy to real forecast usage, not speculation.

Can I finance forward-buying materials?

Yes. A working-capital facility funds buying ahead and is repaid as you use the materials. Keep the buy sized to genuine demand so you don't trap cash in stock you can't turn.