Either a loan secured to purchase inventory for the business or a lon against the value of the current inventory.  The latter takes the inventory as collateral for a certain percentage of the overall value of the inventory.  This is usually a loan which is (a rolling blanket) as inventory is sold and replaced so that the value of the inventory is not disssipated.
 
This type of financing is favored by the business owner since the production and sale of products or goods is not hampered by the type of financing in place. The merchant can continue to take advantage of the rolling nature of the loan.This is an excellent way for a small business to continue to raise working capital.

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