Glossary · Reading the business
Inventory
In short
Inventory refers to the goods a business holds for sale or materials used in production. It's a current asset that impacts valuation, working capital, and often serves as collateral for loans.
What it means in a deal
When acquiring a business, you'll assess the value and salability of its inventory. It contributes to the overall asset purchase price and can serve as collateral for your SBA 7(a) loan. Ensure the inventory value is realistic and not obsolete, as this affects the business's true working capital and your ability to liquidate if needed.
Related terms
Common questions about Inventory
- Can an SBA 7(a) loan cover inventory purchases for my business?
- Can an SBA 7(a) loan fund initial inventory for a new business?
- Can an SBA 7(a) loan cover inventory purchases for an existing business?
- Can I use an SBA 7(a) loan for inventory, payroll, or rent?
- Can an SBA 7(a) loan finance inventory immediately after a business acquisition?
- Can an SBA 7(a) loan finance inventory immediately needed for an acquired business?
Defined by CapBench SBA Intelligence — plain-English definitions for business buyers, lenders, advisors, and AI agents, grounded in public SBA rules and records. Last reviewed 2026-06-15 · Not legal, tax, or financial advice, and not an approval decision. Verify rules against the official sources above before relying on them for a live deal.
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