WELCOME !

Thanks for dropping in for some hopefully great business info and on occasion some hopefully not too sarcastic comments on the state of Business Financing in Canada and what we are doing about it !

In 2004 I founded 7 PARK AVENUE FINANCIAL. At that time I had spent all my working life, at that time - Over 30 years in Commercial credit and lending and Canadian business financing. I believe the commercial lending landscape has drastically changed in Canada. I believe a void exists for business owners and finance managers for companies, large and small who want service, creativity, and alternatives.

Every day we strive to consistently deliver business financing that you feel meets the needs of your business. If you believe as we do that financing solutions and alternatives exist for your firm we want to talk to you. Our purpose is simple: we want to deliver the best business finance solutions for your company.



Thursday, June 30, 2011

Canadian Business Financing Smackdown? ABL Asset Based Loan Financing vs. Commercial Bank?


It's probably just us, but we been enamored recently by the word ' Smackdown' which denotes a ' battle or severe beating between two parties '. Somehow it's just a neat word! Which got us to thinking... who would win a Smackdown between ABL asset based loan financing and a Canadian commercial bank line from one of our Chartered banks in Canada ? !

We secretly often root for the ABL facility, but we're going to let you decide, the Canadian business owner and financial manager.

ABL financing is one of the few areas that have grown significantly in popularity over the last several years. When the economic implosion of 2008-2009 happened thousands of Canadian businesses started to review their financing options with either their banks or on their own accord. It was ugly... lines of credit were being lowered or pulled in and it simply got a lot hard to write a cheque, make a payroll, etc.

We guess this is the day for ' sayings' because out of necessity came the mother of invention - enter ABL financing. But why does ABL asset based loan financing flourish when other forms of business financing don't?

It's because ABL financing looks at risk management in a whole different manner than a chartered bank. Banks base all of their borrowing on their own issues, such as capital ratios and capital bases, and adjust their risk accordingly. They do a great job of that, and quickly have become world acknowledged as leaders in risk and financial stability. But, at whose expense? We think you know the answer. Yours! Because when banks manager commercial bank loans their do it in a manner that addresses their own issues, ( not yours ) by imposing rations, covenants, the needs for outside collateral, and a strong emphasis on personal guarantees .

But what about our friend ' ABL ' sitting in the corner. It generally uses none of those, simply focusing on the assets you have in your business to allow you to generate maximum liquidity from a business operating line of credit.

So does ABL cost more... and whats involved, if in fact you accept our premise that it’s potentially a better type of financing for Canadian business.

ABL can cost more; sometimes significantly more, and sometimes it can cost less! So don’t forget that. Additionally, as the total focus of an ABL asset based line of credit is assets expect to be able to prove the value of the assets being financing, which include receivables, inventory, fixed assets such as equipment, and yes, even real estate. All of those assets are in effect thrown together to get you a business line of credit that makes sense, and focuses solely one item- your assets. Because you borrow against all those assets in a bulk facility, daily, as you need it, be prepared to show you can report properly and methodically, either weekly or monthly, on items such as aged receivables, inventory. Etc.

Trends rarely lie. Certainly not at the outset! So its no surprise that thousands of Canadian firms are gravitating to asset based loan financing for their lines of credit. Abl lenders take more risk (bad for them ... good for you ...) and that risk and return issue they face translates into more liquidity for you.

Is there a perfect answer to our question on who would win the Smackdown? We're not sure, but we do believe that if you seek and talk to a trusted, credible and experienced Canadian business financing advisor that you will be in a better position to determine which business financing solution works best for you when it comes to a business line of credit.





Stan Prokop - founder of 7 Park Avenue Financial -

http://www.7parkavenuefinancial.com


Originating business financing for Canadian companies , specializing in working capital, cash flow, asset based financing . In business 7 years - has completed in excess of 80 Million $$ of financing for Canadian corporations .Info re: Canadian business financing & contact details :


http://www.7parkavenuefinancial.com/abl_asset_based_loan_financing_commercial_bank.html

Wednesday, June 29, 2011

The Working Capital Lifecycle - Canadian Business Cash Flow Loans and Financing


It's all about the lifecycle. We think that’s a great way to look at how Canadian business owners and financial managers can look at the different stages of life their business is in - all of which relates back to business cash flow and working capital needs. The bottom line - Different types of loans financing options are available at different stages of your firms lifecycle.

Let’s examine what that lifecycle is about and how knowing what stage your business is in reflects the kind of working capital you need.

Start up firms grows from great or aspiring ideas. This is when capital is most often a real challenge, and the combination of owner equity and debt becomes the total issue for the entrepreneur. As the company starts to gain traction and grow revenues in the early years financing comes from both traditional and non traditional sources.

It's important to spend time at this stage in the lifecycle to determine the amount of capital you need, on items such as operations, inventory, facilities, etc. Doing your homework at this stage in the lifecycle will prevent many future problems!

Inevitably many firms face a growth crisis. This is one of the key areas of the company lifecycle we'll address in looking at some solutions to this often challenging time in any business owners life.

As the growth challenges are solved (hopefully) businesses transition into maturity and inevitably look to a transition of some sort - i.e. sale, divestiture, merger, wind down, etc. The bottom line, we've just walked you through the business lifecycle.

Who can assist you in the challenges of solving various challenges at different points in the lifecycle? Typically people such as your lawyers, accountants, bankers, and consultants and advisors are the ones with solutions.

When clients ask us about working capital and ' the bank ' we always only say one thing - it's the banker, not the bank. The ability to find a great commercial banker is worth its weight in gold .Your ability to find a competent and confident commercial banker who can point out the sources of traditional bank financing and then execute on them for you is invaluable.

Having collateral and assets is critical in a working capital bank borrowing environment. No matter how you look at it, in Canada that borrowing is also going to require both personal guarantees and potentially collateral outside of the business. You can’t escape that requirement in Canadian business cash flow loan financing.

Many of the clients we deal with either cant access traditional bank capital, or choose not to go that route for reasons of the guarantees and collateral we mentioned. That’s when non bank financing becomes an alternative solution.

Solutions such as receivable financing, working capital facilities, asset based lending, and financing of your tax credits can all ensure you have access to business cash flow. While some of these solutions are more expensive than bank financing they are more readily obtained and still improve your balance sheet and allow you to build your business.

It’s often the balance sheet which can help you determine which stage of the business lifecycle you are in. Your ability to expand, pay your short term bills such as suppliers, loans, etc are keys to the business lifecycle. Naturally larger more established companies have more assets, and ' wiggle room ' we can say to address working capital issues.

Good business cash flow solutions will make your company more viable at any stage of the business lifecycle. Your ability to borrow during any stage of the business lifecycle allows you to move forward to the next stage of transition in your company.

Want to discuss any working capital solutions, allowing to you plan, and not react to cash flow challenges. Consider seeking and talking to a trusted, credible and experienced Canadian business financing advisor for help in obtaining alternatives to address your cash cycles.




Stan Prokop - founder of 7 Park Avenue Financial -

http://www.7parkavenuefinancial.com
Originating business financing for Canadian companies , specializing in working capital, cash flow, asset based financing . In business 7 years - has completed in excess of 80 Million $$ of financing for Canadian corporations .Info re: Canadian business financing & contact details :


http://www.7parkavenuefinancial.com/working_capital_business_cash_flow_loans_financing.html

Tuesday, June 28, 2011

The Magnificent 7 Reasons For Equipment Lease Finance - Make Canadian Asset Finance & Leasing Work !


Recently we wrote on the subject of providing 3 great reasons for Canadian companies to strongly consider equipment lease finance as their financing strategy in the acquisition of new equipment. Financing assets has never been more easy.

The essence of those three reasons we discussed were the concept of 100% financing of assets, utilizing leasing and financing as an inflation hedge, and finally the ability to get a better handle on the useful economic life of any asset you acquire. How? By matching the term of your lease with cash outflows of lease finance.

But... guess what. There's more. Let's discuss 7 other solid real world considerations for Canadian business owners and financial managers considering equipment lease finance.

Timing. Many lessees (that’s you) have important deadlines, vendor issues, competitive issues, etc. Unlike banks or other finance firms leasing companies in Canada are only focused on one thing - funding your transaction. So whether it’s a 900 $ micro ticket deal, or a 9 Million dollar piece of mining equipment you will always get it done faster (we believe) by working with an independent specialized lessor. This impacts time you may waste on legals, documentation, and credit approval, all of which are important to clients.

Additional add ons - that’s reason number 2 today. It makes sense in business to bundle (don’t our telcos and cable companies do a good job of that. In a leasing and financing transaction you can add in a lot of extras, for financial and convenience issues and benefits. I.E. maintenance, insurance, delivery, training, etc.

Reason # 3- The accountant in the corner... you know who we're talking about, the guy with the proverbial ' budget '. Leasing eliminates capital budget issues, operating versus capital issues, and cash flow challenges. Could leasing have made that guy any happier? We don’t think so!

Reason # 4- lender restrictions and covenants. Utilize creative financing providing by such vehicles as operating leasing and financing to eliminate covenant, off balance sheet, and ratio issues. It's a complex world in commercial lending, but a solid lease financing partner can help you work through a lot of issues that otherwise could restrict your ability to properly acquire the financial assets you need.

A lot of accounting rules are changing out there... some people predict the death of operating leases. We're not sure, but we are sure that lease accounting is one more thing in your finance toolkit that gives you something to work with.

Reason # 5- the proverbial monthly payment. Want it fixed, or perhaps variable. Want some cash flow seasonality in your lease structure..? No problem. Step up? Step Down? Step leases are payment structures that alternative according to seasonality, budgets, etc. If you need them, they are there!

Reason # 6- Working capital considerations. Your ability to achieve significant financing via leasing allows you to preserve credit lines and cash flow. You can spend all the time you want on lease versus buy analysis - but at the end of the day cash is king as Canadian business owners and financial mangers well know.

And finally, reason # 7 of our magnificent 7! Flexibility and asset obsolescence management. The right type of lease financing allows you all sorts of flexibility re rights of return, termination, upgrade, purchase of the asset, etc. Investigate them, use them.

Speak to a trusted, credible and experienced Canadian business financing advisor on how the reasons to utilize lease finance for asset finance can work for your firm .




Stan Prokop - founder of 7 Park Avenue Financial -

http://www.7parkavenuefinancial.com

Originating business financing for Canadian companies , specializing in working capital, cash flow, asset based financing . In business 7 years - has completed in excess of 80 Million $$ of financing for Canadian corporations .Info re: Canadian business financing & contact details :

http://www.7parkavenuefinancial.com/equipment_lease_finance_leasing_financing.html

Monday, June 27, 2011

Breakthrough In Financing Accounts Receivable ! New Fresh Approach To Best Invoice Factoring in Canada


Surpassing a restriction - that’s how a breakthrough is defined , and we're sharing info on how financing accounts receivable and achieving the best invoice factoring in Canada just got a whole lot better !

Thousands of small and medium sizes businesses in Canada (and by the way, a number of larger corporations also!) have moved towards an independent non - bank method of financing accounts receivable in the Canadian business landscape .

But is there a way in which you can achieve the breakthrough that we're referring to? First of all let’s make sure we are all singing from the same hymn book so to speak... covering off the essence of this type of financing.

Simply speaking accounts receivable financing, aka ' factoring ‘... ‘invoice discounting ' is the sale of your receivables , as you generate them , for instant cash flow and working capital . In the majority of cases of this type of financing you still assume the risk of the non collection of receivables, but you're simply monetizing or cash flowing that portfolio of A/R for quick access to cash.

Also of note is the fact that typically while you don't have to finance a receivable immediately as its generated, at the same time invoices over 90 days generally cant be financed as they are assumed as uncollectible . We are always encouraging clients to monitor their A/R agings and schedules to ensure they have a maximum handle on accounts receivable status.

Clients ask why businesses choose this type of financing over traditional A/R finance such as bank lines of credit, etc. That answer could not be simpler, it’s a case of getting capital and cash flow that you might otherwise not achieve through a bank, plus it’s quick, with the major benefit being that your facility grows as your sales grow. You do not have a pre -set limit per se. That’s a huge benefit.

But let’s focus on some potential drawbacks to this type of finance - we've always thought it’s important to present a balanced view. One of those drawbacks is the perceived cost of the financing. Back to that word perceived in a moment. The whole issue of cost and pricing of A/R financing is one of two issues we are always spending time with clients on. The industry as a whole views the transaction as a discounted sale price, while customers perceive that pricing as an annual per centage rate.

On a day to day basis, as you finance your receivables, they are in effect ' purchased’... at a ' discount ' to their face value. The discount rate on a 30 day receivable in Canada varies widely... that’s why its important to work with an expert to achieve maximum best financing. That rate tends to be in the 1-3% range more often than not.

However... back to our word ' perception '. Most clients don’t understand there are numerous methods to offset that financing cost, in some cases in its entirety. Its a case of using new found cash flow to take supplier discounts, purchase more effectively, and take on new business that otherwise might not have been possible .

So, is the suspense killing you? Let's not forget the ' breakthrough' we talked about - which is what we have come to call ' C I D '. Its confidential invoice discounting, and it goes against the grain of all the U.S. and U.K. companies in Canada that offer this type of financing. It puts you in control, and that’s a good thing, right? You bill and collect your own receivables, with no notification to your clients, suppliers, etc.

Most clients balk at the use of financing accounts receivable via factoring solely because of the issue of notification to your clients, and we're just removed that issue. So that, coupled with the best invoice factoring pricing you can achieve makes this financing very attractive to firms that can’t achieve bank or traditional financing of their working capital.

Check out C I D, confidential invoice discounting... speak to a trusted, credible and experienced Canadian business financing advisor on how you can achieve the best invoice factoring and financing from a viewpoint of cost and confidentiality.



Stan Prokop - founder of 7 Park Avenue Financial -

http://www.7parkavenuefinancial.com

Originating business financing for Canadian companies , specializing in working capital, cash flow, asset based financing . In business 7 years - has completed in excess of 80 Million $$ of financing for Canadian corporations .Info re: Canadian business financing & contact details :

http://www.7parkavenuefinancial.com/financing_accounts_receivable_best_factoring.html

Sunday, June 26, 2011

Sound Acquisition Financing Ideas – Commercial Business Loans For Purchase & Merger


Your company has made the decision to either merge or acquire another business. What are some of the key issues in successfully completing acquisition financing and business loans for commercial entities in Canada?

A good place to start is simply to ensure you’ve got the right reasons or goals around a merger or acquisition. In some cases you wish to diversify your company, more often than not though it’s simply a case of growing, both sales and profits of course.

Is the term ‘opportunistic a negative one? We certainly don’t think so when it comes to legitimate business dealings, so in many cases you simply have come across a firm or competitor that in your opinion is undervalued. Bottom line, it’s a bargain and you're focused on exploiting either undervalued assets or companies that are not performing well in certain market conditions.

Don't forget also that acquisition financing is all about some even more common sense scenarios as identified above. Its often a classic opportunity to lower your operating costs as overheads in the dual firm can be cut and other efficiencies can be extracted from the combined mix .

What are the types of acquisitions? We can summarize those into three areas, and in some cases the type of acquisition you make will impact directly the type of financing and commercial business loans that you achieve.

Back to our three merger scenarios - they are as follows: friendly, hostile, and leveraged or management buyout. Many smaller companies are of course happy and content to be taken over; they fully realize the potential synergies. However in certain cases it gets somewhat ' ugly ' in that the management or owners of the firm you intend to buy or acquire simply are opposed to the idea.

Leveraged and management buyouts tend to be asset driven. The downside of a leveraged or management buyout is that if done improperly a large amount of debt can leverage your new firm negatively. There are numerous creative ways to finance acquisition financing in Canada.

Financing methods include asset based lending, subordinate or mezzanine debt (i.e. unsecured loans based on historical and future cash flows) as well as a private equity component.

Valuation is an important aspect in the area of acquisition financing. Your valuation will have a direct impact on the business loans you enter into to complete the purchase. In evaluating a final valuation or purchase price you will want to look at things like general financial operating activities - i.e. the financials. But don’t forget also that other factors such as new assets that might be required, working capital needs, etc also will drive that final valuation number.

In summary, when contemplating acquisition financing look at issues such as the proper mix of debt and equity, cash flow analysis, , and various areas of operational risk and reward . If you want financial alternatives in financing your acquisition consider talking to a trusted, credible and experienced Canadian business financing advisor who will assist you in this exciting area of Canadian business finance.



Stan Prokop - founder of 7 Park Avenue Financial -

http://www.7parkavenuefinancial.com

Originating business financing for Canadian companies , specializing in working capital, cash flow, asset based financing . In business 7 years - has completed in excess of 80 Million $$ of financing for Canadian corporations .Info re: Canadian business financing & contact details :


http://www.7parkavenuefinancial.com/acquisition_financing_business_loans_commercial.html

Saturday, June 25, 2011

Interested In Business Acquisition Buyout Financing For A Canadian Purchase ?


Talk about a capital expenditure. We're discussing Canadian business acquisition buyout financing in Canada and purchase loans available for funding this type of transaction – primarily for the small to medium enterprise in Canada .

Naturally as a Canadian business owner or financial manager it’s critical that any acquisition and its financing challenges be handled in a manner which properly positions your firm for future success and profits. The simple reality is that typically transactions of this nature involve significant amounts of capital relative to the size of your current firm.

Naturally its all about cash - the simple financial model is of course your firms ability to ensure future cash flows receive exceed the purchase price. In reality the only way in which you should consider paying a significant premium is when there is a strong case for putting the two firms together for significant improvement in both.

Another consideration that business owners must also make prior to contemplating purchase loans is the issue of ' diversification ' and the dangers of taking your firm into an unrelated business . Diversification for its own sake clearly might not be an optimal strategy.

So just when is a business acquisition related to your industry, and when is it not? The experts are quite clear on that - if you have markets and clients that are similar, or utilize a technology or science that is also similar then clearly you're acquiring or buying into a related industry. When Canadian business owners and financial managers buy into a similar industry they clearly have a better idea of cash flows and the basic business model - that's a good thing.

In a perfect world you wish to acquire or retain a strong management team when contemplating an acquisition. This certainly makes business acquisition buyout financing less difficult. At the end of the day we can probably all agree with the fact that your skills as the acquirer are potentially more critical than those of the business you are acquiring. It's your challenge of course to make the synergies, profits and sales stay positive.

Do you really need an investment or merchant banker or professional deal maker to complete successful proper purchase loans in small and medium sized business acquisition? We'll go against the grain and say not always - we think that with the assistance of an advisor you're in a position to identify a financing objective and execute on a purchase loan and financing alternative that makes sense for all parties.

So, contemplating an acquisition in the small to medium sized marketplace in Canada? Want some assistance on pricing, areas of risk, and the best way to finance the acquisition. Speak to a trusted credible and experienced Canadian business financing advisor who will assist you with your objectives.




Stan Prokop - founder of 7 Park Avenue Financial -

http://www.7parkavenuefinancial.com

Originating business financing for Canadian companies , specializing in working capital, cash flow, asset based financing . In business 7 years - has completed in excess of 80 Million $$ of financing for Canadian corporations .Info re: Canadian business financing & contact details :
http://www.7

parkavenuefinancial.com/business_acquisition_buyout_financing_purchase.html

Friday, June 24, 2011

Notes From The Trenches – Canadian Financing For Franchises – Get Your Business Franchise Loan Right !


It's sometimes just the thought of wondering how financing for franchises works, and if in fact you will be approved for a business franchise loan that gives you discomfort. Let's examine whats happening in franchise finance today out there in the trenches, aka the real world!

It's pretty clear to yourself that when you're contemplating the purchase of a franchise you will need financial assistance via a franchise loan to complete your project. Those funds in effect compliment or complete your equity, i.e. your own investment into your new business. We point out to clients that the same challenges and issues pertain to whether you're purchasing a brand new ' turnkey ' operation or if you are purchasing from an existing franchisee who is selling.

P.S. Don't forget to ask why the franchisee is selling?!

So where is commercial lending at Vis a Vis Canadian franchise financing? Do you have to do a lot of homework to investigate how to successfully complete a franchise finance loan?

Naturally in a perfect world ( its not always perfect as you may have observed ) you're looking for financing that completes your transaction, has reasonable rates, and provides you with a term on the loan that is suitable for both cash flow and repayment .

In Canada franchises are financed successfully in a number of manners - but it’s certainly not a large choice, so it’s important to focus early on, on what you can achieve and with whom. There are one or two specialty franchise finance firms but these firms typically focus on the relationships they have with some of the largest an well know franchisors, many of whom have franchises for sale in the 1 Million dollar ++ range . That isn’t for everyone of course.

It's actually the Canadian government (that’s a surprise!? that has a huge role in financing for franchises in Canada, but in a somewhat indirect method. They sponsor a loan program called the BIL/CSBF loan that provides financing for a huge amount of franchisees in Canada. The program is clearly a champion of small business, on which franchising is of course based - independent owners and operators working with success franchisors in Canada.

The government in effect guarantees a very large percentage of the loan, allowing you to receive those rates, terms and structures that are absolutely some of the best financing terms in Canada, bar none.

What do you need to do then to get your franchise financing house in order then? It's not a cake walk, but quite frankly is not as hard as you think to accomplish your goal of a success business franchise loan.

You want to be able to ensure that you're prepared - naturally you would do that for any business financing you would ever contemplate. You need to be able demonstrate a reasonable personal credit history ,as well as some level of either general business knowledge or industry specific knowledge relative to the industry within which your franchise is located, i.e. restaurants, service business, etc.

It's important to have a clear cut business plan that demonstrates how your financial package looks, i.e. how the combination of your own equity and the loan will allow you to acquire the franchise, and, of great interest to the lender, repay the loan.

Will your franchisor help you in all this? Yes... and no. It's our observation that franchisors are focused on selling franchises, not financing them! So be prepared to carry the weight of most of the work in completing you’re financing for franchises.

Want some help? There’s lots out there. Consider talking to a trusted, credible and experienced Canadian business financing advisor who can assist you to achieve your goal as a successful franchisee in the booming Canadian franchise market.




Stan Prokop - founder of 7 Park Avenue Financial -

http://www.7parkavenuefinancial.com

Originating business financing for Canadian companies , specializing in working capital, cash flow, asset based financing . In business 7 years - has completed in excess of 80 Million $$ of financing for Canadian corporations .Info re: Canadian business financing & contact details :

http://www.7parkavenuefinancial.com/financing_for_franchises_business_franchise_loan.html

Thursday, June 23, 2011

Why Postpone Business Success? Investigate ABL Lines Of Credit & Asset Based Lending In Canada


Sure you could wait. Maybe later this year... next year, or several years down the road..? We're talking about getting all the business financing you need and why ABL lines of revolving credit via asset based lending can work for your firm... today!

We think all our clients agree that in today’s competitive environment ' waiting ' for things to change is not going to work! So let’s consider a type of financing that will work, today, and for the future.

Hard hit. That's how many businesses, small, medium, and yes, large... feel about being caught in the downdraft of the difficulty to obtain the proper amount o fbusiness financing they need. The 2008 - 2009 recessions didn’t help, and even our world wide admired Canadian banks had to hunker down, which in your case meant less access to capital as if you didn’t know already. The bottom line, it was simply business credit was, and to some extent is, tougher to obtain.

The above conditions and the ever changing Canadian business financing landscape has made it a ' perfect storm ' for ABL lines of credit and asset based lending . Businesses who have been forced, or who finally realize they had non-bank business financing options are exploring ABL (the acronym for asset based lending) every day in Canada these days, with thousands of companies having ' signed up for the program '.

Canadian businesses of all types are investigating ABL. It’s very simple really, they either have no access to traditional funding, or if they do, it’s not for the amount of capital they need. Others simply adopt the Boy Scout motto - BE PREPARED ‘! and are proactively seeking alternative operating line of credit solutions. The bottom line - working capital and cash flow has become ' job #1' for Canadian business.

Want a simple, basic reason why companies are looking for a financing alternative. It’s just that firms have more debt, accounts payable days have risen, and, no surprise, clients are waiting much longer to get paid by their own customers.

Many Canadian business owners and financial managers haven’t even heard of ABL, much less embrace it. A lot of the new interest is in the SME marketplace, but many of Canada's largest corporations utilize this financing also.

It is no longer ' financing of last resort '... in fact it’s become an unbelievable tool to grow your business. expand into new markets, acquire a competitor, or even just survive after some challenging years or special circumstances your company may have encountered.

ABL lines of revolving credit, just a basic term for asst based lending is simply a business revolving line of credit that allows you to borrow against all your assets - those being receivables, inventory, and fixed assets and real estate, if that comes into play. The difference? You can borrow significantly more, because the total focus is on assets.

In Canada ABL lines go from 250k and up, with really no upper limit on the amount of your facility, we're talking millions of course. Your credit availability increases very significantly based on the elimination of the traditional Canadian chartered bank issues of rations, covenants, outside collateral, personal net worth, etc, etc. The bottom line, you are borrowing on your assets!

There are some different, lets call them ' flavors ' in the Canadian ABL asset based lending marketplace. The facilities come in different shapes and sizes; can be just receivable based, or a full service solution delivering extra capital against all your assets.

So, can you afford to wait or postpone business financing success? If you do, we're jealous of course. If you can’t wait, speak to a trusted, credible, and experienced Canadian business financing advisor on achieving benefits of ABL finance... today!





Stan Prokop - founder of 7 Park Avenue Financial -

http://www.7parkavenuefinancial.com


Originating business financing for Canadian companies , specializing in working capital, cash flow, asset based financing . In business 7 years - has completed in excess of 80 Million $$ of financing for Canadian corporations .Info re: Canadian business financing & contact details :


http://www.7parkavenuefinancial.com/abl_lines_of_revolving_credit_asset_based_lending.html

Wednesday, June 22, 2011

5 Guaranteed Business Working Capital & Cash Management Solutions For Liquidity - Canada


Are there any ' guarantees' in Canadian business financing? A guarantee is something that ' assures a particular outcome ' . So we're not 101% sure we can give you that iron clad guarantee , but we will show you 5 proven methods of enhancing cash management and working capital solutions in Canada .

Strategy # 1 - Not optimal, but again it's all about choices. So our tip/strategy is to consider sale of fixed assets you own but might not be getting full use of in your day to day operations. Naturally you would not consider selling assets you need on a day to day basis, but are there some unproductive assets around? There just might well be.

You naturally want to ensure that these assets are fully owned by your firm and not encumbered by any liens or bank security agreements. In some cases a reasonable strategy might be to replace e the asset with a less costly one, or used perhaps?

Strategy #2 - The sale - leaseback. This strategy, as we have noted before is just the opposite of acquiring and financing new assets. You already own the asset and it should be free and clear of any security arrangements. By working with a Canadian lease financing company you would enter into an arrangement whereby you sell the equipment back to the lessor and lease it back.

These transactions are generally done at what is known as fair market value, so you expect to not be able to get all the money you paid for the asset of course. In some cases an actual appraisal might be required, which typically would be in the 1-2k range depending on the size of the asset.

Generally speaking, the sale leaseback or a bridge loan on an already owned asset is a strategy worth considering when it makes sense.

Strategy 3- Inventory. That’s always a tough one for Canadian business owners and financial mangers to wrestle with. Financing inventory is a challenge and although there are some specific financiers able to monetize your inventory generally this is in connection with a total financing of your business. Financing and monetizing inventory works best, in Canada, in our opinion, when its part of an asset based lending arrangement or working capital facility.

It only makes common sense also that you could consider selling off any obsolete or slow moving inventory, again, if that makes sense and is possible.

Strategy # 4- Other assets. There are sometimes other hidden assets, in that business owners might no typically consider such items as patents, or tax credits as financeable items. But they are and can be monetized for their true value.

Well, we're here, last but not least, Strategy # 5. And to be honest it’s our most recommended one for small and medium business in Canada. It’s simply the monetization of your receivables via a receivable finance facility.

Why is this favorite strategy? Simply because for a starter you are not taking on any additional debt, you are just ' cash flowing ' assets that are already there. And these sort of facilities allow you to grow your business lock step with your sales. So working capital and cash management grow as you grow your revenues.

Our recommended facility is C I D - Confidential invoice discounting, allowing you to bill and collect your own receivables, unlike you competitors who are using this strategy and having to involve their client base re notification, etc.

Well, there you have it. 5 methods or solutions to cash management and working capital. Are they guaranteed? We are saying they work, and that’s all. Will all of them work and be appropriate for your firm. Doubtful, but we are pretty confident that somewhere in our toolkit of solutions is a working capital mechanism just for your firm. Speak to a trusted, credible and experienced Canadian business financing advisor who can assist you in evaluating options.



Stan Prokop - founder of 7 Park Avenue Financial -


http://www.7parkavenuefinancial.com

Originating business financing for Canadian companies , specializing in working capital, cash flow, asset based financing . In business 7 years - has completed in excess of 80 Million $$ of financing for Canadian corporations .Info re: Canadian business financing & contact details :


http://www.7parkavenuefinancial.com/working_capital_cash_management_solutions.html

Tuesday, June 21, 2011

Capture 3 Benefits Of Lease Financing – With Canadian Finance And Leasing Companies


If we gave you 3 , among many, solid reasons to consider lease financing with finance and leasing companies in Canada , don't you think that just a couple of them would work for you, for sure? Maybe all 3 would?

If your company would like to become part of the successful majority of Canadian business in Canada it’s about time you understood and considered lease finance.

What then are some key reasons why business in Canada utilizes lease finance? There are other options of course, and it's up to you the business owner to determine which one works best for you, carefully analyzing whether debt or equity makes the most sense for your firm. It all comes down to whats important to your company and where you are heading with asset acquisition.

Reason #1 - Yes, there may be a down payment sometimes or a nominal security deposit but in general lease financing provides you with the ability to finance the entire asset. The asset is of course the ' hard cost ' of your acquisition, but many Canadian business owners and financial managers are pleased to know that there are numerous add ons let us call them, that can be , yes, ' added on' to the lease. They are items such as delivery, installation, warranty, training, service, etc.

Reason # 2- We hate to sound like economists here but the reality is that lease financing is a solid hedge against inflation. You in effect slow down the use of your funds, and at the same time can use cash flow and working capital you otherwise might have spent on the asset. That’s just common sense right?


Reason # 3- Term. One of the smartest things you can do when working with finance and leasing companies is to match the term of the lease with your best business estimate on the useful life the of asset . You're matching cash outflows to the benefits you receive from the asset, bringing those two together as much as you possible can.

Naturally we all realize that some assets depreciate quickly, some less so, and in a few cases (aircraft as an example ... or very heavy production equipment) the deprecation and obsolescence aspect is less of a concern.

In Canada lease terms can theoretically go to ten years in some cases, however the real world out there tends to favor 3-5 year lease terms. Many clients often are looking for a shorter term for specific project or asset type reasons - The shortest term we tend to recommend is 24 months - anything less than that doesn’t make real sense for the lessor, or yourself.


This then is your firms moment. Consider the 3 tips and benefits we have provided .You of course have everything to gain and nothing to lose. Want more info, or even help ?Speak to a trusted, credible and experienced Canadian business financing advisor who can maximize , for your company , these and other benefits of lease financing in Canada .





Stan Prokop - founder of 7 Park Avenue Financial -

http://www.7parkavenuefinancial.com

Originating business financing for Canadian companies , specializing in working capital, cash flow, asset based financing . In business 7 years - has completed in excess of 80 Million $$ of financing for Canadian corporations .Info re: Canadian business financing & contact details :

http://www.7parkavenuefinancial.com/finance_and_leasing_companies_lease_financing.html

Monday, June 20, 2011

Canada’s Newest Biz Financing – Receivable Financing Companies and Providers Of A/R Loan Plans


New. Improved. Are we talking about laundry detergent? Not really, instead let’s take a look at Canada’s newest and growing in popularity, form of business financing, A/R loan plans. Can receivable financing companies be the solution to your business challenges? We think so and so let’s show you how the providers of this type of financing work.

Clients always tend to ask us simply why they should be looking at receivable financing .That’s one of the easier questions we get these days.

There are some very strong fundamental reasons why you should be looking at this type of financing for your business, not the least of which is acceleration of cash flow. Receivable finance allows your company to receive cash flow and working capital the day you generate an invoice. Practically speaking you could draw on your invoices every day, but reality shows that most firms borrow on a weekly or monthly basis. Bottom line, it’s your call.

Another key reason that provides of a receivable loan plan work is simply that they have become the de fact alternative to bank financing in Canada. That’s predominantly for small and medium sized business, but you’d be surprised to know that many of Canada’s largest corporations use a flavor of this type of financing also.

In today’s competitive environment your ability to be cash flow positive allows you to enhance your relationship with customers and your valued suppliers. It’s simply a case of what you could call ' professional visibility ‘... and that’s a good thing!

If you are in fact utilizing receivable financing companies for your A/R finance you also are able to leverage at the same time other aspects of Canadian business financing, this includes equipment financing, tax credit financing, term loans, etc. The bottom line is that the providers of an A/R loan are solely interested in collateralizing your receivables, not all your other assets.

Is there one final reason perhaps to consider a provider of A/R loan plan financing? We'll give you a great one, there is essentially no funding limit, in that as your A/R grows so can your facility. Is it just us or have you turned your firm into an ATM machine. That’s cash flow 101 for sure.

The attraction to invoice financing, aka factoring, is just simply that it’s a solution to the ongoing struggle of businesses requiring working capital. And as biz financing tightened up in the last few years Canadian business owners and financial managers looked for alternatives.

That alternative quickly emerged as accounts receivable financing. It’s the selling of your receivables at a discount, as you generate them. The challenge in Canada is picking the right type of facility - our recommended solution to clients is called C I D , confidential invoice discounting, allowing you to bill and collect your own a/r without the notification that is required by your clients for other types of facilities that predominate the marketplace.

So, bottom line? If you are looking for either business survival, or business growth take advantage of the service offered by receivable financing companies. If other sources are limited, and you require capital for expanding your business the solution lies right in front of you, and is being embraced by thousands of other Canadian business owners.

Speak to a trusted, credible and experienced Canadian business financing advisor on why receivable financing companies and providers of A/R loans can help your firm, today.



Stan Prokop - founder of 7 Park Avenue Financial -

http://www.7parkavenuefinancial.com

Originating business financing for Canadian companies , specializing in working capital, cash flow, asset based financing . In business 7 years - has completed in excess of 80 Million $$ of financing for Canadian corporations .Info re: Canadian business financing & contact details :

http://www.7parkavenuefinancial.com/receivable_financing_companies_providers_loan_plan.html

Sunday, June 19, 2011

7 Reasons Why Lease Financing Companies Offer Advantages Of Leasing Equipment In Canada



It isn't enough to be only a ' little' in the know when it comes to business financing and your Canadian firms overall growth and success. Let's examine 7 solid and beneficial reasons how lease financing companies can demonstrate the advantages of leasing equipment for your company.

Its a simple question really. ‘Why Do Lessees Lease'? There are a variety of solid reasons and advantages and benefits to equpment financing in Canada.

We're isolated 7 of those reasons (lucky # 7?) to demonstrate the general financing power of this Canadian business financing strategy.

Reason #1 - 80% of all companies in North America lease equipment at one time or another. Not a great reason you say? We at least hope that you'll agree that if your competition is doing something you should at least be aware or analyze why that the case. As you will see your competition has focused on issues such as working capital preservation, accounting benefits, and plain old convenience.

Reason #2 - Tax benefits. The last thing we want clients to do is get caught up in the whole issue of tax treatment of leases, let’s leave that to your accountants and business advisors. But the reality is that there are significant benefits that are tax oriented when it comes to the product offering of lease financing companies in Canada. They include such critical factors as depreciation, off balance sheet financing, etc. Again, leave it to the experts, but it’s a solid aspect of equipment finance in Canada.

Reason # 3 - Matching financing to useful economic life. What are we talking about? Just common sense really, which is simply the fact that one of the advantages of leasing equpment in Canada is that you can match the estimated useful economic life of any asset you purchase (from a photocopier to an airplane!) to your lease term. Technology is a great example of this, in that it depreciates quickly, has a huge obsolescence issue attached to it, and your ability to craft lease financing that matches the tech asset is huge. At the other ends of the spectrum, lease that corporate jet for 10, 15 or 20 years, there's an asset that hangs around for a long time!

Reason #4 - Solid lease rates. The great news is that Canadian equpment leasing and financing is on a total upswing as we head thru 2011. The industry has revitalized, recapitalized, and is very competitive. A lot of the lease finance pricing you obtain will be competitive to bank rates and other forms of finance such as term loans for assets.

Unfortunately many clients we speak to for the first time on asset finance are overly focused on rate. Our point is that it’s a competitive environment, and your current credit quality will get you a good rate in the current finance environment, so you'd do a lot better, we feel, if you focused on some of those other advantages we're talking about.

Reason #5 - Assets. They come in all shapes and sizes for your firm and industry. Tech assets, production assets, etc. The only bottom line... simple... any asset can be financed using a lease strategy. So if the cost and turnover of assets is a constant consideration utilize lease financing as a regular ' refresh ' strategy.

Reason # 6- Measurements. Measurements? What we're talking about is simply that how your business owners, investors, or shareholders are measure can sometimes be significantly impacted by the assets you acquire. Return on assets, return on equity, ebitda, are key ways to measure whether your company is winning and losing. Lease financing can often impact all of these measurements, and depending on what your ' business scorecard ' is, can help you manage capital and assets.

Reason # 7- Last, but not least, isn’t it always about Cash flow. It sure is, and if your company is either as start up or a Canadian Financial Post 100 firm you have cash flow challenges, issues, and measurements around that term. Lease financing allows you to eliminate a lot of those working capital worries, it minimizes or gets rid of down payment issues, pays the supplier and vendor promptly, and can provide 100% financing for your asset. Very simply, it conserves cash.


Well, that’s it. Are the advantages of leasing equipment better than other capital asset strategies? We think so, but that’s for you to decide. And getting back to the competition, they're doing it, so why not speak to a trusted, credible and experienced Canadian business financing and leasing advisor who can assist you to maximize these benefits.



Stan Prokop - founder of 7 Park Avenue Financial -

http://www.7parkavenuefinancial.com

Originating business financing for Canadian companies , specializing in working capital, cash flow, asset based financing . In business 7 years - has completed in excess of 80 Million $$ of financing for Canadian corporations .Info re: Canadian business financing & contact details :

http://www.7parkavenuefinancial.com/lease_financing_companies_advantages_of_leasing.html

Saturday, June 18, 2011

Does Your Firm Need Bank Lines Of Credit ? Ready For Canadian Business To Business Financing ?


For every complaint you hear about Canadian business to business financing and our chartered banks (Trust us, we hear a few!) there are still some great things happening in commercial business banking in Canada . Let's examine bank lines of credit, and your need for such a facility to grow your sales and profits.

Canadian businesses use operating lines of credit to finance current assets. Typically those asset categories are predominantly accounts receivable and inventory.

So how do banks facilitate this borrowing arrangement? The typical manner in which this is done is to simply have a document executed that provides the bank with a conditional assignment of accounts receivable, your inventories, and any other current assets.

Canadian bank operating facilities are also called demand loans, because they are typically secured by another document called a GSA, which stands for Genera Security Agreement. This document, as you can imagine, allows the bank to ' call ' your firms loan at any time .It's just common sense that Canadian banks do never with to ' call ' those loans, its simply their protection if and when things go awry.

Clients are sometimes under the mistaken impression that bank lines of credit are good for an indefinite amount of time. Typically however they are renewed annually - which requires a review by your account manager.

If there is one other very common question asked by clients it revolves around how exactly the banks calculate lines of credit. The formula is not as complicated as you think! A typical business to business financing on a Canadian chartered bank line of credit margins your accounts receivable at 75% or their value. Its critical here to note that the bank uses 90 days as a measurement tool - no receivables over 90d days can be margined, or in effect ' borrowed against ‘. Why is that? Again, common sense prevails, in that the bank, (and us too by the way!) makes an assumption that the receivables over 90 days are uncollectible to a certain extent. Your firm might think differently, but that’s how it’s done.

Inventory. Wow! What a different kettle of fish this is! If we had to generalize, but be as specific as we can be for info purposes we can say that in general banks really wrestle with inventory financing. Margining and inventory percentages are very different based on your industry, as well as the composition of your inventory. (Inventory typically comes in three categories: raw materials, work in process, and finished goods)

Typical bank financing of inventory usually never exceeds 50% and at the same time usually has a cap on the facility, meaning that even if your inventory is growing it still might be subject to a maximum of financeability.

The take away here is that banks aren’t in the inventory business, these assets are much harder to liquidate than receivables, and rarely does a lender ' win ' in an inventory liquidation!

So let’s get back to the security the bank takes on bank lines of credit. Do your clients find out about this? In Canada they would normally never be notified unless there is a default by your firm on the line of credit facility. In that case you clients would receive a notification of assignment, in which the bank would direct your clients to pay them directly, reducing the loan of course.

Banks register their security with the appropriate provincial and federal authorities, further protecting their position.

There is a great tendency in Canada to ' blame ' our conservative banks for limiting lending possibilities for commercial business to business financing. (We love our banks by the way).

Consider the reality though, that we entrust them to protect our savings and deposits, and its Canadian business owners and financial mangers that run their businesses into problems.

Clients are encouraged to maintain solid relations and seek out great commercial business bankers. (Not all are great unfortunately). If you're looking for a banking facility that works, for both you and the bank seek to speak to a trusted, credible and experienced Canadian business financing advisor who will assist you in managing your bank as a partner, not an adversary, thereby maximizing your bank line of credit for your firms sales and profit growth.




Stan Prokop - founder of 7 Park Avenue Financial -

http://www.7parkavenuefinancial.com

Originating business financing for Canadian companies , specializing in working capital, cash flow, asset based financing . In business 7 years - has completed in excess of 80 Million $$ of financing for Canadian corporations .Info re: Canadian business financing & contact details :

http://www.7parkavenuefinancial.com/bank_lines_of_credit_business_to_financing.html

Friday, June 17, 2011

Delve Into Canadian Sale and Lease Back Financing – Benefits Of This Type Of Leasing Of Equipment



Is a sale and lease back leasing of equipment you own already a good financial strategy? We get that question from a lot of clients so let’s clarify some key issues around this type of equipment finance.

Equipment leasing in Canada seems to be on a tremendous upswing again, having been hit fairly severely in recent years. As a result the sale leaseback strategy we can say was somewhat out of favor in the last couple years, but the good news is, as we said, that times are changing and this finance strategy is back.

In a sales lease back scenario it’s all about the asset and various issues come into play.

Exactly what is the strategy itself though - it’s important for Canadian business owners and financial managers to ensure they understand the benefits of the transaction, how it works, and most importantly, how to get it done effectively.

The sale and lease back strategy is just a twist on normal leasing of equipment. That should be no surprise. Typically either you or the leasing company would purchase or order equipment, which is paid for by the lease finance firm and then leased back to yourself. That’s business equipment financing 101 right? and there's a lot of benefits to doing that .

However in our sale and lease back strategy you are already of course the owner of the equipment. So you are in a dual role of the seller of the asset, as well as the new potential lessee.

Let's utilize a short example. Let’s say you are a manufacturer and you have an unencumbered asset, typically perhaps production equipment valued at $ 300,000.00. You may have purchased the asset for significantly more, but the current value for our example discussion is 300k. You then enter into a lease back situation - you ' sell ' the equipment to your lessor and then lease it back.

So what just happened here? Let’s see. First of all, the equipment you already own never leaves your production floor. You also just got a cheque for $ 300,000.00 to be used for whatever corporate purpose you wish. The monthly payments on the lease would typically be in the 7000/mo range, using a 48 month term as an example.

Let's examine why a business would use this strategy. The right reasons are typically for additional working capital and the ability to grow the business further. In effect you have monetized valuable assets and are using them to grow sales and profits.

Are rates higher on sale and leaseback transactions? They might be a bit higher, but at the end of the day quite frankly its our experience that they will be commensurate with your overall credit quality of your company , as well as of course the intrinsic or appraised asset value of what is being re financed.

Lessees and business owners opting for a sale lease back strategy should ensure lease terms are kept realistic. If possible we try to ensure that clients aren’t required to also commit further collateral to the transaction if it isn’t required. Lease companies have a habit of trying to over collateralize on occasion!

In summary, as a source of working capital and cash flow for the right reasons the sale and lease back leasing of equipment is a solid financial strategy. Speak to a trusted, credible and experienced Canadian business financing advisor who can assist you in maximizing the benefits and avoiding the pitfalls of this strategy.




Stan Prokop - founder of 7 Park Avenue Financial -

http://www.7parkavenuefinancial.com

Originating business financing for Canadian companies , specializing in working capital, cash flow, asset based financing . In business 7 years - has completed in excess of 80 Million $$ of financing for Canadian corporations .Info re: Canadian business financing & contact details :

http://www.7parkavenuefinancial.com/sale_and_lease_back_leasing_of_equipment.html

Expert Advice – Info On How To Finance A Franchise Business In Canada – Franchisee Loan Financing


Just a thought here, but why not do it right the first time? We're talking about how to finance a franchise business and obtain the right financing loan for your new life as a franchisee.

Let's share some tips on how things are done, with a focus on ' getting it right the first time '. We're also hoping that by this time you have a strong sense of what franchise you are looking to purchase and that you are comfortable you can run the business from a financial and operational perspective.

So where does one begin? It's often not where you might think. While there are hundreds of quality franchisors out there it’s a bit of mis - information if you think that the franchisors responsibility or talent will help you actually get the business financing you need to start the franchise. Of course they want you to get approved, and often can assist in some manner, but at the end of the day the responsibility to get this financing completed lies with yourself!

Banks are interested in financing your franchise, but in somewhat of a specialized manner which we'll address shortly.

Job one simply is determining the amount of capital you need. Thing you need to consider also is the breakdown of that capital. Why? Simply because different types of financing are more suited and applicable to different types of assets.

Items you typically need to consider are the franchise fee itself, i.e. your gateway to the business! As well as equipment, leaseholds and working capital. Those key categories are a pretty good way of categorizing and summarizing your financing needs. Naturally your premises lease is a separate issue and operating cost.

We often point to clients who ask us how to finance a franchise business that it’s as important to consider the ongoing financing needs of the business as it is to focus on getting the original financing in place. You want to be able to get a sense of what your overall financial plan looks like when it comes to sales, costs, and profits - its those profits of course that repay the loans you will enter into !

We can't remember a time when a client has not asked us the proverbial question - ' so how much do I have to put in ‘... referrring of course to their owner equity of beginning capital in the business. We're never one to sounds like our good lawyer friends, but the reality is that it depends. (That’s not always the answer our clients were looking for). However, in broad terms we can say that you can be expected to put up anywhere from 10- 40% based on the nature of your business and the amount of capital you are going to need.

Franchises in Canada are financed by only a handful of means. Let’s recap them for you, and then you can hopefully determine which method is best.

We certainly don’t recommend paying all cash or collapsing savings to pay for 100% of your franchise. A mixture of debt and equity is always the better way to go. Naturally you don’t want too much debt, and at the same time you want to obtain some proper... what the financial folks call ' leverage ' to ensure you get a good long term return on the money you have put in and borrowed.

Franchises in Canada a financing loan that will complete your franchise tends to come from 3 sources - the BIL/CSBF loan that is sponsored by Industry Canada, as well as financing from specialized independent finance firms that focus solely on franchise finance. These firms typically only deal with very established franchisors, so they are not going to be able to suit the majority of Canadian potential franchisees. Specialized finance firms such as lease companies also can provide a key financing component to your finance success.

For the right match of debt financing and the best finance solution for your particular needs consider spending some time with an experienced, credible and trusted Canadian business financing advisor who can assist you in your franchise business goals.


Stan Prokop - founder of 7 Park Avenue Financial -

http://www.7parkavenuefinancial.com

Originating business financing for Canadian companies , specializing in working capital, cash flow, asset based financing . In business 7 years - has completed in excess of 80 Million $$ of financing for Canadian corporations .Info re: Canadian business financing & contact details :

http://www.7parkavenuefinancial.com/how_to_finance_a_franchise_business_financing_loan.html

Thursday, June 16, 2011

Understanding ABL Backed Loans & Asset Based Financing In Canada – Not What You Think!


Challenge yourself to invest some time in understanding asset based financing. Once you understand ' ABL ' loans we're quite confident you'll give them strong consideration for your Canadian business financing needs.

ABL (Asset backed lending) loans are asset based lines of credit that provide you with a business operating line of credit similar to a Canadian chartered bank facility. Big deal, we can hear you say, whats the big difference.

All we'll say for the present is ' lots ‘! and we'll leave it up for you to decide whats the best solution for your firm . We can categorically tell clients that we have seen numerous examples where firms who couldn’t access bank facilities for operating credit could now have all the operating funds they need for working capital and cash flow purposes.

Secondly, many firms see their credit facilities double if not more on occasion, once they understand and embrace asset based lines of credit .So I guess now it’s up to us prove it to you. so here we go !

You’ll find very quickly that the asset based financing places a huge emphasis on what we call your operating cycle - simply speaking your credit facility is structured to match your operating cycle. And what exactly is that cycle ?Its really just the tracking of how cash flow goes through your business, from the time you purchase inventory ( unless you're a service company of course ) to the time you generate sales and of course receivables .. and finally your collection of that a/r. Simple as that . That’s your operating cycle.

We agree with many clients that their business is unique, rarely does a Canadian business owner or financial manager feel they aren’t special! But the reality is that many industries have the same operating dynamics and cycles and challenges - and you will find asset based lenders tend to be a bit more experienced than our friends at Canadian chartered banks on industry issues .

It’s actually possible to calculate your operating cycle in days and compute some very accurate working capital and cash flow needs just out of 3 or 4 basic calculations.

So you can see where we are heading here, its just simply that understanding asset based financing is about ensuring you have enough cash flow and working capital to work through your own firms entire operating cycle . Naturally large more well heeled corporations can finance daily needs via their own profits and existing capital structure. They are usually more eligible for bank and traditional type borrowing.

But thousands of smaller and medium sized corporations, who are growing, have challenges, or who have really unique situations can't often access traditional bank financing.

That’s where ABL loans come into play - you simply have the ability to convert assets such as A/R, inventory and other fixed or hard assets into a business line of credit - outside of the chartered banks!

ABL lenders work extra hard to understand your business. Why? It's pretty simple. They have to! Simply because they place little or no emphasis on the borrowing criteria of banks, which typically include ratio maintenance, covenants, outside collateral, personal guarantees, well... ytou get the drill!

By spending a significant amount of time eon your business, industry, and operating cycle an
ABL lender can better put together a facility that works uniquely, for you. Bottom line, this is not cookie cutter financing.

Factors such as your management or ownership team, the quality of your assets, and their marketability quickly become job #1 for an ABL lender, but all of that translates into higher borrowing facilities for you - just what you needed and couldn’t get previously.

So, have we convinced you? At a minimum we hope understanding asset based financing has just become a bit easier. And hopefully we've shattered some of the mis information around why this type of facility differs from a bank offering.

More info. Questions? Costs of this type of financing? Seek a trusted, credible and experienced Canadian business financing advisor who can ensure this type of non bank operating business line of credit is for your firm.




Stan Prokop - founder of 7 Park Avenue Financial -

http://www.7parkavenuefinancial.com

Originating business financing for Canadian companies , specializing in working capital, cash flow, asset based financing . In business 7 years - has completed in excess of 80 Million $$ of financing for Canadian corporations .Info re: Canadian business financing & contact details :

http://www.7parkavenuefinancial.com/understanding_asset_based_financing_abl_loans.html

Wednesday, June 15, 2011

Relieve The Challenge Of Canadian Business Cash Flow Loans & Financing – Working Capital Solutions




A call to battle! Overly dramatic? Maybe ... maybe not. But its a great definition of challenges , and very applicable to what Canadian business owners and financial managers face when confronting business cash flow loans financing, or just in general assessing working capital problems .

Success business owners are solution oriented. You have to be.

It seems like a common sense statement that you have to understand the problem before you can fix it. When it comes to cash flow a number of areas can be pinpointed as the problem, its quite rare that it’s just one single item.

Some of those other problems might be a slowdown, (or increase ... by the way!) of sales, external issues that you have no control over - in general market challenges.

Certain financing arrangements you might enter into could actually be dangerous for your firm. It might be as simple as having taken on too much debt , or having an operating facility or working capital arrangement that has too many restrictions on what you can borrow, and what you can borrow against .

Another common mistake we often see is that many credit facilities are set in stone, in effect they are ' capped' so even though you have growing sales, good receivable and inventory .. Well you know the story, you are unable to access a higher limit and tap into the working capital you need.

The optimal solution for any business is the ability of your firm to access higher operating lines when your business is growing or expanding.

A good way to understand this is to imagine that when sales are growing your current cash outflows or payments are being made on items and expenses that were incurred weeks or months previous. So you are in effect accessing business cash flow from your current larger asset based to reduce the obligations of your older debt.

We always spent time with clients ensuring they understand the differences of profitability and cash flow. We find it ironic that many times their success in being able to access business cash flow loans financing and working capital can end up being their downfall. How? It's simple. When business owners and managers are in a position to pay their bills all the time... they, guess what? assume profitability!.

But when things turn around and sales slow and inventories and A/R shrink then there is the danger of being trapped in a downward spiral.

So how can you watch out for some of these key factors ? When you think of it , they are really just basics - if your business cash flow is trending down and your sales are stable there is a problem . If you are in a cyclical business then understand then ensure you understand your cycles. Is it possible to grow to fast or over expand? It sure is. So yes, it’s great to grow, but at what cost.

In today’s environment that are both traditional and newer alternatives to working capital. Many of them don’t involve taking on extra debt. They includes asset based lines of credit, combo receivable and inventory facilities, tax credit financing, purchase order financing , confidential invoice discounting, etc .

Want some help in both recognizing potential problems, and more importantly seeking viable solutions? Seek and speak to a trusted, credible and experienced Canadian business financing advisor who can set you on the road to elimination those working capital and cash flow challenges.





Stan Prokop - founder of 7 Park Avenue Financial -

http://www.7parkavenuefinancial.com

Originating business financing for Canadian companies , specializing in working capital, cash flow, asset based financing . In business 7 years - has completed in excess of 80 Million $$ of financing for Canadian corporations .Info re: Canadian business financing & contact details :

http://www.7parkavenuefinancial.com/business_cash_flow_loans_financing_working_capital.html





Tuesday, June 14, 2011

Business Computer Laptop Leasing & PC Financing In Canada - Smart Tools & Smart Choices

Put yourself to the test, and ask yourself this simple question: Are you 100% comfortable with what you understand about business computer leasing and PC financing. From laptop to desktop to notebook to tablet, let's ensure you have some of the basics under your belt... so to speak!

When you are purchasing, and then financing technology assets such as those that we have described thee are certain economics that come into play. Financing those economics can be the make and break between a good decision and a bad decision... and trust us we're not talking about your choice of hardware or software manufacturer.


Let's explain. The reality is that there are some special decisions you need to make when financing a tech asset. Naturally you want to receive the benefits of the technology, keep your firm competitive, etc, but at the same time smart financing and acquisition strategies wouldn’t be bad either, right?

So let’s dig in. One major difference we can cover off quite quickly is simply that software, as well as hardware can be financed. We're talking about application software though, not development software, which is a different kettle of fish and a more complex discussion for a later date. A significant amount of Canadian businesses don’t seem to realize that software can be financed.

Traditionally software you finance along with business computer leasing is done on a 2-5 year term - we would never recommend a longer term for tech assets - quite frankly with changing technologies 2 years makes sense.

One great trick we have picked up over the years ( can we call it a trick ? !) is to structure a combination hardware and software business computer leasing and PC financing transaction on a 3 year operating lease, with the software being priced on a capital lease to own basis within that same transaction .

Whether you are financing a business computer laptop or a huge server farm you essentially have two choices of lease types in Canada - Capital and operating. Operating leases, you should know, play a huge part in the tech industry in Canada. If you have owned any computing in your home you quickly have probably become and expert in operating lease financing and didn’t know it.

How is that, ask our clients. Simply that you quickly realize technology changes, and anticipating that a laptop, PC, notebook, etc will last you a number of years is an incorrect assumption. It still might work; it’s just that it will be slower and not being able to handle new apps, programs, features, etc!

That’s why we tell clients they can adopt the same tech financing strategies as the largest corporations in Canada - utilizing operating leases. Why? Simply because an operating lease, which is a ' lease to use ' gives you triple flexibility during the usage of your product. Why triple? Simply because you can upgrade, return, or purchase the asset at any time during the term of the lease! That's true flexibility.

Smart choices can also be made around all the soft costs associated with a business computer laptop and pc financing strategy. Why? Simply because items such as delivery, installation, warranty, etc can be financed. Remember simply that your deal is with the hardware of software maker re terms of use, etc, - Your tech leasing partner simply facilitates that with some complimentary financing to lower your cash outflows.


So whats our bottom line, simply that tech financing is a little different, requires some specialized info on best structures and optimal advantages that accrue to you the user. Just the choice of lease type alone can save you thousands of dollars on any one transaction.

Want some extra help. Speak to a trusted, credible and experienced Canadian business financing advisor on business computer leasing - from laptop to PC. Make those smart choices in technology finance.




Stan Prokop - founder of 7 Park Avenue Financial -

http://www.7parkavenuefinancial.com

Originating business financing for Canadian companies , specializing in working capital, cash flow, asset based financing . In business 7 years - has completed in excess of 80 Million $$ of financing for Canadian corporations .Info re: Canadian business financing & contact details :

http://www.7parkavenuefinancial.com/laptop_business_computer_leasing_pc_financing.html

Monday, June 13, 2011

Imagine! Canadian Accounts Receivable Loans That Work – Financing Receivables The Right Way

Anyone who knows about the challenges of business financing in Canada knows that capital is harder to obtain these days, recession over notwithstanding! So when clients hear about accounts receivable loans and financing receivables strategies that seem to work for others, including their competitors, well... naturally they want to know more.

Let's share some basics around A/R loans (they are not really loans per se) and what the best method of financing receivables is in Canada.


Cash flow shortages. Sounds like a common challenge you face almost all the time these days. But when solutions to those shortages seem limited then a financing receivables strategy just might be your optimal solution.

In order to embrace a new finance strategy you have to know what it is, and what it costs, and even as important, how does it work. At its most simplest this type of business financing can best be explained as the selling of your A/R as you generate sales, getting cash in return. Naturally there has to be a focus on the quality of the receivable, and its age. (Generally receivables are sold when they are current).

Many clients always ask if they need to sell receivables as soon as they generate them, as in some cases they just might not need the cash flow and additional working capital at that moment. The answer is that you can sell your A/R anytime you want, typically as long as the receivable is less than 90 days. (If your A/R is older than 90 days there is somewhat of an assumption that it is uncollectible, unless you have given special terms to your clients.

So why do firms in Canada embrace this new form of financing more and more every day. Simply because it frees up the capital that you have tied up in inventory and A/R, your current assets. Financing receivables can be implemented more much quickly than any other type of loan or financing.

And, oh yes, getting back to that word ' loan ' - we mentioned that many clients refer to this strategy as ' accounts receivables loans '.

The last thing you want to do when you are short of working capital is to take on debt, so its very important to understand that this type of financing, also called ' invoice discounting ‘.. or ' factoring’ does not, we repeat ' does not ‘! bring any debt to your balance sheet. The world loan is a misnomer here, as all you are doing is monetizing or cash flowing your assets, making them immediately liquid.

Any Canadian business owner or financial manager would prefer to take on a new solution to their business in the right way. That means from a viewpoint of both cost and methodology.

Many clients view the cost of financing receivables as a setback. In Canada depending on the size of your A/R and some other factors the costs run between 1-3% per month. What business owners forget is that they can offset those costs in a number of different ways... they could increase their prices nominally, they can take discounts with their suppliers with their new found cash, and, if applicable, they can ' purchase ' smarter and harder. further reducing their cost of financing .

Our favorite and most recommended accounts receivable loans is a strategy called C I D. It stands for confidential invoice discounting, whereby you bill and collect your own receivables during the entire financing receivables process. Unlike your competitors, who are forced into rigorous notification of their financing with their clients or suppliers?

In summary, not all business financing strategies work for all firms. But firms of all size in Canada, even large corporations are looking at A/R strategies. Make sure you get a facility that works for your firm, both from a cost and daily procedural basis. When in doubt, or if you need more info, seek a trusted Canadian business financing advisor who can make sure the ' right way ' is your way!



Stan Prokop - founder of 7 Park Avenue Financial -

http://www.7parkavenuefinancial.com

Originating business financing for Canadian companies , specializing in working capital, cash flow, asset based financing . In business 7 years - has completed in excess of 80 Million $$ of financing for Canadian corporations .Info re: Canadian business financing & contact details :

http://www.7parkavenuefinancial.com/financing_receivables_account_receivable_loans.html

Sunday, June 12, 2011

The Real Truth On Canadian Film Tax Credit – Let Movie & Animation Financing Refund Loans Enhance Your Project

You already have the financing in place that it takes to make a winning film, animation, and TV project successful - you just might not know it.

We're talking about the Canadian film tax credit system, and why movie and animation refund financing of your tax credit can be the last piece of the puzzle in your Canadian production, or U.S./Canadian co -production.

The reality is, and of course we're sorry (kind of ...) that more and more U.S. regions are eliminating or downsizing the film and animation tax credits that can often make or break your projects final success. In fact, using Hollywood California as an example, as at June 2011 the state has in fact used up all their tax credits for the remainder of the year! No wonder why U.S. and of course Canadian producers and owners realize the Canadian system is still committed to job creation and support of the industry.

Ours has never been to debate the merits of the Canadian film tax credit (animation and TV included of course)... Ours has been to promote it and ensure our clients are using it. In Canada , aka Hollywood North the tax credits are viewed in all provinces as great economic and tourism development, and, as we said , we're not arguing!

In Canada the film, TV, movie and animation credits can generally get up to 40% of your project financed. That of course leaves the other 60% up to you, but what a great head start!

Although most producers and owners think of the Canadian film tax credit in terms of movies/ film etc. the Digital media area is probably growing the quickest. 6 of Canada's ten provinces already have a separate special digital media tax credit in place.

B.C. has a very strong and growing animation environment (could that be because of its proximity to California?!) and provides 17 1/2% credit to your total labour cost on any project.

While most U.S. and Canadian producers always tend to think in terms of Toronto, Montreal and Vancouver as major film and production and animation centres the reality is currently that the most lucrative digital tax credit is out of Nova Scotia. They have a very simple formula, 50% of expenditures that qualify under the legislation, or 25% of your total budget. Your tax credit accountant and Canadian business financing advisor can assist you in maximizing what works best for your project.

Quebec also increased and broadened its tax credits, with 25% of all expenditures qualifying for a Canadian film tax credit refund. When you compliment this with the federal Productions Services tax credit an additional 16% of financing becomes available.

Naturally there are all sorts of nuances in maximizing and qualifying for your tax credits. Producers should in general always set up a special purpose entity and typically should own the copyright or content.

Your tax credits in Canada can be financed, either through traditional sources, or independent firms specializing in this type of financing, also at the same time usually helping you maximize the credits. Financing is available on a ‘when completed ' basis, or, often more desirable, on an accrual basis as you start to spend on your project. Bottom line: Cash flow and working capital for your project.

So, as we said your challenge is equity, debt, gap pre -sales, etc. But let tax credits be the final component to your projects success.

If you choose you could creatively carve out the tax credit from your overall finance plan and enhance the equity position, of simply finance the credit refund on its own. Use your tax credit to either attract an investor, or as a stand alone component.

When you want the real truth and current dynamics of the Canadian film tax credit and refinancing strategies speak to a trusted, credible and experienced Canadian business financing advisor.

P.S. Mr. Demille - we're ready for our (tax credit) close up!





Stan Prokop - founder of 7 Park Avenue Financial -

http://www.7parkavenuefinancial.comOriginating business financing for Canadian companies , specializing in working capital, cash flow, asset based financing . In business 7 years - has completed in excess of 80 Million $$ of financing for Canadian corporations .Info re: Canadian business financing & contact details :

http://www.7parkavenuefinancial.com/canadian_film_tax_credit_movie_animation_refund.html

Saturday, June 11, 2011

Unlimited Time Offer – The Canada Small Business Loan – Government SBL Loans For Financing Success




You're in for a pleasant surprise. Why? Because the information we're sharing should absolutely convince you that the ' SBL ‘, the Canada small business loan , aka ' the government loan' is by far the best amongst loans for small and medium sized businesses in Canada .

Let’s get that ' medium' size out of the way quickly before we begin. To qualify and receive the Canada SBL loan you must have actual or projected revenues less than 5 Million dollars per annum. That covers a lot of our clients, so it is easy to see why they are genuinely excited about this often misunderstood part of the Canadian business financing landscape.

Let's set some groundwork here. We're going to cover off whats important to you - so pardon us for paraphrasing typical questions we receive everyday on this program. What are those questions -? They are as follows: Why have we not heard about this program, who manages the program, how much can we get, and what do we need to do to qualify.

We think you'll agree that if we cover off all those bases you'll be well grounded in determining if the Canadian small business loan, aka the ' government SBL ' is right for you.

So, first question. Why haven’t you heard about the program? Quick answer - we're not sure, because 7441 of your peers and, worse yet, your competitors took advantage of the program in 2010. Oh and by the way, they got loans totaling $ 957,000,000.00. That’s an average of about 128k per loan, but most of the requests we see tend to be in the 200-300k range.

You also may not have heard about the program because of its unique structure. It's sponsored and mandated by the folks at INDUSTRY CANADA in Ottawa... but you don’t need to drive there to get the loan. The government has mandated Canadian banks to offer the loan under the terms and conditions of the program.

Which brings us to a side point which is that we're often asked why many small business and commercial bankers don't talk up or offer or recommend this great financing strategy for business loans. We suspect, and surely they can’t be proud of it, that many bankers either haven’t taken the time or have had the training to facilitate this loan properly... we suspect they would prefer to sell us a mutual fund or mortgage. Anyway, we'll weigh in on that one another day.

So, how much financing can you get under the program. The program actually goes to $ 500,000 but that is if it is a real estate type deal. Typically the program caps out at $ 350,000.00 for 99% of business owners.

Many clients are disheartened to hear the loan is not a ' cash loan ' or a revolving line of credit. It isn’t - it’s a term loan with very attractive rates, and can be used for equipment, leasehold improvements, software, etc.

If we had to identify two quick qualifiers for the Canada Small business loan it would be a reasonable credit history of the business owner, as well as a properly prepared package.

The 'package ' i.e. your proposal, has been the downfall of many clients we have spoken to who have ventured on their own to get the SBL loan approved. They simply aren’t prepared on some key basis, such as a executive summary, business plan, cash flow, etc. ( Banks for whatever reason love to see hwo they will get repaid!)

Well... there you have it. Want to fast track the best business financing in town? Speak to an expert, a trusted credible and experienced Canadian business financing advisor who will assist you in your approval and funding.

PS. Government loans don't even require a full personal guarantee, another great reason to consider the program.




Information by Stan Prokop - 7 Park Avenue Financial
http://www.7parkavenuefinancial.com/canada_small_business_loan_government_loans_sbl.html

We finance the little guy . P.S. We finance the big guys also!

Are You Interested In Achieving Best Leasing Rates & Financing With Canadian Lease Companies?



It may seem difficult for Canadian business owners and financial managers to think they can achieve the best leasing rates and business financing with lease companies in Canada.

It's not as hard as you think, and we're going to demonstrate to you some key methods to ensure you understand, and can achieve prompt credit approval and solid lease pricing.

And oh yes, some extra tips on ensuring some additional benefits not readily known to everyone would help also, and we’ll be sharing those also.

Most business owners know intuitively that they should be leasing - one simply reason is that millions of other firms are also .They simply are looking for a better or easier way to understand what makes a ' perfect ' lease financing transaction .

Ways in which you can determine what level of pricing and prompt credit approval you can achieve focus around some very basic issue - for example, do you want to own the asset, or use it. Just that decision alone will save you thousands of dollars and significantly impact working capital. Lets use a ' real world ' (that’s where we work every day) example.

Let’s say your company requires some significant plant equipment as an example. The cost is, say $300,000.00. You're not entirely sure you can afford the asset; you simply know you need it, and you are perfectly sure you can't afford to pay cash for it. Imagine what that would do to your bank line of credit or cash on hand!

Using our example the monthly payment on a 3 year lease would be 9338$ approximately. We estimated an interest rate of 8% on the transaction. Let's say you determine that you can afford $7000/ mo, but not $9338. Does leasing provide a solution? ... It sure does?

Ask you lessor to determine the term you need to change the lease to, allowing you to fit your payment. We've done the calc for you, and its 51 months. And, guess what, by committing to a longer term you can usually get a lower interest rate. Lessors like when they can guarantee their yield for a longer period. No surprise here, as that’s how they make money.

We don’t necessarily agree, but most clients we talk to are ' only ' focused on the lowest pricing or monthly payment in trying to achieve those best leasing rates. Lease financing companies consider a number of factors when offering you those rates.

So what are the key issues in lease pricing, and, more importantly, which of those can you as a Canadian business owner and lessee impact upon?

All assets can be financed, subject to credit worthiness. However, some assets depreciate slowly, some very quickly (think computers!), and some assets both hold their value, or even appreciate in price. Asset class plays a big factor in lease pricing, so be prepared to position and defend your asset quality.

Useful life of the asset is somewhat the same; don’t expect to get a 5 year lease at great rates on state of the art computers or telecom unless your firm has a stellar credit rating.

If your firm is entering into an operating lease it is highly recommended that you arm yourself with the best possible date on residual values of the asset at any future point in time. That will allow you to negotiate a higher residual, and achieve best leasing rates and financing.

We noted there are some aspects of leasing rates and pricing you simply won’t have an effect on. It should come as no surprise that leasing companies borrow money also. Their cost of funds and their required ' yields ' determine... your lease pricing. (As well as your credit quality of course)

So we can make a broad general statement that best leasing rates are achieved by dealing with larger more well capitalized lease companies in Canada.

In many case small admin and processing fees can add up and drive up your leasing rates. Negotiate hard and determine if these additional add on type charges are really necessary and if you can avoid them your pricing will improve.

Simple, perhaps not, but you can see that many factors determine lease pricing. Determine which ones make the most impact on your firm, and which factors you can influence. Speak to a trusted, credible and experienced Canadian business financing and leasing advisor for assistance in achieving best financing and lease pricing in Canada.


7 Park Avenue Financial - Financing for the little guy - P.S. We finance the big guys too!

http://www.7parkavenuefinancial.com/best_leasing_rates_financing_lease_companies.html