2 Things You Need to Know About Business To Business Merchant Cash Advance Loans

Merchant cash advance loans fast becoming a mainstream financing strategy for Canadian business to business loan transactions.
However, in talking to clients they are concerned about two key issues around this innovative financing method.
Those two key issues are:
How do they work?
What are the Costs?
We firmly believe that if you understand those two critical points then your firm is in a position to benefit from merchant cash loans and Canadian B to B loan solutions. And those benefits are significant and quite clear. They include your peace of mind as it relates to business financing, since cash flow loans grow with your business and are unlike pre-set bank credit lines, etc . Also, many business owners confuse a business cash advance with other types of debt financing.

Time is money as the Canadian business owner well knows. Merchant cash advance loans in Canada work quickly and efficiently (When you have chosen the right partner and the right type of facility). Once the initial set up process is completed, usually in a week or two the facility runs itself at your discretion. You in effect have taken complete control of your cash flow. Future sales are turned into valuable cash flow today.
Our final key benefit that we should focus on before getting back to our two critical points is simply that this financing tool, if used properly, allows you to generate more sales and increase profits via key turnover of receivables, inventory, etc. Not to get too technical but there is a great tool for analyzing your business called the DUPONT MODEL. It simply allows you to calculate how the actual turnover of receivables and inventory leads to greater profits and returns on assets and equity. We encourage you to investigate that tool for some real analysis of how a business to business cash flow solution might be the solution to your business financing problems.
O.K. You now know many of the key benefits of this type of financing. Is it right for your firm? Critical point #1 how does it work? Cash flow loans against future sales or credit card sales is simply best described as the short term sale, or ‘discounting ‘of your future sales or credit sales .

You generate cash, at your option, on the same day that you generate an invoice for a sale and delivery of product and services to your client base.

Critical Point # 2- What does this type of financing cost? Actually it’s zero per cent financing. Don’t believe us? We are being a bit facetious, but the reality is that the business to business cash flow financing industry in Canada does not express or calculates financing costs via an annual per cent age rate. The problem lies in the fact that customers do in fact look at it that way .We have actually demonstrated too many customers that the true cost of merchant cash advance financing is actually zero or less than bank financing in many cases. Why is that? We hate to do it, but let’s go back to our DuPont Model Financial analysis. If you factor your receivables, get cash the same day, buy more inventory with that cash, negotiate a better price with suppliers with that cash, and then repeat the process over and over we can almost guarantee you, depending on your industry and A/R turnover that receivable financing can become a profit mechanism for your firm. That’s certainly clears up a lot of the ‘negative ‘things you have heard about cash flow loans.
Speak to a trusted, credible and experienced business financing advisor on the benefits of merchant cash advance loans and how they work and how financing costs can be controlled and reduced. That’s true cash flow and working capital financing for Canadian business.

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