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.

Saturday, April 30, 2011

Secrets of Dealing With Equipment Leasing Financing Companies : Tips on Successful lease finance sourcing and negotiations

What's my rate? Are we approved? What are my rights and obligations under this transaction? What's the capital of North Dakota... oh sorry, forget that last one..!

And on it goes... these are just some of the many questions that clients ask us when they are looking for assistance in sourcing and negotiating equipment leasing and working with financing companies in that regard . We do acknowledge it’s a big challenge sometimes - the Canadian marketplace is a bit different than its counterpart in the U.S. The finance industry is fragmented, and business owners and financial mangers absolutely could not be expected to know the credit appetite, the asset appetite, and the structuring options available from literally hundreds of firms offering lease financing.

Let's share some ' secrets' and tips around ensuring you can be successful in your equipment financing strategy. First of all, different strokes for different folks - what do we mean by that? Simply there are number of very well published ' equipment leasing benefits ' offered by finance firms. Do they all apply to your firm? Probably note, so focus in on understanding which benefits of lease financing work for you, and then... maximize them! Through effective negotiations.

For the record those benefits usually include payment structuring to your cash flow, tax advantages, upgrade and return options, and simply being an alternative to traditional debt and loan negotiation. Oh and we forgot one other key benefit, its generally recognized that lease financing credit approval is significantly easier to obtain than bank term debt or other loan mechanisms of a more traditional nature .

Psst... Want to know another secret. Here's a good one, that almost no transaction is too large or too small for the Canadian equipment financing market. So, if it makes sense to lease a 2000.00 photocopier consider it, and if you're buying a corporate jet for 3 Million dollars, there is a lease approval for that asset also.

If there is on obvious secret or tip that most owners miss it’s simply that when it comes to any type of ' technology ' you should consider equipment leasing with financing companies that are knowledgeable about the asset. We are mostly talking about computers, but the tech universe today covers telecom, and many other types of assets. Technology changes, tech assets depreciates very quickly, and the best kept secret in town is often a technology operating lease , allowing you full use, but not ownership, of the asset .

Many clients seem confused by the ' lingo' used by financing companies. You can be forgiven for not knowing ' off balance sheet leasing, residuals, fmv, all in rate, amort, ' etc, etc etc. So the best and final secret we can probably provide for you is simply to search out a trusted, credible, and experienced Canadian business financing advisor who will help you identify priorities and finalize equipment leasing success for your asset acquisitions.

Oh and by the way. Bismarck. That’s the capital of North Dakota.

Stan Prokop - founder of 7 Park Avenue Financial -


Originating business financing for Canadian companies , specializing in working capital, cash flow, asset based financing . In business 7 years - has completed in excess of 50 Million $$ of financing for Canadian corporations .

We finance the little guy .

P.S. We finance the big guys too!

Why Your Competition Is Stampeding To Business Equipment Leasing Financing – Canadian Commercial Finance Advice

Be honest . Whether you admit it more often than not we're looking over our shoulder at the competition and what they are doing. Why not instead lead the stampede towards successful business equipment leasing and financing for the commercial finance needs you have in business equipment acquisition?

Well known business author Steven Covey ( The 7 Habits ...”) had a great line: ' Diagnose before you prescribe ‘. I guess we're breaking his rule a teeny bit because we do strongly feel that business leasing and equipment financing should be in your toolkit already as a Canadian business owner or financial manager. And we don't even know what your financial challenges or problems are... so that’s somewhat presumptuous of us... wouldn't you say?

Over 80% of Canadian businesses lease assets - your competition is doing it today. Why are they stampeding toward this type of financing solution - simply because they are choosing not to purchase outright and tie up huge amounts of cash (relatively speaking) and use up that much required working capital that’s needed for daily operations.

Your competitors are focused on two things - selling more, and making a buck!

Bank term loans often require additional collateral and other covenants to make a financing transaction happen - Business equipment leasing financing doesn’t not do that, it’s a commercial finance alternative that makes sense.

Getting approved is always half the battle when we talk to clients about their finance challenges. If you have a solid financial history, good business credit, and all those financial ratios that a lender looks at you can achieve extremely low lease financing rates in the Canadian marketplace.

But, look at some of your competition - as a savvy business owner you probably know your market and competition, and they might not be doing as well as others out there might think. So how are they obtaining commercial finance leases that allow them to continue to move their companies forward?

The answer in one word - 'structuring ‘. What's that you say? It’s the term that the lease finance industry uses in Canada to make things happen - for you.

In simple terms it might mean that you might not be able to take advantage of all of the great advantages of equipment finance - things such as 100% financing, the financing of your taxes related to the asset, tailored payments, potential off balance sheet financing .. And on it goes. The benefits are endless.

But guess what, as we said, if your firm does have financial challenges there is still a lease finance transaction out there for you. Working with your best lessor choice will allow things such as a potential down payment, a shorter term to the transaction, etc to make your transaction happen - which is what it’s all about.

Your competitors are stampeding to their business asset financing of choice because they recognized the benefits, whether they are financing computers, software, plant assets, heavy machinery, you name it. Speak to a trusted, credible and experienced Canadian business financing advisor. It's now your turn to lead the charge to successful business finance in Canada.

Stan Prokop - founder of 7 Park Avenue Financial -


Originating business financing for Canadian companies , specializing in working capital, cash flow, asset based financing . In business 7 years - has completed in excess of 50 Million $$ of financing for Canadian corporations .Info re: Canadian business financing & contact details :


A Shortcut To Leasing Equipment And Business Finance Lease Solutions & Services In Canada

Isn't any shortcut in business better? As shortcut is of course a ‘method or procedure that reduces time or energy and still accomplishes something ‘. Is it just us but isn't any Canadian business financing shortcut absolute good thing, as well as an advantage over your competition?

We're going to cover off some great shortcuts for leasing equipment in Canada, and how the ability to get a business finance lease with the best rates, terms and structures becomes a financing services victory for your company.

Also, when you can add a host of other programs services and structuring that are uniquely suited to your business... well... clearly that’s a win.

Doesn't it make sense to know what you are looking for prior to going out to get it - that's our first shortcut tip - determine whether you need an off the shelf lease financing services solution, or whether a customized business leasing equpment solution is required . A simple way to achieve this shortcut is to focus on the 5 elements of a lease, and which ones need special attention for a finance lease based on your company circumstances.

What are those key elements - simply the term of the lease, the interest rate associated with your credit quality, the size of your transaction, the monthly payment your cash flow budget can afford, and finally the end of term option that again, best suits your firms needs.

That's a mouthful, but most Canadian business owners and financial managers don't realize they have the ability to influence, and in some cases negotiate some of the key five elements - thereby creating your shortcut to leasing equipment finance success.

Let's delve into that further. Let's assume you know the asset or equpment that you want - you've evaluated your requirements and want a financing services program that best suits your company.

Now its time to take work on getting the flexibility you need to maximize those financial advantages. They include of course full financing of your asset with minimal or no down payment, flexible monthly payments geared to your cash flow and working capital concerns, the ability to use off balance sheet financing if you need it , or even in many cases generate a positive cash flow by leasing back equipment you own already .

In many cases you can achieve a quick shortcut to lease financing approval by working with your lessor on a term that works for both of you - it has to be a win win situation. On your side you want to match payments to economic benefits of the asset you are financing... the lessor is more concerned with asset value deterioration and your overall all credit worthiness.

If you are generally familiar with the finance lease business and leasing equipment industry in Canada you know it consists of a multitude of players , they all have different ownership , some foreign, they have different asset needs, and their pricing they provide you with is based on , guess what, their own borrowing practices !

The shortcut to best pricing and best structure is therefore knowing what leasing finance firm has the best appetite and expertise to provide you with a business finance approval that works .

In summary, if you want to achieve shortcuts in business financing services related to leasing equipment you would do well to speak to a trusted, credible and experienced Canadian business financing advisor who knows the business and will accelerate the shortcut to best asset financing you can hope to achieve .

Stan Prokop - founder of 7 Park Avenue Financial -

Originating business financing for Canadian companies , specializing in working capital, cash flow, asset based financing . In business 7 years - has completed in excess of 50 Million $$ of financing for Canadian corporations .Info re: Canadian business financing & contact details :


Friday, April 29, 2011

Canadian Franchisee Loans & Business Funding – 4 Secrets To Financing A Franchise

The inside edge. You want it, we have it! Have we got some tips and secrets to share for you.

We're talking about financing your franchise - the successful completion of your entrepreneurial dream in Canada. As a franchisee you want to be aware of your options in loans and funding programs that are geared specifically to financing a start up business in the booming franchise industry.

We're going to discuss 4 key elements of a proven formula for franchise success. What are they? Simply speaking its ensuring you have a business plan that accurately resembles the financial aspects of your business. Number two is the types of emphasis that is put on your own personal background and credit history. Number 3 is the knowledge of franchise financing options in Canada , and number 4, ( often # 1 in your mind probably .) the amount of personal funds you have to commit or invest to get your business going and your franchisee funding approved .

Let's dig in! OPM. What is it? It's stands for other peoples money and its critical you understand that a franchise is composed of two elements with respect to your financing plan - debt ( what your borrow ) and equity ( what you put in ). Our key point here is simply that while there is no proper mix of what works for the combination of those two elements. No franchise is financed with 100% borrowed funds - conversely you don’t want to ' pay cash ' for your business and risk all, or a lot of everything you own (house, savings, etc) for a start up business such as a franchise.

We will also share with you that some of the very specialized franchisee loan program in Canada typically require a 30 - 40% owner equity, or down payment. That can be achieved in several different ways.

Should you tap into your retirement plans to fund your franchise? That’s not our call, but if you have capital outside your savings we would not recommend collapsing RRSP’s, or taking out home mortgages, etc for the purpose of financing and funding your franchise.

Clients often ask how their personal credit history affects their ability to get franchise financing. In general we can say it’s a key point in the whole approval process. Many Canadians aren’t aware that the entire credit history system in Canada is based on a simple score. You should have a score of at least 650 to be successful in traditional franchise finance. So check your score in advance. And by the way, higher is better!

The business plan is a key element of your whole package. Many clients don’t have experience or financial acumen to prepare a proper plan. Not a problem as you can seek a Canadian business financing advisor, or accountant, etc to prepare your plan. A good basic plan comes at a very reasonable cost.

The business plan is your ' total picture ‘of your franchise. Basic elements are yourself, your background and business or industry experience, info on your franchise, and some basic financial projections. Naturally the better recognized and successful your brand the more attractive your perceived chances of success are.

As a franchisee what loans and funding is available in Canada. As unbelievable as it may seem the government of Canada, via Industry Canada, is one of the largest players in your franchise success. A program called the BIL / CSBF program is hugely popular and finances mot franchises fewer than 350k in Canada. We strongly recommend you seek out and investigate this program, it’s probably the key to 95% our client’s success in financing a franchise with funding that comes with great rates, terms and structures and limited guarantees. Bottom line, check it out!

So there you have it, 4 key elements, and secrets if you will, to franchisee financing success. Summarized... a solid business plan, some good business or industry experience coupled with a reasonable personal credit history, a down payment that is aligned to your overall financing needs and personal situation, and , last but not least, knowledge of programs such as the BIL which are geared toward franchise finance success .

So now you know!

P.S. Good luck in your entrepreneurial dream, and going it alone is never good, so seek the services of a experienced , credible and trusted Canadian business financing advisor .

Stan Prokop - founder of 7 Park Avenue Financial -


Originating business financing for Canadian companies , specializing in working capital, cash flow, asset based financing . In business 7 years - has completed in excess of 50 Million $$ of financing for Canadian corporations .Info re: Canadian business financing & contact details :


Thursday, April 28, 2011

Canadian Business Line Of Credit News - Must Know Info on Non - Bank ABL Financing and A Credit Revolver Loan

Are you totally on top of the newest trend in Canadian business financing these days? Then of course you're fully aware are knowledgeable on ABL Financing for a business credit revolver loan versus the alternative... a bank line of operating credit.

What's that ? You're not? No problem... read on!

No Canadian business owner or financial manager these days disputes with us the challenges of obtaining what everyone seems to call ' traditional bank financing. For all the right reasons (probably ... hopefully?!) Canadian banks hunkered down and tightened the lending strings a bit after the 2008-2009 financial debacle.

Therefore it’s not hard to determine how various specialized funds and independent finance firms came to a high level of prominence by offering ABL financing. A = Asset B= Based L = Loan .. It’s as simple as that.

Do you recognize any parts of the following story ... we think you will. You feel as if you had hit an impasse in expanding your firm. Personal funds have been depleted and your efforts to find that elusive ' traditional ' financing have failed. Additionally your firm might have some real challenges in perhaps returning to profit after you industry has been out of favor with those people in the glass towers that seem to know everything...

Is there really a viable solution to that business financing challenge, i.e. a real world alternative to a bank line and credit revolver loan? Enter asset based financing and asset based lines of credit!

Depending on the size of your facility and the overall financial condition of your firm the cost of ABL financing will either be lower, competitive, or higher than your current finance arrangements. ‘Thanks a lot ' we can hear you say, as that sure wasn’t very informing in nature! But we stand by that comment because of the complexity involved in assessing the size of your financing requirements, the overall credit worthiness of your company, and the mix of financing you need when it comes to ABL financing . The bottom line is simply that every situation is unique and needs to be addressed in that manner.

The essence of our message is hopefully clear - you do have a Canadian business financing alternative, and its a non bank revolving credit revolver , via an independent firm that provides you with very high liquidity rations on key assets such as receivables, inventory, and in many cases fixed assets and a/r.

Do we qualify? is question number 1 or 2 more often and not from clients . The answer in the ABL financing world is that everyone qualifies with only one criteria being required - you have business assets! because that’s what an ABL financing credit revolver is all about . And , as we said, it might be more expensive, and due diligence on your operations and assets might be a bit more rigorous ( in fact it will be for sure - ABL lending focuses on assets , not ratios !).

Whats happening in the Canadian ABL loan marketplace. Lots. Billions of dollars of financing is being accessed everyday by your competitors who are knowledgeable abut this new type of Canadian business financing. And it’s sure cheaper than bringing in additional equity, if in fact that could be arranged.

Interested? Intrigued? Want to know more? Speak to an experienced, trusted, and credible Canadian business financing advisor for the scoop on an ABL loan versus bank line. We guarantee you will be glad you did.

Stan Prokop - founder of 7 Park Avenue Financial -


Originating business financing for Canadian companies , specializing in working capital, cash flow, asset based financing . In business 7 years - has completed in excess of 50 Million $$ of financing for Canadian corporations .Info re: Canadian business financing & contact details :


Wednesday, April 27, 2011

The ‘ 411 ‘ On Working Capital Finance In Canada - Cash Financing Loans And Solutions

You're a Canadian business owner or financial manager... you've just dialed ' 411' for info on working capital financing! What alternatives, types of loans and cash flow financing are available for your firm?

Let's discuss your question, with a focus on ' solutions ‘! Before getting to our answer let’s all agree it’s important to understand the question and subject. Our terms of reference are simple today - operating liquidity - it's the other half of working capital, balanced also by your fixed assets as part of your total equity structure.

But enough finance and accounting lingo... as a business owner you well know that you have have lots of sales, assets, and still be struggling everyday to meet your current obligations of payables, salaries and wages, lease and loan payments, etc. I

If you weren’t struggling you've solved your working capital and cash flow challenges, but we're assuming you haven’t, that’s why you're here.

If you have access to bank credit ( many small and medium size firms either don't , or don't have enough ) you r banker defines positive working capital finance as the difference between your cash , receivables, and inventory subtracted from your payables and other short term obligations .

But can a firm or business have negative working capital... actually yes. If you are a retail oriented business, or have very short credit terms and turn inventory and sales quickly you actually are winning, not losing. You have negative working capital but have won the cash flow game... essentially you collect quicker than you owe, so to speak.

We encounter many clients that have retail or service oriented businesses but still have cash flow challenges, mostly around growth. A unique new working capital loan solution called the Merchant Cash Advance small business loan is a great way to solve that cash flow financing challenge - so check it out.

What are the solutions to the management though of positive working capital - its a bit of a misnomer because when you think about it the more positive working capital you have ( i.e. inventory and receivables are growing ) the more cash strapped you are

The more common solution clients consider is simply ' bank credit ' - i.e. traditional financing. If you want to know if you qualify for bank financing for operating lines of credit financing you should ensure your firm is profitable, is perceived as stable and growing .. and your balance sheet ratios should be in order . Thousands of firms cant meet those fairly simply tests. Whats the solution?

If your cash conversion cycle (the time it takes a dollar to flow through your company) is high you need a working capital facility that finances both your inventory and A/R. For large firms an asset based line of credit is a working capital operating loan that makes total sense. The majority of these types of facilities are non bank in nature, and offered by specialized finance firms that specialize in cash flow solutions. Oh, and by the way, a lot of those ' bank requirements' we spoke of don’t apply when you consider an asset based line of credit - Why... simply because the focus is on your assets - inventory, receivables, and in some cases your ability to borrow against fixed assets.

The main offerings of Canadian working capital financing are asset based lines of credit, inventory and A/R working capital facilities, as well as receivable financing, augmented in some cases by purchase order or inventory financing. These solutions typically are outside of bank financing, come with a higher cost, but provide thousands of Canadian firms with all the financing they need to grow sales and profits . If utilized properly you have the ability to significantly reduce the costs associated with these types of financing.

So whats our bottom line advice on the information you asked for on working capital and solutions available in the Canadian marketplace. Simply that you need to understand your firms unique operating and cash flow requirements, you have to be able to have some sort of measurement on whether you are winning or losing (the cash conversion cycle formula works best - check it out) and finally you need to be able to seek out and work with a trusted, experienced and credible Canadian business financing advisor to keep you falling off the slippery slope of working capital financial pressures.

Stan Prokop - founder of 7 Park Avenue Financial -

Originating business financing for Canadian companies , specializing in working capital, cash flow, asset based financing . In business 7 years - has completed in excess of 50 Million $$ of financing for Canadian corporations .Info re: Canadian business financing & contact details :


Tuesday, April 26, 2011

Commercial Mortgage Financing Canada

Commercial mortgage financing in Canada was exceedingly difficult to obtain based on the rates, terms, and structures that were sought for by Canadian business owners and financial managers. The 2008 and 2008 worldwide liquidity crisis clearly dampened commercial real estate lending in Canada.

Let’s focus on the commercial mortgage financing for Canadian firms who wish to either purchase property for new locations or expansion, or in some cases re financing current property based on existing company needs for working capital, etc.

Commercial mortgage financing in Canada is somewhat fragmented based on financing done in this sector of Canadian business. In our opinion current the best financing available for commercial first and second mortgages lies with a handful of select institutions who offer competitive rates and higher L T V. LTV is of course the acronym for loan to value, which specifies that per centage of financing your firm can obtain based on the value of the building / property .

When we meet with business owners to discuss why they are looking to either finance or re finance a facility the basic needs are as follows:

- Purchase a property that is currently leased
- Make significant improvements to a currently owned facility
- Re- finance a first mortgage that is coming due
- Acquire a commercial 2nd mortgage for additional working capital purposes

The general rule of thumb for Canadian commercial mortgages has been 65% Loan to value. As we discussed above that implies that if your are purchasing or re financing a one million dollar building you should be able to obtain financing in the amount of $650.000.00.

That obviously puts the onus on the borrower, your firm, to come up with a combination of equity and down payment that allows you to finalize the financing.

So is that the best deal that a Canadian firm can currently achieve in the 2010 financial environment? Absolutely not – there are a number of situations that allow your firm to get in some cases up to 90% and 100% financing on a building.

This is achieved primarily through government related programs that are generally not known to the average Canadian business owner or financial manager.

Our clients often ask us ‘how long will it take to put a commercial mortgage financing in place, and what is involved ‘. In our experience, with the full co operation of our customer it generally takes 30 -45 days. That of course necessitates planning in advance, especially if you are under some sort of deadline such as a renewal notice, etc.

We encourage Canadian business owners who are looking for commercial mortgage financing for a variety of purposes to ensure they have a clear and positive story in place. Our practice has been to sit down with a client, clearly reference the need and best solution, and we then put a clear package in place demonstrating the viability of the financing. That includes a combination of business and financial documents such as a summary of the business, the financials, and most importantly a cash flow analysis. We want to be able to clearly demonstrate that either the first, second, or both mortgages (if that is the solution required) can be repaid over time.

Commercial Mortgage Financing in Canada – challenging? Yes! Achievable ? Absolutely ! Work with a trusted , experienced and credible advisor who will allow you to achieve your goals and needs in this area of Canadian business financing .

Stan Prokop - founder of 7 Park Avenue Financial -


Originating business financing for Canadian companies , specializing in working capital, cash flow, asset based financing . In business 7 years - has completed in excess of 50 Million $$ of financing for Canadian corporations .Info re: Canadian business financing & contact details - tel 905 829 2653

How To Work With The Best Canadian Leasing Companies In Business Financing and Financial Services ?

As a business owner you love informed choices. When you are looking for asset acquisition via equipment financing you need leasing companies and business financial services advice on the best way to achieve finance success - and that requires being informed on equipment leasing.

So whats the scoop on the current equipment finance situation in Canada? Most business owners know that the ability to achieve the business financing you need became extremely difficult over the last couple years. Leasing companies were affected just like others - in fact many companies disappeared, were bought up, and most importantly, lost critical sources of their own funding - the bottom line..? They were looking for financing just like you!

The good news. You may have even seen the commercials ' Leasing is back!’. Those commercial refer to auto leasing, we're talking today about fixed asset financing for your Canadian company - and that includes everything from machinery to technology to heavy equipment, software, office equipment, you name it .. Our last transaction was for school buses..!

So, if leasing companies are back, let's just ensure you have a solid understanding of the benefits of lease business financing and, more importantly, who you should be working with.

Asset Financial services via leasing is simple - its a ' loan ' in which your leasing company purchases the equipment for you ( or from you.. via n equipment lease back ) and then of course leases it back to you at a monthly rate for a specific period .

Is it appropriate for your firm? Thousands of companies utilize this form of business financing everyday, in fact stats show over 80%! Another great thing about the best leasing companies in Canada is simply their ability to finance any asset for firms of any size, including start up.

The best Canadian leasing companies tend to differentiate themselves by the customer market they tend to specialize in - In Canada the industry is dominated by captive finance companies ( firms which lease only their parent company products and services ) as well as segments devoted to small ticket, mid ticket and large ticket asset financing.

We have always felt that the best firms provide quick turnaround on approval that seems to be a key focus for many clients looking for quick approvals for their asset finance needs. So ensure you understand the approval process, which typically is just an application, and, if the size of the transaction requires, your firm’s financial statements which are revived for only purpose - ensuring you have the ability to pay back the lease!

Your best leasing companies in Canada will ensure you understand the cost of financing. That cost is a mystery to many business owners and a frustration to even more. Buts it's really quite simple, it’s the interest rate inherent in the lease, as well as any purchase options or obligations at the end of the lease, and finally, any misc costs or admin costs identified in your transaction.

So how do you find the best leasing companies in financial services in Canada? We recommend that you seek the help of at trusted, credible and experience Canadian business financing advisor in business financial services. That will allow you to get a competitive quote, as well as achieving the best structure to your deal . He or she has solid intimate knowledge of the equipment lease industry in Canada and therefore has the ability to generate savings based on overall rate, term and structure of your transaction.

Stan Prokop - founder of 7 Park Avenue Financial -


Originating business financing for Canadian companies , specializing in working capital, cash flow, asset based financing . In business 7 years - has completed in excess of 50 Million $$ of financing for Canadian corporations .Info re: Canadian business financing & contact details :


Monday, April 25, 2011

Pick The Best Canadian Receivables Factoring and Financing ! Cost and Rates Of Invoice Finance

We encountered a great term the other day when it comes to business financing - the term was ' expansionary finance ‘. Is it just us or does this term seem to perfectly cover off factoring and receivables financing.

Often though three key issues come up when Canadian business owners and financial managers consider this type of financing. What are those 3 issues ?They are the total cost of this type of financing, the rates associated with this facility, and probably most importantly what type of firm offers the best facility to match your company's own specific needs .

Let's learn and cover off those issues, which will allow you to get more comfortable we think with this type of Canadian business financing.

So, why should you even be considering receivables factoring? Simply because it has become a common way for Canadian business to cash flow their accounts receivable and generate working capital based on your own policy of extending credit terms to your customers.

And, as most business owners know, sales does not equal cash flow and when business financing of your A/R is not available from your bank a logical place to turn to is to an independent finance firm that offers invoice financing.

But, what does this type of financing cost, and who offers it, and an even better question... ‘How do you pick the best factoring partner?

In Canada the financing and factoring of A/R varies widely. As a general rule we can say the cost is between 1-3% per month based on the size of the facility, your overall financial condition, and most importantly, whether you have sought out and picked the finance firm that best suits your needs.

Let’s clarify our comment on your overall financial condition. Receivable financing places much less emphasis on your firms overall financial health - in fact a huge amount of Canadian firms that utilize this type of financing are in stages of turn around, high growth, experiencing temporary financial losses, etc . So don’t despair that your firm isn’t eligible. But, as we said, your client base, the size of your A/R portfolio on a monthly basis and some other factors will dictate your overall pricing.

Frankly the best costs in factoring finance in Canada start to be achieved when your monthly financing capability for A/R is greater than 250k. Is there a ceiling on the amount of facility? Absolutely not, and facilities that go into the several millions of dollars on a monthly basis happen everyday in Canada.

Clients often ask our favorite most recommended type of facility. That’s a simple one - its called C I D - which stands for confidential invoice discounting, allowing you to be in total control of billing and collecting your own a/r without any notification to clients that comes with the U.S. and U.K.versions of a/r finance .

Remember also that when you are addressing the always top of the list issue with firms such as yourself, ' Cost ' that you need to factor in things you might never have thought about. They include your ability to grow your business and generate more profits simply because you now have the capital to do so, albeit at a higher cost. And couldn’t you offset some of the cost of factoring by taking discounts with your own suppliers (and improving relations with them along the way!), as well as purchasing more effectively with your new found working capital?

So , in summary , if you need a financing partner when you are considering a receivable management and financing solution seek out and speak to a trusted, credible and experienced Canadian business financing advisor who will ensure your cost and partnership with your factoring firm is focused on a mutually beneficial relationship for financing success .

Stan Prokop - founder of 7 Park Avenue Financial -

Originating business financing for Canadian companies , specializing in working capital, cash flow, asset based financing . In business 7 years - has completed in excess of 50 Million $$ of financing for Canadian corporations .Info re: Canadian business financing & contact details :


Saturday, April 23, 2011

Don’t Fail to Investigate Canada Government Grants and Loans – The Small Business Loan Program Works!

If you are either a start up (pre revenue) firm or an established small or medium (we’ll define medium a bit later) sized company in Canada you should be investigating, and using the Government of Canada small business loan program.

Why? We will give you 4 reasons - Great terms, rates, structures and qualification criteria. Could you ask for anything better in Canadian business financing - we don’t think so and we have been a fan of the program now for years.

Many clients or callers requesting information on the program (the formal name is BIL / CSBF) often utilize the terms ' grants ' when requesting info on the program. The BIL /CSBF program is not a grant. It is a special business financing program sponsored by Industry Canada (those good folks in Ottawa ....). The program was developed by the government to assist the thousands of firms who might not qualify for what the finance folks call ' traditional financing ' - aka ' the bank!”.

We also promised you we would qualify the term ' medium sized firm ' when it comes to qualifying for the program .In the case of the Small Business loan program any firm under 5 Million dollars in either actual or projected revenue still qualifies for the program . Naturally your firm has to be privately owned, and be considered a ' for profit ' business. (We’re all ' for profit ‘!)

As we said, many customers call looking for ' grants ' - we're all for free grant money also - we are sure it exists out there somewhere, we just have never found it. Actually, let’s clarify that, two great programs, S R ED, and film tax credits are non repayable credits you can easily apply for if you qualify for either of those credits .Those two programs are a discussion for another day though.

Typical client questions always include - how much can we get or apply for??... What are the rates and terms? and whats the process involved ? Get ready for a short, simply and basic primer in all those three areas!

The Canada government small business loan has a maximum cap of 350,000.00 dollars. However, if you chose to use this financing for real estate you can actually receive 500k. We note that for many years the program had a cap of 250k and during the global recession (2008-2009) the government raised the limit on the program.

Many firms who are either new or have challenges might think the rates and structures are onerous under the program. Exactly the opposite... financing is at only 3% over prime, and from a term perspective you can go from 5 - 7 years, we typically structure 5 years as a reasonable term.

Penalties to pay back if you're successful - There are none!!

There isn’t a day when we don’t spend time advising clients on what can be financed under the program... that’s where a lot of mis information exists. The program only covers equipment, leaseholds and real estate. We would add that software is included in the equipment category.

So who is using the program - Almost 8000 businesses did in 2010 - so you can be sure that the program works and is robust.

The greatest challenge around the program in our opinion has been the confusion on where and how to apply. We've completed transactions in a week and then heard from clients that they have spent months floundering on their processes in this type of financing. Speaking to a trusted, credible and experienced Canadian business financing advisor in the area of government small business loans will get you on the fast track to some of the best financing available in Canada today.

Stan Prokop - founder of 7 Park Avenue Financial -


Originating business financing for Canadian companies , specializing in working capital, cash flow, asset based financing . In business 7 years - has completed in excess of 50 Million $$ of financing for Canadian corporations .Info re: Canadian business financing & contact details :


Not Getting The Best Canadian Equipment Lease Interest Rates in Commercial Leasing ?

Looking for the best deal in town on Equipment lease rates in commercial leasing asset acquisition ? Our clients ' interest ‘in getting those best rates is always somewhat amusing to us. Why? Simply because the ability to understand how lease pricing is derived is not always clear to Canadian business owners and financial managers.

Lets examine some of the key factors that drive your final pricing and how you can have a very direct effect on the assets you finance and the price you pay - as always it seems to always come down to that ' monthly payment ' - so lets demystify that process .

First of all many business owners never take the time to look at their alternatives when it comes to equipment leasing of their fixed assets. Two key issues come into play here, one is simply they type of lease they enter into (there are two types - do you know which is which) and the second is understanding what the 5 (yes five!) components are of a very simple lease calculation.
Back to point # 1: When you are making that lease versus buy decision make sure you evaluate your alternatives.

The key alternative to lease finance is one in which you might consider a bank term loan, or alternatively purchasing the asset out of your operating cash flow based on existing credit lines that are in place. But quite frankly the reason you are reading this in the first place is that you have already decided that commercial equipment lease financing is in fact the best method of asset acquisition - at this point you just want a good deal . So we're assuming you have done your lease vs. buy analysis and are focused on our core subject today - a great lease rate and structure!

Getting back to those 5 key elements in lease financing pricing - what are they? They are simply as follows - the term of your lease, the interest rate being charged by the lessor, the value of your transaction, the future value of the lease, ( i.e. what happens at the last payment ) and out of that falls nicely # 5 - your monthly payment .

Many business owners, and are we say, financial managers don’t use a financial calculator. If you have access to that type of calculator you can simply input either your data, or assumptions on any of those 4 critical data points and out will pop the last piece of data that completes the commercial leasing pricing and structure.

Quick example - lets say you are leasing an asset for $100,000 - you want a 5 year lease, you think your lease interest rate should be about 8%, and you want to own the equipment at the end of the lease. Congratulations, you have just quantified 4 out of the 5 data points - Enter those into your lease calculator and you will see that the monthly payment is 2014$.

But wait, let’s say you can only afford 1500$ a month and you have done your analysis on the payback of the asset. Enter 1500$ into your lease calculator and it will show you that to achieve that lease payment the term must be 88 monthly, not 60 months .
Getting the point - its a simple one - understand that if you know the key elements of your lease inputs you can manipulate that info to achieve either the best rate, the best monthly payment, the optimal term of the lease, etc .

The type of analysis we have just done relates to a capital lease transaction - remember we spoke of two types of leases. If you want an operating lease (i.e. use, but not ownership of the asset) our data elements are just the same but you'll find that your overall interest rate on the amount financed will be much lower, because the lessor and you have opted to have the lease company own the asset.

Do we even have to mention that the key driver in the actual interest rate charged is very simply the overall credit quality of your firm when it comes to borrowing.

So what have we covered - simply that you have the ability to manipulate key lease elements to drive a final pricing and structure that works best for your firm. Is there a quicker way to ensure you have all the points covered - there is! Speak to a trusted, credible and experienced Canadian lease financing advisor who can ensure you the final deal is the best deal in commercial equipment leasing in Canada.

Stan Prokop - founder of 7 Park Avenue Financial -


Originating business financing for Canadian companies , specializing in working capital, cash flow, asset based financing . In business 7 years - has completed in excess of 50 Million $$ of financing for Canadian corporations .Info re: Canadian business financing & contact details :


Friday, April 22, 2011

Going It Alone In Canadian Franchise Loan Financing ? Business Franchising Loans

Don’t listen to them. Many will of course tell you it might be dangerous to ' go it alone ' when you are looking for franchising financing loans.

Can you actually get a business franchise loan without any outside help? Its certainly , possible , and we'll share some advice, tips, strategies and info around your potential do it yourself strategy - but we'll also demonstrate why some professional assistance along the way will ensure the success you are looking for in your franchise business acquisition .

There are of course some real potential pitfalls along the way on your road to franchising success. You want to be sure of course, to the extent that you can be, that your business will be profitable. But all business is of course a risk, whether it’s General Motors or your vision of your own service or restaurant business as an example. It is critical to make the most of the opportunities you have to examine profit potential. Those profits by the way are of course what pay back those franchise finance loans!

Along the way on your franchise journey you have numerous methods of determining financial success. A good start is looking closely at your franchisors prospectus and information, - even though that info might be for ' average ‘ franchisees it gives you a good sense of profit potential versus risk .

Don’t forget of course that your risk is that you are no only borrowing funds for the franchise but that your own personal equity injection into the business is a key part of the overall franchise financing package you will eventually come up with . So work to minimize the risk of franchise business failure.

Get your costs in order and understood. That’s some of the best advice we can provide. We advise clients to look at the total picture, which includes soft costs and hard costs, some of which can be financed, not all. Typically we recommend your owner equity be used to cover those ' soft costs' such as the franchise fee, etc.

Try also to match revenues with expenses - it might make perfect sense to lease some of those ' hard assets ' in the franchise to match the economic benefits you will receive from those assets with the useful economic life of the asset. Want a simple explanation of that? Example: If you're starting a restaurant and a large fridge or cooler is, say 75,000.00 doesn’t it make sense to finance that at say 2k per month on a lease as opposed to using valuable equity and working capital and paying cash. We think so. Wouldn’t you?

So how are franchises actually financing in Canada. We focus on a total package that might include a franchise term loan, a working capital loan, and the appropriate amount of external financing through a financial vehicle such as an equipment lease. Here's the big surprise in Canadian franchise loan financing - simply that the majority of franchises are financed with the government loan program called the BIL / CSBF program. By the way, it has incredible rates, terms, structures, and a limited personal guarantee. What more could you ask for.

So, in summary, is it possible to go it alone in Canadian business franchising financing? It is, but a better solution might be to work with a trusted, credible and experienced Canadian business finance advisor who will craft your package according to financial available and your particular situation and needs. Going it alone, but with a suitable partner when needed is a good thing sometimes!

Stan Prokop - founder of 7 Park Avenue Financial -


Originating business financing for Canadian companies , specializing in working capital, cash flow, asset based financing . In business 7 years - has completed in excess of 50 Million $$ of financing for Canadian corporations .Info re: Canadian business financing & contact details :


Thursday, April 21, 2011

Use Canadian Film Tax Credit Policy for Successful Financing of Film , TV , And Animation Projects

We can forgive non Canadian producers for not being up to date on Canadian film tax credit policy or the financing mechanisms available around film tax credit scenarios in Canada.

It's a little difficult to stay up to date on whets happening in the U.S., the U.K. and other parts of the world as it relates to the film tax credit part of the entertainment industry - that involves of course film, TV, and the last, but not least, rapidly growing digital animation industry.

But let's be clear on this - the film tax credit and its related credits are a major incentive to any producer planning to shoot or product a film television and animated feature in Canada . There is not a day when we dont receive a call from U.S. folks inquiring about the credit. (The key tax credit in question is called The Canadian Film and Video Production Services Tax Credit)

Similar to its foreign counterparts at it's simplest we can just say it’s a major incentive to growth film TV and animation production in Canada. It’s a financial incentive; it’s as simple as that.

Prior to current systems and governance there was a perception that the tax credit application and funding system was cumbersome. We feel very comfortable in saying that feeling has gone away to the point where applications are actually submitted online.

The Canadian film tax credit is a refundable, non repayable credit that can play a very significant role in the overall financing of your project. Books are written around the challenges that independent producers face in putting together a complete financing package for their project. And don't even talk to us about the timelines involved in film finance!

But, imagine this, receiving anywhere from 30-45%, or more of your entire financing via the ultimate receipt, or monetization of your film tax credit. Haven’t we just taken a huge piece of your financing challenge and workload away? The credits are heavily focused on labor expenditures; naturally the feds feel that employment in the industry is a very positive identifier for the program success.

We've referenced a number of times here the monetization of your film tax credit. Using the tax credit policy as a financing mechanism can help you cash flow your project and provide a decent part of the overall working capital you need. Tax credit film financing is a boutique industry in Canada, only a small number of players, and pricing and structures vary. A very small handful of Canada’s largest chartered banks have boutique divisions that focus on this type of financing if you can meet general bank criteria. An even smaller number of firms finance the tax credits outside the bank.

So do we have anything against U.S. or other film tax jurisdictions? Absolutely not, but check into the Canadian scene in this area and we are positive it might be a driving factor in your decision to film or produce in Canada.

Seek a credible, trusted, and experienced Canadian business financing advisor in this area to help you put together a core team around the application, approval and monetizing of your credit.

Stan Prokop is founder 7 Park Avenue Financial ; see


Originating financing for Canadian companies,specializing: working capital, cash flow, and asset based financing , the 7 year old firm has completed in excess of 50 Million $ of financing for companies . For info / free consultation on Canadian business financing / contact details see:


Finance Challenges ? Why An ABL Lender Has Your Canadian Financing Challenge Solved ! An Asset Lending Loan

Seems strange, don’t you think ? That the same type of financing that could be a solution for taking your company out of special loans might be the same one that can handle your growth financing needs ?

We are talking about ABL - the finance acronym for ' asset based lending ‘. ABL lending is a powerful financing loan (not really a loan per se) but we will get back to that) offered by a unique type of lender in the Canadian marketplace.

How unique are those lenders - we think very! And we're going to demonstrate why, right about now!

ABL lending and financing is a financing facility that is set up to monetize or cash flow your assets. The closest comparison we can offer you to this type of financing is that it is comparable to a Canadian chartered bank operating line of credit and financing facility. But boy are they different.

Your ABL lender sets up a monetization of all your business assets, but typically the key assets are receivables, inventory, and occasionally complimented by equipment and real estate if those latter two are applicable. We can hear you already, because we have heard it from clients a thousand times ' But why is that different from a bank line of credit?"

The answer is simply, the total focus and amount of the facility is actually based on your total assets, and their current values. Bank operating lines on the other hand are pre set limits that are significantly focused on financial ratio, loan covenants, tangible net worth, and outside guarantees and equity. What a difference, right?

So is ABL lending better? Ours is to inform, yours is to decide - but abl financing optimizes the amount of financing you can achieve to the max. It is set up as a base of all your assets, with yourself drawing against those assets on a daily basis. That of course matches perfectly the needs of your company, i.e. the daily inflows , outflows, special bulge needs, large new contracts, overcoming slow collection challenges, etc .

Because the abl solution is always focused on your total asset picture it in effect optimizes your total available working capital. We think you're getting the picture. And getting back to that always comparison against a chartered bank facility your borrowings on a daily basis are managed much in the same way - you use those same established ' borrowing base certificates ' that allow you to drawn down on cash flow and working capital on an ongoing basis.

The bottom line -as sales grow and you generate receivable sand inventory your abl loan financing fluctuates to turn your company into a true cash flow machine.

Some of the key issues you need to address in choosing the ' perfect ' ABL lender are as follows - the size of the facility, what information is required of your firm to set up the facility ( appraisals and operating audits are required ) , the timeline to set up the facility ( typically 2- 7 weeks depending on size and your reporting capability ) and issues such as cost and ongoing reporting and monitoring .

In the U.S. stats show that almost 30% of firms use some form of abl lending and loan financing to finance their firms. We are pretty sure the numbers in Canada are lower, but we sure do think you should determine if this type of financing is your total solution to business finance challenges. Speak to a trusted, credible and experienced Canadian business financing advisor about solving your cash flow challenges - today!

Stan Prokop - founder of 7 Park Avenue Financial -


Originating business financing for Canadian companies , specializing in working capital, cash flow, asset based financing . In business 7 years - has completed in excess of 50 Million $$ of financing for Canadian corporations .Info re: Canadian business financing & contact details :


Wednesday, April 20, 2011

Looking For Working Capital And Business Capital In Canada ? Commercial Lending Isn’t What You Think

Having a closed mind on achieving working capital and business capital financing via commercial lending just might not be the best thing .

Let's focus in on working capital financing and talk specifically about the type of cash flow solution that might best suit your business - which you haven’t even considered!

No one is disagreeing with you that Canadian business financing solutions aren’t difficult to achieve, yet alone envision. By itself working capital and cash flow financing is more unsecured from a finance firm or lenders position. So exactly how do you go about financing your business and determining what, in today’s challenging environment ( post 2008-2009 ) are the best solutions for business capital?

When you think about it, its really all about your cash cycle, how funds flow through your business and historically how your business has operated with this ' cash cycle ' in mind . Every business, or rather industry, seems to have a little bit of its own nuances.

And if you are a service focused business then the receivables you generated pose an even more of a required focus as we need to determine how you will use working capital financing to finance business operations. That is not to say that service type businesses cant be financed, it just becomes a question of securing financing that meets your specific needs - as the financial folks would say , you business is not capital or asset intensive - yet you still require cash flow financing - as your sales grow your receivables and operational needs grow also.

So let’s get to the nub of our discussion, what are the solutions available for working capital in the current Canadian commercial lending environment?

If you are more of a service business ( i.e. not capital intensive - example = mfg ) and can demonstrate on going recurring sales and receivables you are a prime candidate for a receivable financing facility . Our favorite and in fact recommending is a confidential invoice discounting/financing facility. This type of commercial lending facility is generally available through what we call non banks - i.e. private independent finance companies. It allows you to generate cash flow and working capital as you generate sales, and you can then focus on meeting your obligations of staffing and operations prior to collecting from clients. You also do this on a confidential basis, i.e. there is no notification to your client basis, as is the case with more traditional receivable financing.

Firms that are more asset intensive need to consider ABL facilities ( asset based lending ) that provide a combo of inventory, a/r and equipment financing that is margined ( on a daily basis !) to give you all the cash flow and business capital you need . Canadian businesses know only too well that lengthy collection periods can become the death of their business.

Also in many cases the amount of receivable financing you need simply isn’t always available from Canadian chartered banks - we meet many clients who have some commercial lending from banks, but it never seems to be enough when you are in growth mode or experiencing some sort of other business challenge. This then forces the Canadian business owner and financial manager to assess options that you don’t necessarily have to consider, i.e. getting in additional equity and diluting your ownership.

In summary , yes we agree its complicated - term loans, asset based loans, invoice discounting facilities, unsecured cash flow financing ... a lot of considerations . And which one is truly best for your firm. As we've said it might not be as complicated as you think .Speak to a trusted credible and experienced Canadian business financing advisor to understand the best solution and the cost and ramifications of commercial lending that makes sense for your firm.

Stan Prokop - founder of 7 Park Avenue Financial -


Originating business financing for Canadian companies , specializing in working capital, cash flow, asset based financing . In business 7 years - has completed in excess of 50 Million $$ of financing for Canadian corporations .Info re: Canadian business financing & contact details :


Tuesday, April 19, 2011

The Best Tools and Resources for Equipment Finance and Asset Lease Success - A Canadian Leasing Equipment How To !

It's your call, but if your firm has ever experienced a challenged in purchasing an equipment asset it’s about time you understood the benefits and flexibility of equipment financing via a leasing strategy.

The reality is that for most Canadian firms not all benefits attached to leasing equipment will necessarily make sense for you, but your ability to capitalize and maximize on those benefits that do will save you potentially thousands of dollars.

Today’s business world is all about competition and your ability to acquire an asset lease allows you to win the battle against deprecation and obsolescence. Quite frankly though many firms actually acquire used equipment in a variety of asset categories and this part of equipment finance in Canada is a booming one. The recent 2008-2009 recession left a glut of assets in many industries such as printing, construction, etc.

When it comes to technology financing though new is probably better, and that’s where lease financing shines. When you consider the relatively short time span it takes to arrange such a lease it often becomes a true advantage over a loan or bank term loan scenario .

Clients often ask what the ' entry points ' are to leasing in Canada. Frankly assets from three thousand to the millions are leased everyday in Canada - the bottom line is that equipment finance doesn’t discriminate against size. Stats available in the U.S. and Canada suggest that over 80% of firm lease equipment at one time or another.

Is there one constant driver in the search for great asset lease solutions? We think that more often or not it’s limited capital. Clients seem to feel that the most efficient use of their working capital and cash flow is the ' driver ' for their search for leasing equipment options. And as we said, that goes from hi tech, to low tech, whether you are financing newest computer and software technology, or refurbishing plant and equipment or transportation ' rolling stock' type assets.

As a Canadian business owner your preference is for choices. Asset lease transactions provide you with those! Focusing on either the type of lease you are acquiring, the need for a specialized term (leases generally are available for terms of 24 months to 7 years - depending on the asset and your firms overall credit quality.

Many smaller and medium sized firms don't take advantage of operating leases when considering the equipment finance option. This strategy can lower your payments, perfectly match the use and term of the equipment to your needs, and create balance sheet and accounting enhancements that will allow you to acquire the latest technology without taking on long term debt.

And don’t forget our friend ' Bundling ‘. Do you know him? Most business owners don’t realize that a lot of soft costs around an asset lease transaction don’t need to be paid out in hard cash. They can be in effect ' bundled ' into a transaction - typically these items include maintenance, warranty, installation, delivery, training, etc. That’s true flexibility.

If you want to be on the cutting edge of asset acquisition in today’s competitive environment then speak to a trusted, credible and experienced Canadian business financing and leasing advisor who can ensure a structure and approval that makes sense can be completed in a timely manner to your firms advantage.

Stan Prokop - founder of 7 Park Avenue Financial -


Originating business financing for Canadian companies , specializing in working capital, cash flow, asset based financing . In business 7 years - has completed in excess of 50 Million $$ of financing for Canadian corporations .Info re: Canadian business financing & contact details :


Monday, April 18, 2011

Supersize Your Canadian Business Accounts Receivable Finance Success via Confidential Invoice Discounting Factoring

Surprised? Clients often are, when we tell them that they have the ability to ' super size ' their level of working capital and cash flow via a little known business accounts receivable finance strategy known as C I D - confidential invoice discounting or factoring .

What do we mean exactly by the reference to supersizing? Simply that it is highly possible that on utilization of this type of financing you will often double, in some cases triple your access to immediate cash flow and working capital. And in some cases where you would have been self financing or had non financing in place whatsoever, well, your firm has it now.

So what’s C I D - how does it work, what can we compare it to, what does it cost, and why is it so innovative. That’s a lot of questions, so let’s get to some basic answers.

C I D, as we stated is our terminology for confidential invoice discounting, more commonly also called factoring. This type of financing is used by firms of all sizes (even major corporations, by the way) but in reality seems to be more common in the S M E (small and medium enterprise sector). It even accommodates start ups if you can believe it, as any type of financing for a start up is often a major challenge for the business owner.

As a Canadian business owner in the business to business market you typically have a large investment in accounts receivable. But how do you finance that investment when traditional capital is not available, or the reality is that you dont qualify?

That's exactly where business accounts receivable invoicing and discounting comes in. Your ability to sell those invoices as you generate them, using the A/R as collateral allows your company to turn into an instant cash flow machine.

So that’s the essence of factoring, or invoice discounting, but where does our key benefit of confidentiality come in. Right about here! Because the key difference of C I D and business factoring is that you are in control of your sales ledger and customer base, not the factor firm. That’s where you immediately gain superiority over other firms who use this type of financing but are forced by their factoring agreement to make their customers aware of how they are financing their firm.

On a daily basis C I D work in the same manner as what we will call ' traditional ‘ accounts receivable finance and invoice discounting. It’s a simple process. You generate invoices for the products and services that your firm provides and you receive immediate same day funds for 90% of the invoice value. The remaining 10% is held back until you client pays, you then receive the 10% less a finance fee of anywhere from 1-2.5% per month.

Clearly the advantages of this type of business financing couldn’t be more pronounced - its quick financing, its easy to administer ( you bill and collect your own a/r) and you use that valuable working capital and cash flow you have just achieved to run your business on an operating basis .

So, does Confidential Invoice Discounting seem like the proper accounts receivable finance strategy for your firm? Ultimately you will decide that - we're simply letting you in on the secret and letting you be the decision maker around super sizing that cash flow. Speak to a trusted, credible and experienced Canadian business financing advisor on how this type of business financing can put you ahead of the pack!

Stan Prokop - founder of 7 Park Avenue Financial -


Originating business financing for Canadian companies , specializing in working capital, cash flow, asset based financing . In business 7 years - has completed in excess of 50 Million $$ of financing for Canadian corporations .Info re: Canadian business financing & contact details :


Sunday, April 17, 2011

Why Canadian Merchant Cash Advance And Business Credit Card Loan Facilities Are Popular forms OF Small Business Finance

There certainly aren’t countless options for small business, retailers, restaurants, etc for achieving working capital and business financing success in Canada
So let's discuss the new and up and coming kid on the block, who goes by a variety of creative names - including but not limited to : merchant cash advance , small business loan, and credit card advance sales loan.
What are these facilities, how do they work, and are they perhaps tailor made for your short and intermediate term cash flow and working capital needs.
The merchant cash advance became popular clearly as a result of businesses such as yours, probably retail in nature who have seen traditional sources of financing either disappear, and quite frankly perhaps weren’t even there in the first place!
While this form of financing is more expensive than traditional financing, as alternative financing goes, it does the trick, providing you with working capital and cash flow based on future sales.
And we can assure you that we spend a lot of time with clients carefully explaining that it’s not a loan per se that brings onerous debt on to your balance sheet. You are simply receiving an ' advance ' against future sales. Other commercial business makes sales, and then immediately finance their receivables to generate cash flow. In the case of your business, either a retail establishment or a restaurant ( basically any business that takes credit cards on a regular basis ) your are simple cash flowing those future sales, getting funds today, and repaying the advance via a percentage of future sales that you feel confident will be made .
Using a simple example, if you are advance , again just as a example here, $ 10,000.00 for your working capital needs a per cent age , typically 10 -30 per cent of future sales is used as a repayment of that advance your firm has just been provided with . Where this works best is if you have a solid credit card sales revenue model, and your have solid gross margins on your services, products, etc.
So is it a good idea for you firm? Well, certainly as we said, it’s a newer form of alternative financing. In most cases we see when discussing the options it is clear to all parties that traditional bank financing options have been fully exhausted. As we said, thousands of firms sell and finance their receivables - all you are doing is selling and financing a portion of your future sales - so for many it does make sense.

And by the way, it’s clearly a form of financing that is unsecured, because the collateral is in fact future sales that hopefully will materialize, but might not!

A good rule of thumb we use is that it’s an excellent short and intermediate finance strategy. Over the longer term you should be working on a long term strategy to probably finance your business.
A merchant cash advance business credit card loan is also very easy to achieve. The main focus is your ability to demonstrate your sales revenue via bank or credit card processing statements. Small business owners can expect of course to be a guarantor on this type of unsecured loan financing.
So, that’s the offering. If you are scrambling on a daily basis in a retail or restaurant type business environment speak to a trusted, credible an experienced Canadian business financing advisor about merchant cash flow advance financing.

Stan Prokop - founder of 7 Park Avenue Financial -


Originating business financing for Canadian companies , specializing in working capital, cash flow, asset based financing . In business 7 years - has completed in excess of 50 Million $$ of financing for Canadian corporations .Info re: Canadian business financing & contact details :


Canadian Business Loan Financing – Pain or Pleasure ? Mastering Finance Success With Equipment Lease Companies

You've been there before. Does this sound familiar? You need to acquire costly assets for your company and don't want to utilize your cash reserves of business operating credit to acquire asset financing.

Yes of course you could get a traditional term loan via your chartered bank, but if you are a small or medium sized business and unable to access term financing what are your available options? The answer is a business financing lease loan via Canadian equipment lease companies.

Why are some firms successful in both obtaining approval for their leased asset needs, and at the same time seemingly able to get the payments they want to sustain their cash flow and working capital.

Let's examine some key info, strategies, tips, and types of solutions available to Canadian business owners and financial managers.

You will find first of all, and this is a key driver in business financing and equipment leasing... that approval for your transaction is much easier to obtian than other types of asset finance. Most business owners don’t understand the very simple process involved in acquiring asset financing via equipment lease companies in Canada. To prove our point it’s simply a fact that in North America Billions, yes billions of dollars of assets are lease financed.

A typical approval process is simply a standard credit application, appropriate financial disclosure, and a copy of a quote or invoice from your chosen vendor. It's as simple as that. Naturally the larger the transaction size the more info you might have to provide re financial statements, etc.

Many businesses aren’t aware that a huge part of the equipment lease industry in Canada utilizes whats known as an ' app only ' approval process, with you as a business owner providing only a standard application, with most approvals done via automatic scoring, via the lessors ' point system ' criteria around your years in business , payment record to suppliers , etc.

You have truly mastered equipment lease business financing when you fully comprehend the fact that almost any asset, even some intangibles (i.e. software) can be financed. Its
when you make your lease and loan finance decision a part of your overall long term financing strategy that you suddenly realize that every asset that is both costly and depreciates probably makes sense in your overall lease financing strategy .

Successful lease finance lets you keep and grow your cash reserves, allowing you to survive against that constant battle with your competitors. One of the smartest things you can do is to develop relationships with equipment lease companies that will over a long term basis provide you with ongoing lease lines of credit for all your asset needs. The industry itself refers to this strategy as an ' evergreen ' scenario, one in which your firm is constantly refreshing its assets to generate sales and profits.

How many times have you felt that sales and profits are growing, you seem to be winning the competitive battle, but cash flow is a challenge due the to the heavy investment you have in assets such as receivables and inventory . That’s when business financing via a n equipment lease makes your overall success complete, as you retain that much needed operating cash flow for growth and sales, letting lease and loan finance hand the asset acquisition part of your growth plan .

Let's get one thing straight. The reason leasing companies in Canada exist is simply their own mandate to generate lease transactions! Criteria for approval is significantly different than a more traditional banking approach, with heavy emphasis placed on the asset as collateral, as well as its ability to generate profits and sales for your company . Many business owners are surprised to hear that even start ups or very young firms can generate significant lease financing approvals for assets they need to grow the business.

We've focused on issue such as approval, types of assets, and alternatives to traditional financing in looking at your relationship with equipment lease companies. But don’t forget also the other major benefits of this asset acquisition strategy, some of which may be more important than others to your firm. They include tax and balance sheet advantages, improving your ability to manage obsolescence in assets.

We can guarantee you that you'll only master and be successful in lease financing when you understand the make up of the Canadian equipment lease landscape. Knowing who to talk to and whats available will put you significant ahead of the pack. Speak to a trusted, credible and experience Canadian business financing advisor for assistance in dealing with equipment leasing companies to your advantage.

Stan Prokop - founder of 7 Park Avenue Financial -

Originating business financing for Canadian companies , specializing in working capital, cash flow, asset based financing . In business 7 years - has completed in excess of 50 Million $$ of financing for Canadian corporations .Info re: Canadian business financing & contact details :


New Ways To Achieve Accounts Receivable And Inventory Financing - The W/C Finance Loan Facility

Successful business owners and financial managers are always looking for a new... no wait, ' better ' way business financing success. No where that is more obvious than in the quest for accounts receivable and inventory financing, the actual monetization, if you will, of your balance sheet current asset accounts.

So we have dubbed the solution as W/C solution if you will . What's W/C - Why working capital of course, and a variety of ' flavours of this type of financing loan facility are available to your company. It's just that they are not well known - Until now!

Is it unique, or novel to be looking for way to raise cash flow and working capital out of your receivable and inventory investments? Absolutely not, its just that its become a lot more difficult in the past several years - and we're talking from the start up right up to major corporations - No one has been exempt from the pain challenge of raising working capital, that works!

So what sort of ' cash flow products ' if you will, are available? Many clients are skeptical that it is difficult, or impossible to generate a stand along inventory finance facility. There is some truth in their belief, in that the collateralization of your inventory is in many cases tied to the overall collateral that your company offers up, usually in the form of a blanket General Security Agreement given to your lender, in some cases Canadian chartered banks.

However the hard reality, even harsher since the 2008-2009 recession, is that inventory financing in Canada has been difficult to achieve.

So let’s cover off your options in this regard, one of them might well be the option you are looking for. At the top of our order is of course straightforward bank financing that is margined against your collateral, typically the A/R and inventory we mentioned. That’s probably optimal, but the requirements that come with that facility are significant, they are good financials, owner guarantees, strong operating performance... well you know the drill.

However, did you know that there are independent finance firms that offer a working capital facility along the same lines as that chartered banking arrangement we mentioned. The most valuable facility is the asset based loan, a financing arrangement that in many ways is similar to a bank deal, but significantly margins your inventory financing needs simply because real value and appraisals are made on your inventory. There are numerous situations where clients have been able to double, and even triple their overall working capital loan facility with this type of transaction.

A number of what we call ' second tier ' firms step in for many small and medium size transactions, for facilities that generally range from 250k - to 3 Million dollars. These facilities are more expensive, but again give you very solid borrowing power.

And back to our main theme, is it possible to achieve a pure inventory and contract financing in Canada. This solution is more expensive, but non bank in nature, and provides a method in which you suppliers are paid directly , with your rights in inventory and contracts being assigned to the lender an independent finance firm, somewhat boutique in nature . You are simply leverage the actual inventory prior to it being sold and generated into a true receivable, which of course itself can then be monetized.

So, whats our take away here? Pretty basic, yet giving you hope. Various forms of direct inventory, non bank financing, and contract and purchase order financing do exist in Canada. They are becoming more mainstream everyday. Intrigued? Got questions? Have a unique situation? Speak to a trusted, credible and experienced Canadian business financing advisor real world solutions to an inventory financing loan facility 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 50 Million $$ of financing for Canadian corporations .Info re: Canadian business financing & contact details :


Friday, April 15, 2011

Financing A Franchise In Canada ? Here Are Clear Finance Options For Approval From Lenders

Pretty well everyone agrees these days that the franchise option is one of the best ways to purchase and run a business. That's the easy thing we can all agree on... but what about financing a franchise and making sure you have a solid knowledge and assistance around finance options and who the lenders are in the Canadian marketplace.

Don't despair. Let's cover off some key basics, tips, strategies, and solutions around your decision to buy a franchise in Canada and become an entrepreneur in the true sense of the word.

After all the euphoria is over re: having made that decision to purchase a franchise a minor problem usually occurs - the cost, and how to finance that cost ?!

It's safe to say you need to pick an ' affordable ' franchise. That’s not as negative sounding as you think, since a large portion of your franchise cost can be financed depending on which financing option you choose. However, lets be clear, there are only two components to any business purchase, debt (what you borrow) and equity (what you put in).

A good rule of thumb these days is a 30 -40% owner equity contribution. That ratio isn’t one that is cast in stone, but is one that we see works constantly for many of our clients.

Remember also that as large as that financing challenge might be that you actually simply have to show that the funds you borrow can be repaid through your cash flow and profit projection. Actually cash flows pay back lenders, not profits. More about that shortly.

In a franchise purchase there are what we call ' soft costs ' and ‘hard costs’. The soft cost traditionally is things like the franchise fee - usually the largest soft cost on your project. Naturally it makes sense the hard costs are things like equipment, leaseholds, even perhaps real estate in some cases.

Financing soft costs is a challenge for any business in Canada. So typically the franchisee should cover them thru his portion of the equity injection. But what about those leaseholds and equipment?

Here's the great news. Financing a franchise in Canada is mostly done through a unique and specialized government loan program called the BIL / CSBF program, monitored by Industry Canada, and administered by Canadian banks under the auspices and watch of the federal program.

Is the BIL a great program? We let our clients be the ultimate judge, but in our humble opinion it provides, bar none, the best finance options for a huge amount of the Canadian franchise industry. The bottom line on the program? Simple. Great rates, terms and flexible structure, and are you ready, a limited personal guarantee. Even the big boys in business in Canada cannot often escape that one!

When clients ask us for some basic key tips and advice on dealing with a franchise lender, or even isolating who these lenders are we always revert back to BOY SCOUT MOTTO 101 - BE PREPARED! Being prepared is simple, but requires a razor sharp focus on having a crisp business plan in place, some financial projections that guess what, make sense! It should be a document that covers your experience, highlights your purchase, and most importantly, shows how you will succeed financially - i.e. pay back the lenders based on the financing options you have chosen. Simple as that.

Are the BIL finance options the only method to finance a franchise? Definitely not, there are some independent finance options out there, and in many cases we supplement the overall financing plan with equipment loans and working capital financing, which also has to be addressed early on in your planning.

If you are committed to purchasing a franchise you need clear guidance and assistance on financing a franchise successfully. You don’t get a lot of chances to do things right in the world of finance, borrowing, etc. Speak to a trusted, credible and experienced Canadian business financing advisor to ensure you maximize those finance options to your benefit.

P.S. Good luck in your new role as a Canadian entrepreneur.

Stan Prokop - founder of 7 Park Avenue Financial -


Originating business financing for Canadian companies , specializing in working capital, cash flow, asset based financing . In business 7 years - has completed in excess of 50 Million $$ of financing for Canadian corporations .Info re: Canadian business financing & contact details :