Cash Flow Problems Hampering Growth? Survival? Canadian Business Working Capital Solutions. Right Here Right Now!

Solutions To Your Biggest Financial Dilemmas


Information on business working capital solutions for Canadian firms who face cash flow problems arising from growth . Measuring the problem and addressing the solution !






When Canadian business owners and financial managers encounter cash flow problems several business working capital solutions are available.

One of them is very ' not ' obvious which is to stop growing. That's a tough one for the entrepreneur to swallow of course. but it's true. Stopping growth means that additional funds are not needed to maintain higher level of inventories, receivables, or the need to invest in new equipment.

When you are in a turnaround or crisis type situation is when it's of course the most difficult time to grow and expand your business. That's simply because pressure from secured lenders and unsecured trade creditors is at its height. And that's never comfortable.

Today it might seem like we are talking about the not so obvious, so another key point that we will offer up is simply the fact that when you're focused on only growth there is a lot of room sometimes to hide cost or other issues that might be being mismanaged in your company.

Again, tough to swallow, but when you increase sales, as we said, you increase the need for working capital. If you stopped growing and simply ran your business efficiently you will probably find you can free up cash flow and cease the pressures with your lenders and suppliers.

That's also the best time, again as difficult as it may seem, to focus on profitable business as opposed to ' volume ' type business. We can't help but be reminded about the old saying ' we'll make it up on the volume '. Our point, you never do!

So instead of sometimes only trying to focus on growth and revenue Canadian business might well do better to address raising prices, and, heaven forbid, reducing sales! This frees up your current assets, which is at the core of your cash flow problems, as they represent your business working capital.

When you think of it, we're actually saying you should be setting up a comparison model between your cash flow and your sales growth.

Many businesses in Canada, (perhaps not tech type business) would be very happy with a ten percent year over year sales growth. Let's say you were focused on growing at 25% this year, a huge increase by any measure. However, profits and cash flow and working capital don't move lock step with those sales.

While profits on paper might show up nicely it’s the changes in your current assets you should be focusing on. Here is where you want to ensure that A/R is also rising at the same rate. This is not the time to be offering extended trade credit to your clients.

So, what have we focused on ?Just the basics, which are that in today’s case management and controlling growth have a huge effect on business working capital .

A perfect world just may exist when you're growing sales and addressing profit and cash flow issues at the same time.

Solutions for cash flow problems in Canada include asset based lending, receivable financing, mezzanine debt, purchase order/contract financing, and even monetization of your tax credits.

Speak to a trusted, credible and experienced Canadian business financing advisor who can assist you in the need for proper business working capital.





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 . Core competancies include receivables financing, asset based lending, working capital, equipment finance, franchise finance and tax credit financing.