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You’re at the Crossroads for a Business Financing Decision
Information on receivable financing and business cash flow strategies in Canada - Factoring and Confidential Receivable finance solutions might be the right solution to your working capital challenges
That’s what Canadian business is looking for more than ever when it comes to the Canadian business financing marketplace for small and medium size businesses. (We suspect the big guys want the same thing!).
If your business can't obtain any (or enough) cash flow for business growth then receivable factoring just might be an option. Naturally you're the client, so we'll let you decide.
Clients always ask ' why can my firm obtain working capital financing via receivable factoring when we can via the bank. The answer is really not that mysterious - it’s a case of your new financing partner looking solely at the asset and not the big picture, which our friends at the bank tend to be focused on.
And don’t get us wrong, if you firm can obtain ' all ' the financing it needs from a Canadian chartered bank you clearly have the ultimate cash flow security in place... however the reality is that we havent really met many of those firms in the tumultuous environmENT post 2008-2009 global business financial meltdown.
So yes, the cost of factoring in general is more expensive (in some cases it actually might be cheaper!) but with receivable factoring your are operating your business in an entirely different manner.
As a Canadian business owner and financial manager you should not feel embarrassed that you haven’t heard a lot about receivable financing via a factoring working capital facility. It’s been around as a financing tool for quite some time, but it’s been a little under the radar, and oft considered an alternative tool for Canadian business financing.
Essentially it is the sale, on a one of, or ongoing basis (it’s your choice) of your receivables to a third party. You receive funds instantly, and we mean basically same day! And the total focus is very simple and straightforward - the transaction is only about the value of your receivable, its not additional debt for your balance sheet, and it monetizes your receivables to the extent that you choose.
Control is the key word here, as you control what you need to borrow, when, and what those funds will be used for. Traditionally all our clients use the funds for just one purpose - financing their business for more growth and profits.
Perception is often confused with reality, and the perception is that a receivable factoring strategy to generate cash flow for business is expensive. Yes, no... Maybe! The cost of this type of financing tends to be in the 1-3% per month range. What many of our clients miss is that putting yourself in this type of facility assures you unlimited sales and profit growth. Your investment in receivables (and inventory) has essentially been monetized on a long term basis. Also, the funds you obtain from this type of financing allow you to take supplier discounts, enhance supplier relationships, purchase smarter and in larger quantities, and increase your A/R and inventory turns, which technically play a huge role in your return on equity.
So, is receivable financing and factoring your working capital solution for business cash flow - only you can decide, but you do have choices and alternative you previously might not have been aware of. Speak to a trusted, credible, an experienced Canadian business financing advisor to ensure you choose the right method of financing when you're at the crossroads!
7 Park Avenue Financial :
South Sheridan Executive Centre
2910 South Sheridan Way
Suite 301
Oakville, Ontario
L6J 7J8
Business financing for Canadian Firms , specializing in working capital, cash flow, asset based financing , Equipment Leasing , franchise finance and Cdn. Tax Credit Finance . Founded 2004 - Completed in excess of 100 Million $ of financing for Canadian corporations .
Stan has had a successful career with some of the world’s largest and most successful corporations.
Prior to founding 7 Park Avenue Financial in 2004 his employers over the last 25 years were, ASHLAND OIL, ( 1977-1980) DIGITAL EQUIPMENT CORPORATION, ( 1980-1990) ) CABLE & WIRELESS PLC,( 1991 -1993) ) AND HEWLETT PACKARD ( 1994-2004 ) He is an expert in Canadian Business Financing.
Stan has over 40 years of business and finance executive experience. He has been recognized as a credit/financial executive for three of the largest technology companies in the world; Hewlett-Packard, Digital Equipment and Cable & Wireless. Stan has had in depth, hands on experience in assessing and evaluating thousands of companies that are seeking financing and expansion. He has been instrumental in helping many companies progress through every phase of financing, mergers & acquisitions, sales and marketing and human resources. Stan has worked with startups and public corporations and has many times established the financial wherewithal of organizations before approving millions of dollars of financing facilities and instruments on behalf of his employers.
Stan Prokop
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