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How To Ge A t Working Capital Loan - Alternative Business Funding
Does a working capital loan requirement loom on your company's horizon? Business funding is all about timing - the right financing solutions for your business needs which change over time . That additional cash flow from the loan covers up the gap when those proverbial ' cash flow crunches' arise.
Working capital loans are typically debt financing - removing the need for business owners and entrepreneurs to have equity dilution in their ownership.
Confusion sometimes arise out of the different types of working capital loans in the current Canadian business financing environment Traditional loans of these type are typically provided by the banks, and they are longer term in nature - typically 2- 5 years . They place a very strong emphasis on historical cash flow of your firm, as well as typically a need to see some solid cash flow forecasts.
In recent times, ( hence our ' modern rules ' ) a number of very viable alternatives have arisen in the Canadian market . These alternative financing solutions are more often than not easier to obtain and provide capital to fix the shorter term challenges that business face.
Although they are no pure ' working capital loans ' per se many companies will lean towards a/r financing and short term cash advances ( typically 12 mo duration ).
The short term cash loans are typically repaid via a fixed amount on a weekly or monthly basis. Surprisingly in some cases your bank is debited daily for a fixed amount in certain situations - examples might be retailers or restaurants - The industry has termed these ' Merchant Cash Advances '. Probably the most important requirement to achieve this type of loan is simply your bank statements which show the inflows and outflows of cash . It allows for a formula to be created, determining the loan amount . Here's a secret . It's typically 10-20 per cent of your annual sales .
Receivables financing solutions pertain predominantly to firms who sell on a B2B basis . They invoice their sales , and the cash flow for the business comes down to the timing of those payments by your firms clients. No surprise that over the years the days sales outstanding has in fact increased for many firms - placing the reliance on borrowing and working capital loans .
Larger firms can also explore non bank business lines of credit - called ' asset based lines of credit ' These facilities will margin your a/r and inventory and even place a borrowing value on equipment and real estate, if in fact you own the business premises.
If you are interested in a working capital loan that provides business funding for your short or long term needs seek out and speak to a trusted, credible and experienced Canadian business financing advisor with a track record of success in alternative and traditional business finance.
7 Park Avenue Financial :
South Sheridan Executive Centre
2910 South Sheridan Way
Suite 301
Oakville, Ontario
L6J 7J8
Click Here For 7 PARK AVENUE FINANCIAL website !
7 Park Avenue Financial provides value added financing consultation for small and medium sized businesses in the area of cash flow , working capital , and debt financing .
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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