How To Decide If Financing Receivables Is a Solution for Your Working Capital Funding

Ready For Some Solid R & R?

We call it the R R factor. And we are not talking about rest and recuperation!

The R R factor will give you a sense it its time to consider whether a newer, more popular method of financing receivables is your working capital funding solution.


We're going to provide you with a quick but easy and powerful tool to determine if your cash flow challenges need to be addressed in a more positive fashion. It's the receivables to revenue ratio - hence the term R R. First, take you year end balance of A/R, which is of course your uncollected sales revenue at that point in time. Then determine how many weeks of sales that represents. Calculate this ratio historically and you have a method of determining whether your cash flow and working capital requirements are changing.


So how does business address the challenge of working capital funding when it's as challenging as ever to borrow. Many companies are assessing factoring, or financing receivables. It's a simple process that is only made complex and difficult when you don't understand the pricing, how it works on a daily basis, or the important need to align yourself with a partner that offers and matches your business financing needs.


The process is actually quite simple --- On a daily, weekly, or monthly basis - it's your choice, you sell your receivables. So what happens next? Simply that the day you generate that sale you have the same day cash for those receivables. Therefore the Canadian business owner and financial manager have created a true ATM machine out of the investment the company has in accounts receivable. Readers will also begin to immediately appreciate that they have just stumbled upon the ultimate cash flow solution, because every time they sale they have instant cash. So whats the catch?


We believe there are 2 catches, and when the business owner understands and addresses them the receivable financing solution becomes much more clear and common sense.


The first ' catch ' is the cost. The typical Canadian cost of financing a receivable is 1.5- 2% / month. The firms offering the service do not call that an interest rate, they call it a discount fee. You sold something, for cash, i.e. you're receivable, and it was discounted by 1 or 2% for that privilege. Is that expensive. Absolutely... maybe! That is because most business owners don't pick up on the fact that they are in effect carrying those receivables already, which is a cost that is often not intuitively calculated by the business owner. Secondly, the term ' opportunity cost ' comes in to play, because the reality is that if your firm can generate a good return on investment you can use the cash flow from your receivable financing to generate higher profits.


So why isn't factoring or receivable financing the choice of every Canadian business for working capital funding? The reality is, and this is a surprise to many, that the largest firms in Canada utilize this financing. They simply have a stronger ability, due to their financial strength, to determine how the facility works on a daily basis, the best type of facility we recommend to customers is one in which your firm is able to bill and collect its own receivables, which is not offered by 99% of firms in the Canadian marketplace. Search out that 1% solution is what we tell our clients - at that point you will have a competitive financing vehicle for working capital and virtually unlimited cash flow growth.


Speak to a trusted and credible business financing advisor who can assist you to put together a solid working capital funding solution.

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 13 years - Completed in excess of 100 Million $$ of financing for Canadian corporations . Core competancies include receivables financing, asset based lending, working capital, equipment finance, franchise finance and tax credit financing. Info & Contact Details :


http://www.7parkavenuefinancial.com


7 Park Avenue Financial

South Sheridan Executive Centre
2910 South Sheridan Way
Suite 301
Oakville, Ontario
L6J 7J8

Direct Line = 416 319 5769

Office = 905 829 2653

Email = sprokop@7parkavenuefinancial.com

' Canadian Business Financing with the intelligent use of experience '

ABOUT THE AUTHOR
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










Article Source: http://EzineArticles.com/5263367

Financing Receivables In Canada . Get Out Of The Shallow Side Of The Pool When It Comes To Business Funding.

Is Your Firm Ready For A Better Alternative business financing solution?


OVERVIEW – Information on financing receivables in Canada for working capital and business funding and Cash flow solutions. It might be time to fully test this method of business capital





Business funding in Canada. When it comes to financing receivables clients we talk to seem somewhat hesitant sometimes to be ready to grasp all the basic aspects of this method of financing cash flow needs. And that goes from CFO's of mid market type firms all the way down to early stage companies that are just starting to generate profits. Let's dig in.

Why then is the business owner/financial manager reluctant to get out of the shallow side of the pool

and step into the deep waters of factor funding in Canada? At the end of the day is just one additional way to generate instant cash flow when your company is selling its products and services. It’s, quite simply a way to beat your clients at the waiting game when it comes to collecting your accounts.

Did you know there are two basic kinds of receivable finance in Canada? One is what we can call ' traditional/old school ' whereby your A/R is co managed by the finance partner. The other is a Confidential A/R financing solution which allows you to bill and collect your own accounts, while all the while achieving all the benefits of this finance method.

While each has its own advantages and issues we certain prefer Confidential A/R financing because it's more business as usual. At the end of the day each of the two methods are simply ways in which your finance partner assesses risk and manages their business.

99% of the confusion (in our humble opinion) around business funding for A/R in Canada revolves around some of the semantics. Essentially we're talking about the difference between how a bank finances your A/R versus alternative A/R finance - aka ' factoring’. The bank simply creates a legal document around their ability to hold the collateral of your receivables as an ongoing borrowing. So from an accounting perspective its business as usual since your AR stays on your balance sheet and you simply utilize a line of credit to borrow against 75% of your receivable base.

75% is the standard borrowing base you get when financing your sales via a Canadian chartered bank facility. ( By the way factor funding allows you to borrow against 90% of you’re a/r base, so you’ve got instant 15% additional borrowing power!

On the other hand is the traditional or confidential method of financing the same asset. In this case the paperwork/legal docs of your finance partner show that you've in effect ' sold ' your A/R and are receiving immediate cash draw on that borrowing base.

We see little difference in the paperwork; however we see a lot of difference, as we have said in how the facility operates on a daily basis. That's where the confusion lies with clients. That's when, as Ricky Ricardo said, we’ve got a ' lot of splaining ' to do!!

If you're looking for the straight goods on business funding in Canada take some time to understand just a handful of basics. Step out of the shallow side of the pool and wade in! Seek out and speak to a trusted, credible and experienced Canadian business financing advisor who can assist you with your financing needs.




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 10 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.
Info re: Canadian business financing & contact details :



7 Park Avenue Financial = Canadian Receivables Funding Expertise





CONTACT:
7 Park Avenue Financial
South Sheridan Executive Centre
2910 South Sheridan Way
Suite 301
Oakville, Ontario
L6J 7J8
Phone = 905 829 2653
Fax = 905 829 2653
Email = sprokop@7parkavenuefinancial.com

Stan Prokop

Financing Receivables Works Whether You’re A Start Up Or One Of Canada’s Largest Corporate Borrowers

Technically Speaking Let’s Take The Mystery Out Of A/R Financing In Canadian Business

OVERVIEW – Information on financing receivables in Canada . What are the key technical aspects and benefits of factoring / selling receivables for companies of all size in Canada



Financing Receivables in Canada . A large majority of business owners, financial managers, CFO's, Controllers, etc have heard of this stand alone (it doesnt have to be the case) method of Canadian business financing. But do they understand it? Let's dig in.

We maintain, when talking to our clients, that you simply need to know a few key basics to effectively master this finance solution. And by the way, you don't have to be a rocket scientist to master those. We suppose it's our version of ' Technically Speaking '!

however if you don't we can clearly say you' re under advantaged when it comes to understanding benefits and risks re: who you're dealing with and how you're dealing with them . Bottom line, we're talking about what can go write and what can go wrong.


At the end of the day, financing receivables is simply one method to generate cash out of your sales and receivables. All you are doing is shortening what is known as the operating cycle - you’re no longer in the ' waiting room ' when it comes to waiting for customers to pay.

In Canada you have two methods of addressing factoring. You can let a third party take over the whole process, or alternatively you can become the manager of the whole process yourself. We call that second method Confidential A/R Financing. We'll call the other method ' Traditional Factoring ‘, and it’s been used for hundreds of years by thousands of companies all over the world. This ain't new!

If you go the traditional route your billing and collecting process is somewhat taken over - in effect your credit and collection process is outsourced and managed. Under a confidential scenario you maintain total control over all your billing and collections, with both methods essentially costing the same. They should cost the same - if they don't you’re not dealing with the right party.

The basic finance charge around this whole process is what is known as the discount rate. That discount rate, which many people understandably, but mistakenly call an ' interest rate ‘is a key element in the overall pricing of this finance solution.

A lot of clients we speak to seem to wrestle with the issue of understanding how this method of growth financing differs from bank finance. It really comes down to how the bank, vs. the receivable finance firm ‘papers ' your transaction. That technical aspect involves two key terms, 'Assigning' your A/R to the bank, or ' Selling ' your A/R to your A/R Finance firm. So that's just the paperwork on the deal, and it's not as complicated as you think.

What You Need To Know: Financing receivables is a method of financing trade commercial receivables. Benefits are fast access to business cash and easier qualification. Who you deal with and how you manage this method of growth/sales financing becomes the risk.

Seek out and speak to a trusted, credible and experienced Canadian business advisor with a track record in financing companies for growth and success.



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 10 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.
Info re: Canadian business financing & contact details :


7 Park Avenue Financial = Financing Receivables Experts





CONTACT:
7 Park Avenue Financial
South Sheridan Executive Centre
2910 South Sheridan Way
Suite 301
Oakville, Ontario
L6J 7J8
Phone = 905 829 2653
Fax = 905 829 2653
Email = sprokop@7parkavenuefinancial.com





















Stan Prokop

Financing Receivables. Here’s What You Didn’t Know About An Accounts Receivable Financing Company!

This Just In! A/R Finance just might work!



Information on financing receivables in Canada. What does the Canadian business owner and manager need to know when dealing with an accounts receivable financing and factoring company.




When Canadian business owners and managers utilize an accounts receivable financing company the focus is all on the dollar value and quality of your A/R. That's what is going to generate cash flow under this process - which simply is a transaction in which you immediately monetize your sales for cash, at a discount... the obvious benefit being the ability to generate cash flow and working capital for your company.

We will add a small technical point here, in that when we typically describe the process we always advise clients that invoice discounting monetizes your revenues as you generate them. That infers that you have to finance those sales all the time and immediately, and actually that’s not 100% correct. The reason? Simply that if you are working with the right firm you certainly can finance any amount of sales you need - it doesnt have to be all or nothing.

And about that ' timing ' issue. The reality is that you can finance those sales ' ANYTIME' after you make them. Quick example: You generate a 100k sale to one of your clients, and the client typically pays you in 60 days. (Notwithstanding your terms are 30 days!) . If you don’t need the cash right away but need it, for example around day 45 in this process, you can finance the invoice then. The benefit - Again its immediate cash when you need it and you are only paying for 15 days of financing! Talk about a win / win!

Invoice discounting, A/R Financing, Factoring, etc are all synonymous terms for the process we are describing today. Pricing always causes mass confusion

with clients. Can this confusion be avoided? We thing it can when you simply focus on and understand the three elements of A/R finance pricing - they are:

The advance rate/ hold back

The discount rate

Time to collect your accounts

When you have a solid grasp on those you've become somewhat of an immediate Receivables Financing expert.

Let's use a quick example, and let us use a 100k invoice as an example. There is no real dollar limit on these facilities, and for that matter invoice size, whether large or small, is not a concern either.

Anyway, you have just invoiced your sale and have 100k outstanding on an invoice. The Accounts receivable financing company will typically advance, at your request 90% of this amount. The 10% is a reserve or hold back that allows for anything going wrong, primarily uncollectibility. If your customer pays you in 60 days, as they typically did in our example you receive the 10% hold back, less financing costs which are typically 1.5-2% for a 30 day period.

If you are using traditional A/R financing companies the finance firm you are dealing with handles collections. That's not our recommended solution - as we prefer the confidential invoice financing strategy, allowing you to bill and collect your own accounts, with no notice to any client, supplier, other lender, etc. We do of course point out that when financing receivables your accounts receivable financing company partner must in fact have clear collateral of your receivables. Many clients we talk to think they can have a bank line and finance receivables via a commercial finance firm. They are wrong! It's one or the other.

Seek out and speak to a trusted, credible and experienced Canadian business financing advisor who can assist you in setting up the facility that works for your business when it comes to monetizing your sales revenues and cash flowing that balance sheet!

7 PARK AVENUE FINANCIAL
CANADIAN RECEIVABLES FINANCING EXPERTISE


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 10 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.
Info re: Canadian business financing & contact details :

http://www.7parkavenuefinancial.com/financing-receivables-accounts-receivable-company.html



7 Park Avenue Financial
South Sheridan Executive Centre
2910 South Sheridan Way
Suite 301
Oakville, Ontario
L6J 7J8
Phone = 905 829 2653
Fax = 905 829 2653

Email = sprokop@7parkavenuefinancial.com
























Stan Prokop

Can Financing Receivables Ignite Your Business Funding . Cost and Benefits Of Factoring Funding In Canada

Know How To Fire Up Business Cash Flow?



OVERVIEW – Information on financing receivables in Canada. Assessing invoice finance as a finance option , and understanding the cost of factoring a/r in the Canadian business financing marketplace.



We'd all agree there’s a major difference in igniting, and on the other hand, freezing your business credit. We maintain to clients that financing receivables is a key ' igniter '

of cash flow funding in Canada when the Canadian business owner and financial manager is experiencing the business credit freeze !

Trends now show that thousands of businesses in Canada find themselves unable to get the financing they need. Whether they are ' cut off ' or simply ' restricted' in getting capital into their firm the repercussions can be anywhere from being mild to severe, severe of course meaning closing your business.

So why is receivable finance funding different, and how does the business owner/manager asses the cost of factoring A/R into a sensible arrangement?

The essence of invoice discounting, aka ' factoring, aka ' invoice discounting ' is simply the ability to monetize sales directly into cash as you generate revenue. That in itself is a powerful statement. Where things go wrong is when your business locks itself into a facility that either costs too much, is unwieldy to operate, and simply doesnt mesh with your day to day operations. By the way, that absolutely doesnt have to be the case!

So if banks also margin receivables for cash flow for your business wouldn't Canada's chartered banks be the optimal solutions for cash flow finance. Well they would be that perfect solution if your business qualifies, and if you do qualify do you in fact have access to all the credit you need to grow the business when it comes to seasonality, large orders, cash flow bulges, slow paying clients, etc. The answer is that while our banks in Canada provide the best and most ' low cost ' solution the reality is that not everyone qualifies.

The short answer to bank versus non bank funding in Canada, when it comes to A/R finance is that the bank bases its decision on your sales, profits, and balance sheet; Factoring on the other hand bases its finance formula only on your sales and the invoices generated from that revenue. Oh and by the way, funding is in fact ' same day '. And it's only as complex as you want it to be , and the industry itself , unfortunately does not always do a good job of explaining facilities ; sometimes employing smoke and mirrors

to hide costs and day to day facilitation of the financing . That's when you need clarity!

The key to a successful A/R finance program in Canada is your management of the program. The type of facility you enter into, as well as your ability to control what you finance and when is critical. And , as a kicker, our recommendation to clients are ' confidential ' facilities that allow you to bill and collect your own receivables in a manner that allows the competition to do only one thing - figure out where you are getting all that cash .

Whether you're a start up, medium sized firm, or a large corporation, financing receivables can be a huge part of your business success. Seek out and speak to a trusted, credible and experienced Canadian business financing advisor today who can assist you with the facility that makes the most sense for your unique needs.

7 PARK AVENUE FINANCIAL
CANADIAN RECEIVABLE FINANCE EXPERTISE



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.
Info re: Canadian business financing & contact details :



http://www.7parkavenuefinancial.com/financing_receivables_cost_of_factoring_funding.html

Surgically Removing The ‘ Ouch ‘ Out Of AR Factoring in Canada . Financing Receivables Via A Factor Company Is Not Necessarily What You Think !

Should Your Firm Consider .. Or Avoid Factoring ?


OVERVIEW – Information on factoring in Canada . Financing AR Receivables via the ‘ right ‘ factor company is not what you think !





Our goal... simple... a surgical removal

of the word ' ouch ' from factoring receivables in Canada. Is such a delicate operation even possible? Is there a ( business ) doctor in the house …We think so... let's ' scrub down ' and get started!

There's a real inequality issue among many businesses in Canada... some of them have cash on hand, cash flow, and working capital, and some don't.

If your firm, large or small is in the latter category financing receivables in Canada is one of the most solid and effective solutions to your problem. But how does a factor company work, and where do you find one, and oh yes, what does it cost? That cost, quite frankly, is usually the 2nd or sometimes first reason that the ' ouch ' exists in the mind of the Canadian business owner and financial manager.

The actual tool itself is fundamentally easy to understand. Unlike borrowing against your receivables, which you do via a Canadian chartered bank or business credit union factoring works in the manner of having documentation in place with the factor company that specifies your ongoing actual sales of the receivables .

So the A/R isn’t collateral per se, the cash you receive for them is the proceeds of the sale. That’s the simple basic explanation most clients need to know when we point out the differences between a bank facility and a factor company that’s usually in the sole business of financing receivables.

We do add however that a number of other financing mechanisms can be ' bolted on ' to your factoring facility - typically they include inventory financing, PO finance, or allowing you to borrow against owned equipment. But that whole comprehensive solution we have just described is a conversation for another day - our focus here is just factoring AR.

So how much can a client finance their firm given they have opted to consider an A/R finance strategy. The answer is as much as you want, as long as you have the receivables to back up the solution.

The ultimate size and type of facility you enter into is driven by your firm’s general financial condition, the size of your annual sales revenue, and the quality of your customer base. We explain to clients that in general all your North American receivables can be financed, simply meaning that you can cover U.S. clients also under your factor facility . Foreign, non North American clients might require some sort of credit insurance - but you probably want that anyway.

The actual mechanism of the financing is worthwhile exploring for a moment. Your invoices are sold, via your original documentation agreement with the factor company at a discount of approximately 2% if you are selling on 30 day terms. That 2% reduction in the value of your sale is the factor company’s profit.

The absolute method in which we can assure clients that they can remove the ' OUCH ' factor in financing A/R in Canada revolves around a few basic issues:

Clear understanding of how pricing works

Getting a competitive rate

Dealing with the right firm - Hint - VERY IMPORTANT!

Ensuring you can get a confidential facility in place, allowing you to bill and collect your own receivables. (99% of the firms you might choose to deal with cannot do this for you)

So, operation successful? We hope so. Utilize the services of a trusted credible and experienced Canadian business financing advisor who can assist you with your factoring needs.

7 PARK AVENUE FINANCIAL
CANADIAN A/R FACTORING EXPERTISE

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.
Info re: Canadian business financing & contact details :


http://www.7parkavenuefinancial.com/factoring_ar_financing_receivables_factor_company.html

Turn $500,000.00 Of Promises Into Cash In 4 Hours . Financing Receivables Via Invoice Discounting And Receivable Lending In Canada

Canada’s Newest Cash Flow Financing Tool


Information on financing receivables in Canada . How invoice discounting via receivable lending turbo charges cash flow and working capital .




Financing receivables in Canada. Trust us, it's not magic . The concept of invoice discounting and receivables lending practices in Canada allows Canadian business owners and financial managers to turn sales into cash ,, pretty well in 4 hrs .. ! In case you haven't thought about that a lot, 4 hrs is better than waiting 1, 2, and yes sometimes almost 3 months for your sales to turn into customer receipts of payment . Talk about bridging the gap!

Surely business owners can't be surprised when they hear that the majority of firms tend to drag their feet when it comes to paying their bills . In the world of corporate financing slowing down payables is actually part of the formula for cash flow calculations ! And be honest, you cant be surprised about that one since the your firm is probably itself in that same majority of firms who in a calculated manner only pay suppliers at the last minute .

At the root of the matter though is the fact that the slow down in receipts from your clients creates a problem for your firm . Can it be fixed ? Absolutely .

We'll quickly add that your own firm can do a lot internally to accelerate cash - that can be done by stressing payment terms with clients and maintaining a focused ( but professional ) approach to collecting your accounts . That type of policy also prevents you from hearing about invoice or product or service problems much too late in the business cash flow cycle .

While many firms want a positive business relationship rather than have their valued customers on ' credit hold ' its safe to say this is a tough balancing act to manage . One U.S. survey, and we're pretty sure it is the same in Canada had 1000 of the largest corporations in America acknowledging they were paying suppliers more slowly . We already told you the reason why of course . Another survey indicated by the way that 50% of all ' small guys ' were experiencing cash flow ' concerns'! No surprise, right .

Naturally the concern of the SME business owner and manager revolves around ' will I lose a client if we have a strict credit policy '. We don't think so , but at the same time that is yours to decide . We would add by the way that profits of lack thereof rarely takes down a company, but running out of cash ... does .

So, our ' magic solution ' on turning , in our example 500k of promises into cash . Its invoice discounting. It's basically getting cash before your client pays you, and it’s done via legitimate receivable lending firms, typically non bank in nature in Canada.

Your receivable or receivables are purchased when you issue the invoice, and typically, 4 hrs or so later you have cash in the bank. In Canada a typical advance rate is 90%, so if you have 550,000.00$ in sales you would receive approx 500,000.00$ in cash. Oh and by the way, that remaining 10% is yours when your client pays, less the financing cost.

Accounting for all this is quite simple , using one invoice as an example you would CR a/r and DEBIT cash and invoice financing expense . Mission accomplished!

The largest corporations in North America use a more formal program that typically is called ' securitization ' whereby they move their a/r off the balance sheet to a third party in exchange for immediate cash . Boy does that balance sheet look good. No A/R and plenty of cash.

The benefits of financing receivables should by now be pretty obvious - it comes down to customer retention, not running out of cash, better supplier relations , and the ability to feel you have a sense on future sales and growth financing .


Speak to a trusted, credible and experience Canadian business financing advisor on how your firm can benefit from invoice discounting. It's not magic, just experience and knowledge!

7 PARK AVENUE FINANCIAL
CANADIAN INVOICE FINANCING EXPERTISE


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.
Info re: Canadian business financing & contact details :

http://www.7parkavenuefinancial.com/financing_receivables_invoice_discounting_lending.html

Let Financing Receivables Stop That Feeling Of Borrowed Time . “ Lien “ on Canadian Invoice Finance And Factoring For The Solution.

A Canadian Financing Strategy .. that works!


Information on financing receivables in Canada . How the invoice finance and factoring solution helps Canadian business stay cash flow positive!





Financing receivables in Canada. It's no secret that invoice finance, aka ' factoring ' is part of the ' new normal ' when it comes to Canadian business financing.

There are probably thousands of Canadian businesses who constantly feel they are living on borrowed time. That is why invoice financing, collateralized by a ' lien ' on your receivables has become a solution of either choice or necessity for the business owner or financial manager.

Oh and by the way some of the biggest corporations in the world also utilize this method of financing their growth and largest asset, the A/R.

A lot of the activity around financing receivables is, unfortunately, being driven by... yes; you guessed it, your clients. Why is that? Simply because they either by policy, or practice, have chosen to slow down their payments to yourself. We're aware of one case wherein one of the largest companies in the world advised their printers they would pay all invoices on 120 day terms. Talk about a painful hit to cash flow!

While we certainly realize that the typical payments from your clients are probably closer to 60 days these days, (that kind of seems to be the new norm) it allows a financing receivables strategy to ensure you take much less of a hit on your cash flow and working capital.


The triple whammy. That's our own term for what else is happening out there in the Canadian business financing marketplace. Your suppliers slow down, bank financing becomes harder to achieve, and you still want and have the ability to grow your company. Talk about a perfect storm that comes together to challenge your firm in every manner!

One of the reasons that invoice finance is so popular these days is simple that is a ' stable ' source of funding for your firm. What business owner or manager doesnt want a reliable source of funding and working capital .in the current economic environment? That is a basic premise of invoice financing or factoring - the fact that your facility can be reviewed anytime, within pretty well a days time, to be increased based on your needs.

Cost is often a factor that turns off many clients who look at financing receivables. While the cost is higher than traditional bank finance that has to be balance off against access to capital. In trying to present a balanced outlook on invoice finance we also note that you typically have to report more regularly on your business progress - that typically includes monthly reporting on aged receivables, payables, and a balance sheet and income statement snapshot. We don’t think that necessarily is a bad thing though, as many clients tell us that process allows them to understand and run their companies better.

So, if you want to stop that feeling of ' borrowed time ' let a invoice finance firm ' lien ' on your receivables . That immediate uptick in cash flow and working capital should allow for better business performance... with less stress! Speak to a trusted, credible and experienced Canadian business financing advisor today on how invoice finance works, for you.

7 PARK AVENUE FINANCIAL

CANADIAN RECEIVABLES FINANCING EXPERTISE





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.
Info re: Canadian business financing & contact details :

http://www.7parkavenuefinancial.com/financing_receivables_invoice_finance_factoring.html

Want Some Business Financing Privacy ? Canadian Confidential Receivables Financing Is An Alternative To Commercial Finance Factoring Funding

Grow Your Business and Cash Flow With This Unique Innovative cash flow solution !


Information on a Canadian business financing strategy known as confidential receivables financing and why this alternative to commercial finance factoring is a welcome surprise to businesses seeking growth funding.




We hear a lot these days about ' privacy’ and confidentiality in business these days. Well, here's a twist on that.

How would you like to be the firm that has a confidential receivables financing facility in place when all your competitors and other firms are using traditional commercial finance factoring funding for their cash flow/working capital? Sounds interesting, right?

The hard reality these days it that financing receivables has emerged as an ' in fashion' alternative to traditional financing that is often unavailable to thousands of medium and smaller businesses in Canada . (Oh and by the way, larger corporations use a subset of this financing also!)

We're often amazed at how long some firms continue to use commercial finance factoring. There are all sorts of reasons why. One not so obvious one is that Canadian banks will often calculate interest on your firm’s entire line of approved credit, even if you are only using part of it. Seem a bit unfair don’t you think? Receivables financing strategy is the ultimate in ' paying for what you only use '.

We admit that’s one smaller point in why factoring agreements are in place by thousands of firms in Canada. The reality is that the total flexibility of this business financing solution is in fact what most businesses are interested in .If we had to be pinned down and identify one main reason why firms factor receivables it might just well be that you credit facility grows as you sales grow . So, bottom line, no more annual reviews or bulge crises when things don’t work out on a temporary basis. It’s the end of ' fighting fires' in cash flow and working capital.

Financing receivables is a subset of asset based lending in Canada. Your firm sells its A/R either on a one time or ongoing basis. A hefty advance, usually 90% range, is made against that most valuable of current assets, your customer accounts. You have just generated instant cash flow. Once your client pays that ' holdback' of 10% or so is refunded, less financing costs, to you, the client.

Those financing costs in Canada average anywhere from 1-3% a month, and quite frankly that middle range, i.e. 2% is a typical fee for each invoice based on a standard industry credit term of 30 days. Factors that affect your rate are size of your portfolio, your general overall financial condition, and the quality and size of your A/R and client base.

So, that privacy issue. What's that all about ask clients. Well, our preference is for you to consider a confidential receivables financing alternative. Under this type of facility you bill and collect your own receivables, the bottom line your financing arrangements are known only to you and your receivable finance partner.

What an advantage! Simply because thousands of other firms, including your competitors who utilize commercial finance factoring have to go through a somewhat intrusive process of have traditional factor firms notify clients and are involved in collecting your accounts.

So, bottom line? If you don’t mind the whole world knowing about how you finance your firms business then consider a traditional commercial finance factoring strategy.

If on the alternative you want all the benefits, the same cost by the way, and want to run your own business from a cash flow and working capital standpoint... well, you know what to do! Speak to a trusted credible and experienced Canadian business financing advisor on how confidential financing of receivables can work for you!




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 .Info re: Canadian business financing & contact details :



http://www.7parkavenuefinancial.com/financing_receivables_commercial_finance_factoring.html

Can A Financing Receivables Strategy Save Your Company ! A Perfect Solution Via Business Finance Companies ?

Why Confidential Invoice Discounting Works Best


Information on financing receivables in Canada via business finance companies . Let a Confidential factoring solution save and grow your business!




Survival. Growth. Are they different concepts? Business financing in Canada addresses of course both those basics. And one type of financing, the financing receivables offered by business finance companies seems to address both those issues very well thank you, in the SME sector. Let's examine how that works, what are some of the key benefits, and if in fact one optimal solution exists with this type of financing.

Clients we talk to are often frustrated in their attempts to achieve cash flow and working capital financing in an efficient, simple matter. They are looking for both flexibility, and speed in closing a solution - unfortunately they don’t always find it.

Receivables financing fits somewhat perfectly into solving the desires of Canadian business owners and financial managers. However the array of types of business finance companies that offer that solution, and how that solution is delivered can sometimes be confusing to clients.

So, the basics... a receivable finance (aka invoice discounting/factoring) facility is the sale, on a one of, or ongoing basis of your billed receivables. That sale allows you to receive cash, in advance of course, of the collection of that receivable. We've been watching the age of Canadian business receivables get older and older of the years and while the norm ' in the old days' used to be 30 the new norm is of 60-90 days... unfortuantely!

Clients are always asking when the correct time to consider such a facility is. Some key factors that will help them achieve both survival and growth are as follows - double digit growth in sales, requests from customers for extended terms, pressure from suppliers for accelerated payments from your firm, etc. Any or all of those points can come together in a final decision to include a receivables financing strategy into your survival equation.

So if in fact you made that decision can you expect to receive benefits that are tangible and offset the cost of this financing, which is very typically higher than bank finance rates? The answer is ' yes '!

Key benefits include the ability to achieve higher revenues due to the working capital infusion you have just arranged. Your cash flow now becomes very predictable given that you receive funds as you generate sales - a lot of the seasonality and bulges around your business ups and downs disappears. And, contrary to what some clients believe, you're not borrowing funds and incurring debt, you are simply monetizing the left side of your balance sheet. Your A/R account simple reads ' cash on hand'! and that’s a good thing.

So what about the cost of this financing? In Canada it’s typically between 2-3% per month. That cost can be offset in a number of manners. The challenge we see clients face is in the way in which financing receivables in Canada is in fact presented by business finance companies. Rarely is the fee represented in a one time clear explanation - its masked with various miscellaneous issues.

Is there one type of facility that we recommend as optimal to clients? There is. It’s a confidential working capital/factoring financing that allows you to bill and collect your own receivables. You maintain the benefits of this type of financing, while being in control of your own destiny, and that growth and survival we spoke of!

Speak to a trusted, credible and experienced Canadian business financing advisor who can help you steer your way through the myriad of offerings in the Canadian business space.





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 .Info re: Canadian business financing & contact details :


http://www.7parkavenuefinancial.com/financing_receivables_business_finance_companies.html

Study : Can Financing Receivables Via A Confidential Receivable Factoring & Funding Solution Save Your Company?

Do The Benefits of A/R Finance Solve Your Working Capital Challenges ?


Information on financing receivables in Canada . What is a receivable factoring solution and how does funding a/r solve the gap in your firms cash flow and working capital needs.




We're pretty sure, based on talking to clients, that thousands of Canadian business owners and financials managers start every Monday worrying about business financing and cash flow. A lot is being said these days about financing receivables as a subset of asset based lending in Canada.

But can a receivable factoring and funding strategy really save your company? And another thing, what's a confidential invoice funding strategy and how does it work. A lot of questions! Let’s get some answers.

It is somewhat ironic that the growth your firm faces, which is clearly a good thing is offset by the need for more and more cash flow and working capital as you build receivables, and yes, inventories also. It's a very simple gap - simply the time between being paid for your customers and the need to pay suppliers and your operating costs. In a perfect world (it’s not apparently) your suppliers would be willing to wait an unlimited amount of time. They don't.

Therefore financing your receivables as you generate them provides you with cash flow needed - you are simply closing the proverbial gap in waiting for your clients funds.

In Canada you should expect, via a receivable finance strategy to receive in the area of 90% for your receivable funding as you submit invoices. What about that other 10%? It’s simply held back as a holdback or reserve to leave a buffer for financing costs and any short payments for your clients.

Financing costs. That’s the real discussion point these days on receivable factoring in Canada. Those costs range from 1- 5%. That’s a big range, so what defines that range. Typically the 4-5% range is defined by firms having very small receivable balances and who themselves are relatively small firms. A more typical range in Canada is 2%. While many clients view that as and interest rate on a 30 day basis it’s actually the discount your finance partner bases the purchase of your receivables on. So, utilizing a $100,000 dollar invoice as an example you should be expected to ultimately receive $ 98,000 for the invoice. That’s at settlement time when your client pays and you also receive the rest of the holdback we referred to.

So is that financing fee too much for your firm ?History tells us its not, in that your ability to generate more sales with the cash flow you receive daily usually significantly outweighs lost sales revenue , or , even worse, your ability not to meet your obligations to supplies or other creditors . The majority of clients we speak to are looking to grow their business and use a receivable factoring strategy as a tool to do that.

If you are looking at the traditional type of receivable finance facility in Canada that is offered there is one aspect that doesn’t appeal to many business owners, in that 99% of the firms in Canada who offer A/R finance require a notice to your client around this financing. That’s where a confidential invoice funding strategy works best, you bill and collect your own receivables, and your method of financing your firm is just that, yours, and no one else’s business.

So, can financing receivables save your company? We thing if it isn’t a matter of saving it’s a least a mechanism for growing, and that’s not a bad thing. To be honest though many firms that face financial challenges are often saved by an interim funding strategy such as ours when they cant obtain traditional bank type finance .

More info? Questions ? Speak to a trusted, credible and experienced Canadian business financing advisor on the benefits of a confidential invoice finance strategy.




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 .Info re: Canadian business financing & contact details :


http://www.7parkavenuefinancial.com/financing_receivables_receivable_factoring_funding.html

How To Decide if Financing Receivables Is a Solution for Your Working Capital Funding

We call it the R R factor. And we are not talking about rest and recuperation! The R R factor will give you a sense it its time to consider whether a newer, more popular method of financing receivables is your working capital funding solution .

We're going to provide you with a quick but easy and powerful tool to determine if your cash flow challenges need to be addressed in a more positive fashion. It's the receivables to revenue ration - hence the term R R . First, take you year end balance of A/R, which is of course your uncollected sales revenue at that point in time. Then determine how many weeks of sales that represents. Calculate this ratio historically and you have a method of determining whether your cash flow and working capital requirements are changing.

So how does business address the challenge of working capital funding when it’s as challenging as ever to borrow. Many companies are assessing factoring, or financing receivables. It’s a simple process that is only made complex and difficult when you don’t understand the pricing, how it works on a daily basis, or the important need to align yourself with a partner that offers and matches your business financing needs.

The process is actually quite simple --- On a daily, weekly, or monthly basis - it’s your choice, you sell your receivables. So what happens next? Simply that the day you generate that sale you have the same day cash for those receivables. Therefore the Canadian business owner and financial manager have created a true ATM machine out of the investment the company has in accounts receivable. Readers will also begin to immediately appreciate that they have just stumbled upon the ultimate cash flow solution, because every time they sale they have instant cash. So whats the catch?

We believe there are 2 catches, and when the business owner understands and addresses them the receivable financing solution becomes much more clear and common sense.

The first ' catch ' is the cost. The typical Canadian cost of financing a receivable is 1.5- 2% / month. The firms offering the service do not call that an interest rate, they call it a discount fee. You sold something, for cash, i.e. you’re receivable, and it was discounted by 1 or 2% for that privilege. Is that expensive. Absolutely ... maybe! That is because most business owners don’t pick up on the fact that they are in effect carrying those receivables already, which is a cost that is often not intuitively calculated by the business owner. Secondly, the term ' opportunity cost ' comes in to play, because the reality is that if your firm can generate a good return on investment you can use the cash flow from your receivable financing to generate higher profits .

So why isn’t factoring or receivable financing the choice of every Canadian business for working capital funding? The reality is, and this is a surprise to many, that the largest firms in Canada utilize this financing. They simply have a stronger ability, due to their financial strength, to determine how the facility works on a daily basis, the best type of facility we recommend to customers is one in which your firm is able to bill and collect its own receivables, which is not offered by 99% of firms in the Canadian marketplace. Search out that 1% solution is what we tell our clients - at that point you will have a competitive financing vehicle for working capital and virtually unlimited cash flow growth.

Speak to a trusted and credible business financing advisor who can assist you to put together a solid working capital funding solution.