WELCOME !

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.



Showing posts with label account receivable. Show all posts
Showing posts with label account receivable. Show all posts

Monday, January 6, 2014

AR Financing Just Got Seriously Better : Account Receivable Factoring Definition Redefined













Your Company Signed Up For A/R Financing & Didn’t Get What You Thought?


OVERVIEW – Information on AR Financing in Canada . When It comes to account receivable factoring are you aware of the best solution?






AR (account receivable) financing is a critical aspect of any, large or small, commercial business that sells on credit. That time gap from when you are finally able to issue an invoice, to when you get paid is one of the most critical time periods in any business. More often than not that time gap needs to be financed - in the right manner. Let's dig in.

Many clients we speak to have in fact already ' signed up' for some form of receivables finance - in certain cases they are ' factoring' their A/R. The challenge then? It's just a case of what they got isn’t necessarily what they signed up for. And a small handful of key tips can help you avoid any mistakes in this area.

Why do firms finance A/R? As we have hinted it’s simply that in corporate finance the ' working capital cycle' needs to be addressed. And typically the way to ' shorten ' than waiting to get paid scenario is addressing the financing of your firm’s receivables.

When firms use a third party finance company , as opposed to bank financing , to finance working capital its really the type of facility and terms that ' make or break' a good deal in this area . It is probably apparent to all, but we will say it never the less, that Canadian chartered bank financing is simply not available to all commercial borrowers in Canada. And sometimes, even when it is, it's not enough.

One of the true ironies of Canadian business financing is that our banks, in general, are not generally in favor of meteoric sales growth - the type that requires huge bulges in financing needs. As someone once put it, the challenge is to keep your company both ' going' and ' growing'!

So why do firms turn to a commercial finance company for factoring of their receivables? It's really the reasons, and how the financing addresses those reasons properly that’s at the crux of our discussion today.

And those reasons? They more often than not are as follows:

Inability to secure bank financing (company too new or no established track record

A/R Exposure to government receivables or out of country sales


Financing required is often greater than available through a bank even if the company were approved by its bank

Fast timing is required to address large orders/contracts

The need to address a slow down in payments from key clients

So is there a ' perfect’ factoring facility that addresses and cures all of the above issues. One that we feel does that is Confidential A/R Financing. It allows you to bill and collect your own receivables, is competitive in price, requires no notices to your clients, and allows you to margin up to 90% of your AR on an ongoing basis as your firm ' goes; and ' grows'!

Where do things go wrong then? It's simply when the business owner or financial manager doesn't understand the paperwork, pricing, and ongoing management of this type of facility. One way to correct that? Seek out and speak to a trusted, credible and experienced Canadian business Financing Advisor with a track record of success who can assist you in your account receivable factoring needs.




Stan Prokop - 7 Park Avenue Financial :

http://www.7parkavenuefinancial.com

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 90 Million $ of financing for Canadian corporations . Info & Contact details :

7 Park Avenue Financial = Canadian A/R Financing Expertise





Have A Question /Comment On Our Blog Or Canadian Business Financing Alternatives ?

CONTACT:

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


























Sunday, November 3, 2013

Rethinking Account Receivable Financing Via A Business Factor In Canada : Here’s Why.. And How




Reducing The Cost Of Receivable Finance In Canada











OVERVIEW – Information on account receivable financing in Canada. How the business owner/financial manager lower and manage business factor costs while increasing cash flow and working capital





Account receivable financing in Canada
, via a business factor more often than not has the business owner/financial manager weighing the cost versus benefits of this method of growth financing. How can the owner/manager both reduce costs and enhance benefits. There are numerous ways... so let's dig in.

The ability to manage your receivables effectively, while maximizing the benefits of receivable finance is the ultimate ' business whammy'! Part of the reason is that the investment you have in A/R is often the largest liquidity component in your business. So managing that investment you make in sales will reflect directly on relations with your suppliers, lenders and clients.

We advise clients that they should also consider CONFIDENTIAL RECEIVABLE FINANCING which allows them to eliminate their clients from the whole notification process that is typically associated with traditional receivable financing that came to us from business practices in the U.K. and the United States. In Canada we're a little different, eh?!

When does account receivable financing via a business factor go awry? It's when the owner /manager considers it as a total cash flow machine, (which it is) but then lets other aspects of the company receivables investment get off track. So while they get immediate cash flow from A/R financing they become lax in collecting accounts, and granting credit. Remember that in the majority of ' Recourse' A/R financing in Canada you're still responsible for bad debts, so don't act like a drunken cowboy when granting credit, special terms, taking on ultra large orders, etc.

The opposite of all that is running your focus properly , combining the benefits of AR financing ( instant cash flow, unlimited working capital, ability to take on larger orders, easier approval than bank financing ) with proper Receivables management.

So what is that 'proper' management focus? It's:


A good credit granting policy
Proper collections and follow up on accounts
Good financing reporting on at least a monthly basis (i.e. aged accounts, etc)

Taking your month end a/r and determine how well you turn over current assets such as A/R and inventory should be ' JOB 1' when it comes to monitoring ongoing financial performance.

EXAMPLE: Your annual sales are 2,500,000.00 and your year end AR is 88.750$ -

That means you are turning your accounts over 28 times a year. The goal is to always make that number larger, relative to general benchmarks in your industry.

The classic benefit of account receivable financing in Canada is the ability to take on larger orders from credit worthy accounts, things that your competition might not be able to consider. They can't consider that because investing in new sales requires the cash investment in your current asset accounts that you could otherwise not make. So unless you're Apple Computer selling billions on a cash sale basis
it's a challenge that business owners in the SME COMMERCIAL area face everyday.

If you’re interested in turning your firm into a cash flow machine consider account receivable financing via a business factor firm in Canada. Seek out and speak to a trusted, credible and experienced Canadian business financing advisor who can assist you in matching A/R financing with solid ways to reduce the costs of that type of business finance.




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 = Account Receivable Finance Expertise