Is Your Company One To Take Advantage Of Receivable Financing ?
OVERVIEW – Information on the advantages of asset based invoice finance in Canada . Who offers receivable factoring and how does this business finance solution provide all the cash flow your business needs
Asset based invoice finance solutions , also known as ' receivable factoring / invoicing financing ' has become a ' steady as a fault ' business finance solution for thousands of Canadian businesses who utilize it as their main cash flow / working capital source . Why... and how? Let's dig in.
Thousands of businesses in Canada find it a challenge to manage their businesses from ' get up and go ' to a ' get up and grow ' stages. Firms that are new, smaller, or financially challenged in some way find it even more difficult...
So how does this all work? It’s simpler than you might think. Given that your accounts receivable are typically the largest next to liquid cash asset that your company has, this asset becomes your short term financing strategy. The result? With the right solution in place you're now in a position to meet payrolls, buy products and services, and... dare we say it... grow your business.
By ' pledging' your receivables as the asset you are ' monetizing ‘you’re in effect securing ongoing short term lending. Here it's important to emphasize though this is not a loan / debt scenario. The Receivable factoring paperwork/security documents position your company as selling your receivables as you generate sales to access the amount of cash flow you need.
While Canadian chartered banks have ' dabbled' in asset based invoice finance the reality is that on balance 99.9% of all receivable invoice financing is done via commercial finance firms who compete with the banks for your working capital business credit lines .
If it was all about price and rate the banks would win hands down, given that commercial receivable financing from factor firms is more expensive than those low bank rates. The reality though is that many businesses can't qualify for the amount of financing they need in part or whole.
If you're looking for some even better news in how these facilities working then consider looking into Confidential Receivable Financing, which allows you to garner all the benefits of ' traditional’.. aka ' old school' factoring but given you the power to do all the invoicing and collecting with no notice to your clients, suppliers, etc. This eliminates the ' notification' required by old school firms that insist your clients be notified of whets going on.
The majority of firms that utilized asset based invoice finance do this as a bridge to going back to accessing traditional bank capital. Typical current scenarios in their businesses include:
- An urgent requirement for cash flow
- Inability to get Canadian chartered bank financing
- Requiring more cash flow than is typically available
- High growth
- The requirement to carry higher levels of inventory and A/R
The formula for receivable factoring is quite simple:
Your receivables are eligible for 90% financing of your month end a/r for all accounts under 90 days (Note - if you have a/r over 90 days you probably have a bigger problem )
In summary receivable factoring is not a loan, brings no debt to your balance sheet, is easier to get approved, and allows you to grow in an almost unlimited manner as long as you have revenues that are stable or growing .
If you're suspecting that the bank financing you seek is somewhat remaining in the bank vaults seek out and speak to a trusted, credible and experienced Canadian business Financing Advisor with a track record of success who can assist you with ' steady to a fault ' financing solutions .
7 Park Avenue Financial :
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 . Info /Contact :
7 PARK AVENUE FINANCIAL = CANADIAN ASSET BASED INVOICE & RECEIVABLE FINANCING EXPERTISE
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
