Practical and Surprising Methods for Working Capital And Cash Flow Financing For Operating Funds For Canadian Business Owners

Canadian Business Cash Flow Alternatives


Information on working capital and cash flow solutions for operating funds for Canadian business owners and financial managers.


It should be no secret that SME firms that make up the majority of the Canadian economy face the same challenges as some of our larger corporations. Their ability to manage and successfully solve working capital and operating cash flow issues for business probably seems more daunting due to perceived lack of options and the resources to put those solutions in place.

Let’s examine how to address some of those challenges, and where help might lie.

The flow of funds into and out of your business ultimately determines the cash flow needs. That need is driven out of the requirement for you to run your business, pay your bills, produce products and services, and then wait... and hope?! .. to get paid on time.

One of the dangers of cash flow management and use is that it is tempting to use your working capital for fixed asset purchases. That’s not recommended of course, and it’s more viable to look at other methods of asset finance such as equipment finance or term loans for assets required to run your business. In many cases existing assets can also be refinanced for working capital.

The logical solution for additional cash flow needs is of course a bank line of credit, which you can successfully negotiate if your financial statements and personal finances support that type of facility. In higher growth situations more alternative methods of capital rising can be considered - they include purchase order financing, inventory only finance facilities, or the monetization of your tax credits. These are clear options when banks or other lenders require you to put in additional funds into your firm that may not be available from your personal resources. We definitely are always urging clients to try and separate their personal finances from their business assets as that just seems common sense to us... isnt it one of the reasons incorporation exists in the first place?

We encourage business owners and financial mangers to obtain asset financing for their business. As noted, this can come from the alternative sources we mentioned, which also might include receivable financing outside the bank, a true asset based lending facility that monetizes A/R, inventory and equipment into a revolving line of credit, etc. These sort of facilities work perfectly if your firm can’t meet the stringent requirements of traditional cash flow covenants. Banks and institutional cash flow lenders thoroughly investigate your firm’s ability to make payments via ratios and covenants that identify cash flow coverage and debt to equity ratios. If you can meet them... great... if you can’t... consider our alternatives .

Always focus on breaking down short term and long term needs. Short term really focuses solely around your A/R and inventory build up while long term debt is repaid via regular term payments over a long period of time

Our asset based line of credit solution that we referred to above is the optimal solution for asset based working capital and cash flow finance. Receivables are finance dup to 90% of your total A/R, and if your inventory can be fairly easily solid it can also be margined.

If your company is a bit larger towards the high end of the SME sector there are some great hybrid solutions such as mezzanine and subordinated debt solutions. You pay a higher rate for this type of financing, typically in the teens, from a rate point of view, but it is ultimately cheaper than selling permanent equity, particularly if you are bullish on your long term prospects.

Oh, and by the way, the most common sense solution to working capital and cash flow is simply prudent management of those current assets. Keep your profits in your firm, negotiate better terms with suppliers, and strive on a daily basis to reduce A/R and inventory levels. You've just become the savior of your own firm!

Speak to a trusted, credible and experienced Canadian business financing advisor on operating working capital and cash flow solutions for your business - there are more alternatives than you might be aware of!




ABOUT THE AUTHOR - STAN PROKOP

7 PARK AVENUE FINANCIAL

CANADIAN BUSINESS FINANCING !


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

Financing Equipment For Your Business? Canadian Leasing Options Demystified !

It’s Not Always About The Monthly Payment !


Information on financing equipment in Canada. Which leasing option is best for your business. Examining Finance alternatives for Canadian business owners who are acquiring assets.



Acquiring assets for your business, from plant equipment to the latest computing technology provides Canadian business owners and financial managers with growth and profit potential. But how much time do you spend on assessing the right business leasing options when financing equipment.

Let's examine the strengths, benefits, and yes, sometime drawbacks on your lease financing options.

We're of course assuming that you conquered the lease vs. buy decision and focused on leasing business assets for the obvious reasons we've discussed in the past: monthly payment flexibility, accessing business credit outside your established bank and other facilities, and using tax and accounting scenarios to your business advantage.

So that puts you there, at the fork in the road so to speak. Namely which type of business financing equipment lease works best, for you. It's actually not a large choice... it comes down to a capital lease or an operating lease. Understanding the make up of those two transactions makes you a winner when it comes to choosing which option works best for your firm.

Let's examine Capital Lease structures... and benefits. Prior to choosing a capital lease option you have a general sense that you wish to own the asset at the end of the lease term. The capital lease, aka ' lease to own ‘effectively transfers ownership to you at the end of the lease term. Hopefully you have picked the right term on your lease, matching use of the asset to a proper amortization. In Canada that typically is 2-5 years, sometimes longer depending on the asset type.

From an accounting perspective, since you have elected the lease to own strategy via a capital lease you are no win a position to both depreciate the asset as well as record it as an asset on your balance sheet. The equipment financing industry in Canada considers full payment of the rentals, i.e. the monthly payment as the full recovery of their cost plus profit, i.e. the interest rate on your lease.

As an aside clients are always asking us about rates on business equipment leasing. Rates vary widely in Canada. How widely? Anywhere from 5 - 25% per annum and boy is that a range. Clients are astounded when we advise them they get to pick their own rate! How can that be possible? Simply because your over all credit quality and the dollar size and type of asset dictates lease pricing. You have got to simply demonstrate that credit quality or address any concerns of the lessor.

But wait... didn’t we say there were two options for financing equipment. The other option is the FMV option, known as the operating lease. Payments will always be lower than a capital lease option, simply for one reason. That’s because the operating lease scenario assumes the opposite of ownership, and that’s ' use '. You want to use an asset, not acquire the responsibility, and risk, of ownership. The good news is that if it turns out you wish to purchase the asset that a properly constructed FMV lease will allow you to still exercise that right, at a fair price.

Confused about the right business leasing options available in Canada? Speak to a trusted, credible and experienced Canadian business financing advisor who can assist you in freeing up working capital and maximizing tax and accounting treatments for business asset finance in Canada.



ABOUT THE AUTHOR : STAN PROKOP - 7 Park Avenue Financial


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

Sources of Equipment Financing Loans In Canada – What Commercial Business Lenders Meet your need

Get Practical On Sources of Equipment Leasing For Canadian Business

Information on sources of equipment financing loans and leases in Canada . Commercial business finance options that make sense!


After Canadian business owners have made the decision to acquire assets for their business they are often faced with the choice of identifying the best 'source' of that financing.

Businesses lease or arrange commercial business loans for assets they need for ongoing operations. So who do you turn to for a financial option that makes sense - one that allows you to match cash outflows against the expected benefits of the asset you are acquiring?

In a perfect world, (and trust us we know its not!) you want to find a financing partner that has a good sense of what your business and your overall financial condition is about. Your ultimate goal should be to give your business a financing rate, term, structure and benefits that you deserve.

In one aspect of equipment financing loans in Canada we must regretfully report that ' size counts'! What do we mean by that ?Simply that the overall financing size of your commercial loan or lease dictates who your best financing partner will be . We advise clients that in Canada there are in effect 4 tiers of equpment financing size. They are as follows - large ticket, mid ticket, small ticket, and micro. When you know who the best players are in one of those four niches we believe you’re... to quote Charlie Sheen ' winning'!


Ever tried to put something in a box that doesn’t fit? It’s quite an unproductive task. That’s why we cringe when we see clients trying to put their box in a lease niche that doesn’t fit. The reality is that many Canadian businesses get the run around only because they have stumbled into the wrong niche. So whats our point, simply that the asset dollar size, type of asset and your overall credit and financial strength very quickly determine who you should be dealing with.

Credit quality is what business equipment financing loans are all about in commercial financing in Canada. Optimally you will get the best rate when you have a decent balance sheet, good cash flows, and a credible business history.

Unfortunately that doesn’t include thousands of business owners who have unpredictable cash flows, some historical operating issues, or who perhaps find themselves in an industry that is ' out of favor '. Does that mean you can’t be successful in commercial business leasing? Absolutely not , but it does mean that you are now in the category the industry terms as a ' story credit', and its up to you now to tell a good story . If you do that you will get a lease approval, but your transaction will be structured in some manner that affects the rate, term of the lease, or perhaps outside collateral, guarantees, etc.

So who exactly do you turn to for financing you need in equipment? The parties that are offering you financing today are captive vendors, banks (who really are into leasing these days) and independent specialized lease firms of all sizes, types, and ownership. (Many U.S. firms are key players in the Canadian business equipment financing arena.

Want to fast track lease financing approval, and ensure that you find yourself in the right niche and ticket size that we have outlined? Speak to a trusted, credible and experienced Canadian business financing advisor who will help you manage the process and identify your rights, obligations and key benefits. Get your 'best deal' with professional assistance, saving you time... and money.




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/equipment_financing_loans_business_commercial.html

You’ve Got Working Capital and Cash Flow Problems – We’ve got Canadian Business Financing Loan Solutions !

Working Capital Management Finance Strategies


Information on working capital and cash flow financing solutions in Canada via a business loan or asset monetization strategy .How Canadian small and medium sized firms finance themselves today.

It becomes evident at numerous times in the life of a business that some form of outside financing is needed. Let's look at some of the situations that your firm finds , or might find itself in and what types of Canadian oriented working capital and cash flow financing business loan solutions are available.


Some times the best problem is the worst problem - by that we mean that you are growing and growing quickly. Alternatively many clients we meet are experiencing some sort of challenge - it might be a financial loss in the current or previous year. And most commonly it’s a case of financing those current assets, i.e. A/R and inventory to bring in liquidity to the company for normal ongoing operations.

Three solutions are available to the Canadian business owner of financial manager. They include taking on more debt (not optimal or often desired), bringing in a partner for additional permanent equity and working capital, or, our favorite ' Monetization ' (Back to that one later)

If your company is not leveraged, or should we say over leveraged and can handle additional debt that is not necessarily a bad thing. For the majority of firms and industries in Canada a debt to equity ratio of 2 or 3: 1 is generally viewed as acceptable by the people that count. (Banks and other lenders!)

Raising private equity for a small to medium sized business is generally difficult and challenging in the Canadian business climate. We've seen numerous clients take the public financing route via a reverse takeover or utilizing a capital pool... our simple observation on that ?... In general things never seem to work out! Let's leave it at that.

When studies look at how small and medium size borrowers really do borrow in Canada it probably isn’t shocking to our clients that a huge majority of debt comes from credit cards, the BIL Government loan, personal savings of the owner, loans from friends and family, , etc . Generally only 35% or so of business in Canada in the SME sector gets the financing they needs from traditional bank financing, due mainly to the requirements that Canadian commercial banks impose on company borrowers and their owners personally. (By the way, we love Canadian banks... its just that sometimes there is a better way)

We mentioned that working capital solutions for cash flow financing can come not from borrowing, but from monetization of current and fixed assets. That’s why be spend a lot of time with clients explaining the different benefits and costs associated with : bank lines of credit, non-bank lines of credit , a/r and inventory working capital facilities , true ABL ( asset based lines of credit) facilities , confidential receivable discounting .

In additional many previously viewed ' alternative solutions ' are becoming more mainstream everyday. They include purchase order and contract financing, tax credit financing, securitization, etc.

So, do you have a working capital or cash flow financing business loan challenge? Invest some time in real world Canadian solutions. Seek and speak to a trusted, credible and experienced Canadian business financing advisor who can assist you in addressing current and perhaps future financing challenges.



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/working_capital_cash_flow_financing_business_loan.html

Looking For Canadian SBL Loans From The Government For Your Business? There's No Substitute For Good Information!

Successfully working the Maze of The Government Small Business Loan


Information on the business loans from the government in Canada . Why the SBL small business financing program is right for your firm, if you know the approval process!


Boy do we get a lot of questions around the subject of loans from the government. The SBL (Small Business Loan) for your business just might be the ' tipping point ' between success and failure for the financing of your new of established business.

So why is this financing so great, let's help you clarify that question... and finally, there is so much mis-information about the program that we thought we would share with you the ' straight goods' on the program. Let's get started!
There is a feeling among many clients that it takes a long amount of time to get both approved and funded on SBL loans. That depends only on one thing... you! We make a strong point with clients that if they are prepared and can meet the fundamental criteria of the program then a relatively small amount of planning (with some expert help) can get you approved within a week or so. That’s a far cry from the weeks and months that many business owners and entrepreneurs tell us they have spent muddling their way through the program.
So why do we maintain that its a matter of days when in fact your own experience might be otherwise .Enter the Boy Scout Motto ...' Be Prepared'! If you spend a bit of time ensuring you qualify for the program (we’ll share those qualifications in a moment ' then the preparation of a simple package of info confirming those qualifications will get you to the goal line. And by goal line we mean loan approval and funding.

Qualifications for the program are as follows - you must be a Canadian citizen or eligible to legally borrow in Canada. You also need to have a reasonable personal credit history. Banks that administer the program for the government use a scoring system from the credit bureau, and if you have the pre requisite score that helps ensure approval.
You should also be prepared to detail your financing via a business plan or strong executive summary. If you don’t have the ability, experience or time to prepare such a document then one can easily be prepared for you by an experienced Canadian business financing advisor.

And what is in that ' plan’... it’s not as complicated as you think. It's info regarding yourself, your business experience, the asset or assets or business description you are financing (it can be a restaurant, manufacturing equipment, a purchase of a business, etc). Most importantly we feel is the financial plan you attach to your request.

The financial plan should show the sales, costs, and cash flows of the business... with emphasis on reality and conservatism and ensuring the cash flows show good repayment of the SBL business loan. SBL loans from the government are administered by the bank and both the bank the government (for some reason!) wish to see that they will be repaid!

So our bottom line is that with some expert info and assistance you can be sure that you have a very strong chance of being approved for the government small business loan. We encourage all clients to investigate the program, as rates, terms and structures are excellent for any small to medium sized (Sales under 5 million) business.

Ever felt that some expert assistance in any aspect of your business can get you to where you need to be faster? Seek and speak to a trusted, credible and experienced Canadian business financing advisor who can show you the fast track method of achieving approval on SBL loans from the government for your business venture.



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/loans_from_the_government_sbl_business.html

Suffering From Bank Lines of Credit Amnesia ? Canadian ABL Asset Finance Business Lines Facilities Could Be Your Cure !

Are You Bold Enough To Consider The Newest Type of Canadian Business Financing?


Information on ABL asset finance revolving credit facilities in Canada . Business bank lines of credit without the bank ? ! Why this method of asset finance revolving credit will work for your firm .


It's probably just us, but we recently pondered the fact that many clients we meet are suffering from what might be called ' selective amnesia ‘... a ' loss of inter-related memories ' . It appears to be in conjunction with forgetting what is was like to have business bank lines of credit. Have they disappeared? Weren’t they relatively easy to get? Didn’t they always cover off all the working capital you needed?

Today ours is not to debate, defend or promote Canadian chartered bank lines (by the way, we love Canadian banks) but instead to ensure Canadian business owners and financial managers understand a very solid...we repeat ' solid ' alternative, namely ABL asset finance lines of credit.

Asset finance lenders in Canada provide lines of credit to Canadian businesses of all size. In truth we would say that the more assets your firm has the larger the facility is available and somewhat easier to get, but companies of all size, including start ups by the way, are immediately eligible.

In many cases asset based line of credit facilities either replace bank financing or are a first source of working capital lines for Canadian business. We can't over emphasize the fact that even companies in bankruptcy, receivership, or who are in the unfortunate position of being in ' special loans ( we know ... it’s not that special!)are always eligible for ABL asset finance facilities.

We also point out to clients that just because ABL facilities consider firms that are in some way troubled or challenged that they should never always be viewed as the ' lender of last resort' financing . How can we prove this to you? Simply by advising you that many of the largest corporations in Canada are financed by this bank alternative, and companies who utilize asset based lines of credit because they have been punished elsewhere for ' hyper growth ' often find themselves solicited by banks again for their commercial credit lines. Go figure!

So yes, your firm does qualify for working capital ABL asset finance lines of credit if you have financial losses, shareholder equity issues, CRA arrears, etc, it's just that the facility will be structured a bit differently in terms of rate and structure.

Clients often ask about pricing on asset based credit lines... its a difficult question for us to answer because depending on the type and size and quality of your a/r and inventory and your overall general financial health our ABL financing alternative is priced better than, equal to, or substantially higher .It would seem we have covered off all the bases!

Bottom line on ABL financing... it works, it’s an accepted alternative and if you find yourself suffering form that ' selective amnesia ' on the ' old days ' of business banking then barrel in to the new kid on the block. Speak to a trusted, credible, and experienced Canadian business financing advisor who can assist you in identifying the benefits of this great working capital facility.



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/business_bank_lines_of_credit_abl_asset_finance.html

Looking For Canadian Business Financing & Lending - Commercial Finance Company Options

Facts and Resources for Canadian Business Financing Options

Information on why business financing in Canada involves the proper selection of a commercial finance company for refinements to your current business finance strategy .



In Canada business owners and financial managers have an assortment of specialized finance companies that provide a broad level of financing products, all of them different in nature, so let’s examine why a certain commercial financing company might be your best logical choice for financing your business needs.

The good news is that Canada has hundreds of different and specialized financing sources... in fact we think quite often that our clients main challenge is simply identifying who those sources are and matching their finance offerings to their own specific needs . Some organizations are actually very significant entities and offer a broader subset of business financing less than one roof.

In order to determine the right commercial finance firm it is essential to think senior, or junior. What do we mean by that? Simply that if you are entertaining a senior debt facility it must be recognized by the business owner that that lender requires an overall first security position on the asset or assets being financed . Canadian banks do that well by an all encompassing document known as a General Security Agreement.

In many cases you the business owner aren’t seeking term debt, but an operating credit line. That type of facility in Canada is available from a Canadian chartered bank, but more and more corporations are going against the grain so to speak and seeking out an Asset Based Line (ABL) of Credit that allows them to draw on current assets with numerous other flexibilities.

Numerous boutique commercial loan firms in Canada provide temporary ' bridge ' loans... you guessed it , they are a ' bridge ' to a future re financing of certain assets .

In the U.S. there is a huge industry revolving around what is known as 2nd lien debt... simply speaking a second charge behind the first charge of any asset? This type of financing in Canada is somewhat rare, if not available at all.

There are some great hybrid vehicles... and we're not talking cars here! These hybrid business financing offers take on a senior debt position, at the same time structuring some equity participation for the lender. Talk about a lender that motivated to help your firm! We hasten to add also that these types of arrangements can also be facilitated with privately controlled companies, not public entities as might be assumed.

Leasing companies in Canada are highly specialized asset lenders that finance every type of asset imaginable, even patents and technologies n some cases. Many firms take the leasing industry scenario one step further, and finance assets a sale leaseback basis, providing additional cash flow to existing owned assets.

A somewhat robust VC and Private Equity industry also exists in the Canadian business financing landscape. They facilitate growth, re financing, going private, going public and very specialized scenarios.

Numerous firms in Canada utilize merchant banks - these again are specialized firms that bring capital into your business, along with their own. They are compensated in the form of fees, and of course equity ownership with respect to any direct investment in your firm.

Bottom line. Pretty clear we think. If you are looking for a commercial finance company you've got numerous choices, they might be debt, equity, or hybrid financings. Business financing made simple, if you've got some expert guidance in place that places your needs and your own particular situation at the top of the priority list!
Seek and speak to a trusted, credible and experienced Canadian business financing advisor when looking for a commercial finance company in Canada.



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/commercial_finance_company_financing_business.html

A Common Sense Way To Choose Canadian Business Leasing Companies For Equipment Loans – A Lease & Loan Alternative

Make the Right Choice for Lease Finance in Canada



Information for Canadian business on choosing the best method to select leasing companies for equipment loans – A lease and loan alternative selection process .




Rest assured you're in the same boat as thousands of your competitors - and whats that boat about? Simply not knowing who or what to turn to when selecting business leasing companies for an equipment loan for your business. More importantly, leases and loans that makes sense, not the kind where you wonder if your firm got a transaction at market rates, terms, and structures.

So is there a fast track to selecting the right lease finance company for asset financing that works, and makes sense? There are a couple of challenges we try and help clients overcome, not the least of which is the fact that there are tens and literally hundreds of firms all across Canada that ' seemingly ' fit your needs. And, and it’s a big and... if you have all the time in the world to develop relationships with these hundreds of firms, well then... let’s just say we're jealous!

But not knowing who to turn to can in fact, as many clients have experienced, cost you tens and thousands of dollars, depending on your past experience with leasing companies in Canada. One alternative is of course to send a lease bid document out to a large number or select number of parties. That makes sense for government agencies and large corporations probably, but not for small and medium sized businesses in Canada.

The reality is that all those lessors out there have their own unique business models, and are you ready... because this could be painful... they are going to try and fit your firm in a box . In a box? We're talking about the ' credit box ‘... that elusive credit policy that seems to be understood, by the lessor, but not perhaps yourself. You see each firm (who by that way had to go out and borrow money to lend it to you) has a credit box. In that box is a set of criteria around asset types, deal sizes, ratios, covenants, personal guarantees, outside collateral, years in business... well we think you get the drill

And oh yes, if there were one type of business equipment leasing company in Canada the search for asset financing might not be so daunting. In reality those hundreds of different firms are actually in 4 sub categories.

Those sub categories are bank lessors, independent leasing companies, captives (ouch! that even sounds painful - do they have a box also?) , and insurance companies.

So do we have a favorite and a recommended solution for each and every business owner and financial manager in Canada? Actually we do its number 5 in our list of 4! We're talking about an independent, experienced, trusted, and credible Canadian business financing advisor... one who should be an expert in lease financing. Utilize their experience for market knowledge, eliminating financing sourcing time, and ensuring you are getting market rates in the current low interest rate environment of 2011 where in fact lease financing is very competitive and wants your business. Adding value and saving your firm money is a powerful double punch in Canadian asset financing.




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/leasing_companies_equipment_loan_loans_business.html

Don’t Let Business Franchise Financing Approval Stop your Start Up Or Restaurant Dream In Canada

The Secret To Business Franchise Start Up Loans For Canadian Entrepreneurs



Information on business franchise financing in Canada . Whether it’s a restaurant or other type of business, start up, or established you have financing options to ensure success.



You're there... almost. You've made the decision to buy a business - it could be a restaurant or any other business for that matter. So let’s make sure franchise financing is not going to hold you back on realization of your dream and vision as a Canadian entrepreneur.

So how exactly do you find the funds you need. It's actually a process of careful planning around the type of financing that suits your purchase, and finding and working with the right lender to ensure the business is finance properly. Naturally planning and demonstrating you have thought out the financing is key also.

In terms of franchise financing your business - again it could be a restaurant, or one of the hundreds of other franchising opportunities out there in the Canadian marketplace... its important to break down the total financing need into categories, because in most cases each ' category' of your requirement is financed a bit differently . As an example the working capital component, what you need to run the business on an on going basis is usually financed by a traditional offering such as a business line of credit, or business credit cards if it’s a smaller business.

We encourage clients to cover the actual franchise fee out of their own equity contribution to the business, as it's challenging, if not impossible in the Canadian marketplace to finance your actually franchise fees. Items such as equipment, leasehold improvements, software, point of sale systems, etc are very financeable. And truth to be told these items make up the bulk of your financing needs more often than not.

Franchise financing around your business is in fact a 'niche ' or specialized sector in Canada. But the reality is that many of the same principles apply to financing your start up, restaurant purchase, or any other business for that manner.

What then are some of the basics around the process that allow you to get to the financing goal line... successfully! Items such as having a handle on your personal net worth and knowing what you maximum equity contribution to the business will be in terms of your personal financial situation are important.

We won’t say it's impossible, but the reali8ty is that you must have a decent personal credit score and history to be considered for franchise financing for your chosen business. The entire credit history of every Canadian is actually based on one number called a beacon score, and you require a certain ' beacon ' to be approved for business or for that matter any other type of financing. Bottom line, obtain your score and understand how it fits into the big picture.

In your business plan or executive summary ensure you focus on key items such as the following - info on your own experience, information on the industry and type of business you re purchasing, and finally . Perhaps most important, a financial projection.

Ensure that financial projection makes sense from a viewpoint of reasonable profit expectations - with a focus also on how your loan financing will be paid back. The reality is that this document and how it is presented can make or break your financing approval.

While financing in some form could be provided by your franchisor, this in our experience is very rare - they are selling franchises, not borrowing funds to allow you to borrow from them. So review carefully, with professional assistance, your key financing options - these include the specialized BIL/CSBF loan, equipment financing tailored to your asset needs, and working capital options that might come in a variety of financing ' flavours'.

You have a good chance of accelerating your approval by working with an expert - that works in all manners of business. So seek a trusted, credible and experienced Canadian business financing advisor who can assist you in turning the business ownership dream into financial reality.



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 .Info re: Canadian business financing & contact details :

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

The Choice Is Yours – A Canadian Bank Line Of Credit – Or Alternatives To A Business Operating Line

Lawyers, Guns and Money - You need neither of these to ensure you have access to a Canadian bank line of credit. We simply love that term, it’s actually the title of a great song by Warren Zevon.

But you do need to ensure you understand the difference between a business line of credit in Canada, what you need to qualify, and how these facilities work. More importantly, are there alternatives to this type of operating line financing. There are!

Naturally Canadian chartered banks are the first stop in a business owners or financial managers mind when determining a source of operating financing and working capital.

From a banks perspective it’s a very strong focus on your ability to achieve the amount of operating credit you need - secondary to that of course comes your overall collateral.

It's sometime easy to forget why bank credit is sometimes difficult to obtain - we sometime forget to focus on the fact that our banks in Canada have to obtain the right capital base relative to what they lend - they have their own issues relative to profits and maintaining liquidity. That then affects your business, because your collateral, cash flow, collateral and guarantees directly impact your ability to access their credit facilities.

Unfortunately many clients often find themselves placed into a ' non performing' loan status because your financials don’t fit into what the bank considers a performing well loan. The reality is that if your business is growing you are using cash, not generating it, and that becomes a prime challenge in getting the amount of business credit you need.

It's a bit of a balance act at all times of course, the irony is that bank interest rates on a business operating line of credit are absolutely the lowest cost of financing in Canada .

We have often thought that the actual ratios and financial covenants that come with bank credit are much more important than the Canadian business owners need to get the absolutely lowest rate in bank financing - typically that is 1-2% over prime. You never want to be caught in the trap of managing your business because of what your bank covenants say.

For small and medium sized businesses in Canada the issue of personal and even spousal guarantees becomes a large one. Canadian chartered banks want to ensure you maintain that repayment responsibility - unfortunately the guarantee is one way of doing that. Many Canadian business owners therefore take great care to separate their business and personal lives when it comes to assets.

So, if a bank is the absolute low cost financing for a business operating line of credit is there any better alternative? There definitely is and it’s called an ABL (asset based line) revolver .Its specialty business financing, focusing on your firm’s assets, not your cash flow or personal guarantees or outside external collateral.

ABL lending facilities can give you all the financing a bank line of credit then. Rates are often competitive, but in many cases more costly. But at the same time you're managing and growing your business, not reacting to ratios and loan covenants.

Want clarity on a bank line of credit, or its alternative, an ABL facility? Seek out and speak to a trusted, credible an experienced Canadian business financing advisor who can assist you in the completion of either facility.




7 PARK AVENUE FINANCIAL
Canadian Business Financing
http://www.7parkavenuefinancial.com/bank_line_of_credit_business_operating_line.html

Paying Too Much For Canadian Accounts Receivables Factoring ? A/R Financing Pricing Revealed !

Over paying is never a good thing, so our clients who have adopted a business financing accounts receivables factoring strategy can , we think, be forgiven for trying to understand, and rationalize how pricing works in this type of financing .

Let's examine some key fundamentals on how factoring pricing is achieved in Canada, and how you can ensure you have received the best pricing. You have made the decision to accelerate your working capital and growth needs by embracing an A/R financing strategy.

Congratulations, as you've made the savvy decision to avoid taking on more debt, or necessitate the need to bring in extra equity or even, worst case, dilute your current ownership by having to bring in a partner or investor, etc.

When clients ask us the most basic questions, such as ' why should we consider business accounts receivables factoring financing we use a simple example that simply illustrates what the potential here is for this type of financing , ( Once you have rationalized the cost ). That example is that you have in effect turned your company into an automatic teller machine, creating unlimited working capital as your sales grow... Even the big boys wrestle with that one, so congrats!

And speaking of those big boys, clients are always surprised to hear that some of the largest corporations in Canada utilize this method of financing.

So back to our core subject of course, which is both understanding, controlling, and feeling you have been able to choose the most effective pricing for A/R financing.

Several issues come into play. In general when you utilize this type of financing your own firms general credit worthiness does not come into play, because it is your assets - i.e. the receivables! that are being financed. So our first point is simply size, in that you can do a factoring (aka invoice discounting facility) for 15k a month, or 15 Million a month. However, speaking in general terms small and medium sized firms in Canada have been paying between 1-3% on a 30 day basis for financing receivables in a ' traditional' type of facility. If you are paying anything more than that you in general do not have a competitive offer - so try and change that!

What do we mean by traditional? Simply that Canada was for many years slow to catch on to A/R financing strategies, so the industry is somewhat dominated by U.S. and British firms, even on our own soil. Their facilities are structured similarly all over the world, which is one of the reasons we have never favored them as ' optimal ' for Canadian firms. Our own preference on financing A/R is a system known as C I D, confidential invoice discounting, which allows you to bill and collect our own receivables, without any notification to your customers or your suppliers.

And when it comes to pricing mis information exists out there that this type of facility (C I D) costs more. It does not. We repeat, it does not.

Is it possible for the Canadian business owner and financial manager to wrestle down the basics of how accounts receivable factoring business financing is priced? It sure is. You only have to know three things, the advance rate, the actual discount or purchase fee, and the time in which the invoice will be paid.

We hasten to point out that you in effect have control over one of the three critical factors that affects A/R financing pricing. That’s the time to collect, since the less time the invoice is outstanding means your pricing just got better. Simple as that.

Percentage advance is a different story, its one of the factors you can't control, and it’s simply the amount the finance firm advances you on each invoice. In general 90% is a typical advance rate, meaning simply that you get on day one 90% of the invoice amount as instant cash flow - the other 10% is remitted to you when your customer pays.

Other ways you can both understand and affect pricing are by watching miscellaneous items that can add up. They include nominal amounts such as set up costs, wire transfer costs, admin charges, etc. Make sure to calculate them in your overall pricing, and negotiate hard, when you can to reduce these charges.

So whats the bottom line. Simply that the factoring firm, i.e. the lender, has only one goal, make larger returns on your receivables. By understanding how this pricing is achieved, negotiating on items that you can, and then monitoring your A/R aggressively... well we think you get the picture, you are in a postion to ensure you are not paying too much for this valuable financing.

Want some expert advice on this subject, that’s easy also, seek a trusted, credible and experienced Canadian business financing advisor who can assist you to ensure you have achieved best pricing available.

P.S. Congrats on your new ATM machine!





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 .Info re: Canadian business financing & contact details :

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

A Practical Cash Flow Loan ? What Type Of Working Capital Company Can Help Your Canadian Business

Practical - it refers to good judgment in action. That type of common sense definition is what Canadian business owners and financial managers seek everyday when they are faced with locating a cash flow loan or facility.

And it becomes a bit more complicated when they don’t necessarily know what type of working capital company is the optimal solution for their business needs .Lets shed some light on that subject with real world experience backing it up.

Naturally just the creation of additional sales revenue creates profit for your firm, but it’s clear to every business owner that is simply not enough, given the investment you then have made in current asset accounts such as receivables and inventory.

One Canadian solution available is the conversion of short term debt into long term debt via a working capital term loan. This creates a long term working capital component to your financial structure. Small and medium sizes firms can source this type of solution via a government related bank - larger firms can utilize mezzanine or subordinated debt type financing to accomplish the same goal... only from a larger perspective.

Not often thought of as a cash flow loan, but in reality it is the creation of a sale leaseback for assets your already own. You in effect sell the assets to a lessor or working capital company and create a similar cash flow loan along the lines of the term loan we had reference above. All these solutions achieve the same goal.

Probably the most popular method today of generating cash flow is the sale of receivables via a factoring or securitization type facility. The good news for Canadian business is that this type of financing is available for a 10k solution as well as a 10 Million dollar solution.

We seem to be continually explaining this type of solution to clients, and it’s frankly quite simple to understand. It’s your selling of your receivables as you generate them for cash flow... today. What makes it complicated, and we're not to proud of it we can assure you, is how the working capital company sometimes complicates things around how this whole process works, what it costs, and how it affects your company on a day to day basis.


When you exactly face the decision to go out and look for more working capital. Really it fundamentally comes down to three areas, starting a business, growing your business rapidly, and then simply financing those day to day activities because for some reason cash flow is failing you.

You have clear options in the Canadian business financing environment .Its a questions of knowing those alternatives and determining what is achievable based on your unique needs. Very typical fundamentals you should have under your belt are up to date financials, a strong sense of your cash flow needs (via a cash flow budget) and some ' education' on what facilities are available for a firm of your size and credit quality.

The premier working capital and cash flow loan solutions in Canada are as follows - receivable financing, a working capital facility that combines A/R and inventory, or a true asset based lending arrangement which replaces a bank facility but gives you higher borrowing margins. We of course also touched on the cash flow term loan earlier.

Three more esoteric ( but totally viable ) financing solutions for your business are purchase order financing, inventory loans, and financing your tax credits if you have access to them.

Complicated? It doesn’t have to be. Seek a trusted, credible an experienced Canadian business financing advisor who can assist in clarifying individual solutions to your practical business 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 7 years - has completed in excess of 80 Million $$ of financing for Canadian corporations .Info re: Canadian business financing & contact details :

http://www.parkavenuefinancial.com/cash_flow_loan_working_capital_company_business.html

Your Choice - Right Way / Wrong way ? Canadian Accounts Receivable Financing & Business Factoring

Avoiding the wrong way to do something in business is always desirable, who wouldn’t agree on that?

So when it comes to business financing and in particular accounts receivable financing and business factoring lets examine how doing things the right way will save you time , money , and in general give you a strong sense of comfort that you have made the right business financing decision .

Canadian business owners and financial managers who have chosen a/r financing as a cash flow strategy need to understand where they can go wrong, and take that other path! You do that by making the right business finance decisions in three areas - understanding how accounts receivable pricing works, ensuring you have the best facility in place , and finally, by default , feeling confident you have picked the best business factoring partner .

Let's dig in therefore! There is no business financing that is more misunderstood that A/R factoring. And it’s actually not hard to get the basics under your belt. The concept of time and cost is critical in factor pricing. When you sell your receivables and receive cash the same day you understand of course that the longer that receivable is uncollected... well your financing costs are going up.

We recommend C I D as the most preferred type of accounts receivable financing. It's the most logical Canadian solution, or the ' right way ‘. C I D is ' confidential invoice discounting ' - it’s your version of ' mind your own business’! Under confidential invoice discounting you bill and collect your own receivables. Unlike your competitors who use this type of financing - where their clients are put on notice that your competitor has chose to finance their receivables via a non bank solution. But, remember of course that in business factoring never has ' time means money ' been so important, so even though you are billing and collecting your own receivables focus on operational collection policies that allow you to maximize cash flow and lower financing costs .

The ' right way ' around this type of business financing should focus on picking your best partner firm that suits your overall needs. The facility you pick, and the partner that finances it for your company will make or break your success in this type of Canadian business finance.

The landscape in Canada is littered with many firms who are non Canadian, charge too much, disguise their inherent financing fee with all sorts of small administrative charges that add up, and finally, as we noted, insist that they are between you and your customer with respect to collections.

So is there a simple route to taking the right way when it comes to A/R finance. Consider a simple , safe solution by simply seeking a trusted Canadian business financing advisor - someone who understands the business factoring landscape, will recommend and put you in the right facility, and ensure that the cash flow and working capital benefits associated with this type of financing are focused solely on your firm.



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 .Info re: Canadian business financing & contact details :

http://www.parkavenuefinancial.com/accounts_receivable_financing_factoring_business.html

Looking For Finance For Lease Equipment ? Which Canadian Business Lease Companies You Should Use

It's probably a common decision that you have to make all the time in business . First of all you have to choose between purchasing an asset and alternatively looking for business finance for lease solution... one that works for your firm.

Let's examine why you should consider and equipment lease as a Canadian business financing solution, and then, as importantly , how do you find the right lease companies to work with . (We’re assuming you don’t have all the time in the world to do this).

If capital was scarce in the past, boy did it become a lot scarcer in the last couple years with all our recessions and global financial implosions. So therefore for that reason alone it probably makes sense to lease business equipment and other assets.

But lets be clear first on ensuring you understand how the benefits of leasing clearly at the same time restrict you in a certain manner - simply speaking it will probably cost you a bit more ,and while an owned asset can be sold you clearly cant sell a leased asset . But we always seem to come back to ' cash is king, and your ability to acquire an expensive, yet revenue and profit producing asset via a monthly payment you can afford makes sense most of the time.

What factors should you consider when you assess your lease vs. buy transaction, even way before you determine which business lease companies you will utilize? You should focus on the following: what will the asset be worth and will it be still useful at the end of a lease term, what the best pricing is and overalls structure you can achieve, and finally, what tax and balance sheet benefits might come out of your finance for lease decision.

Let's use a real world example - Computers. They certainly have very short productive lives based on changing technology. So your decision is really as follows : If you think a 100k computer system will last 5 years should you pay cash or would it be better to pay 2000/mo or 24k per annum to lease this type of asset .

First of all we haven't met a computer that’s lasted 5 years !!,, but putting that aside you can see how cash outflows and monthly payment analysis play a key role in your overall decision .In our case the computer doesn’t really generate profits or cash flow . Remember the old saying ‘the bottom line is on the bottom of the income statement, not at the top of the balance sheet!

So let’s agree you have made the decision to finance business equipment or assets. Now what?

In Canada your choices are significant - that’s a double edged sword though. You can investigate captive finance firms, independent lease companies, bank leasing firms, and specialized niche lessors. If you started tomorrow you'd probably have a thorough decision made in a year from now. What's that...? Not a good use of your time? We agree, so consider speaking to a trusted, credible and experienced Canadian business financing advisor. You'll be guided very quickly to an equipment business lease financing solution that maximizes benefits of lease finance specifically for your situation - at rates terms and structures that match your credit quality and the nature of the asset you're financing.

P.S. Remember what famed investor Harold Geneen once said ‘the only irreparable mistake in business is to run out of cash '. Use a finance for lease solution that won’t take you out of the cash flow and working capital game.



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 .Info re: Canadian business financing & contact details :

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

A Shortcut To Leasing Equipment And Business Finance Lease Solutions & Services In Canada

Isn't any shortcut in business better? As shortcut is of course a ‘method or procedure that reduces time or energy and still accomplishes something ‘. Is it just us but isn't any Canadian business financing shortcut absolute good thing, as well as an advantage over your competition?

We're going to cover off some great shortcuts for leasing equipment in Canada, and how the ability to get a business finance lease with the best rates, terms and structures becomes a financing services victory for your company.

Also, when you can add a host of other programs services and structuring that are uniquely suited to your business... well... clearly that’s a win.

Doesn't it make sense to know what you are looking for prior to going out to get it - that's our first shortcut tip - determine whether you need an off the shelf lease financing services solution, or whether a customized business leasing equpment solution is required . A simple way to achieve this shortcut is to focus on the 5 elements of a lease, and which ones need special attention for a finance lease based on your company circumstances.

What are those key elements - simply the term of the lease, the interest rate associated with your credit quality, the size of your transaction, the monthly payment your cash flow budget can afford, and finally the end of term option that again, best suits your firms needs.

That's a mouthful, but most Canadian business owners and financial managers don't realize they have the ability to influence, and in some cases negotiate some of the key five elements - thereby creating your shortcut to leasing equipment finance success.

Let's delve into that further. Let's assume you know the asset or equpment that you want - you've evaluated your requirements and want a financing services program that best suits your company.

Now its time to take work on getting the flexibility you need to maximize those financial advantages. They include of course full financing of your asset with minimal or no down payment, flexible monthly payments geared to your cash flow and working capital concerns, the ability to use off balance sheet financing if you need it , or even in many cases generate a positive cash flow by leasing back equipment you own already .

In many cases you can achieve a quick shortcut to lease financing approval by working with your lessor on a term that works for both of you - it has to be a win win situation. On your side you want to match payments to economic benefits of the asset you are financing... the lessor is more concerned with asset value deterioration and your overall all credit worthiness.

If you are generally familiar with the finance lease business and leasing equipment industry in Canada you know it consists of a multitude of players , they all have different ownership , some foreign, they have different asset needs, and their pricing they provide you with is based on , guess what, their own borrowing practices !

The shortcut to best pricing and best structure is therefore knowing what leasing finance firm has the best appetite and expertise to provide you with a business finance approval that works .

In summary, if you want to achieve shortcuts in business financing services related to leasing equipment you would do well to speak to a trusted, credible and experienced Canadian business financing advisor who knows the business and will accelerate the shortcut to best asset financing you can hope to achieve .



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 50 Million $$ of financing for Canadian corporations .Info re: Canadian business financing & contact details :

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

How To Work With The Best Canadian Leasing Companies In Business Financing and Financial Services ?

As a business owner you love informed choices. When you are looking for asset acquisition via equipment financing you need leasing companies and business financial services advice on the best way to achieve finance success - and that requires being informed on equipment leasing.

So whats the scoop on the current equipment finance situation in Canada? Most business owners know that the ability to achieve the business financing you need became extremely difficult over the last couple years. Leasing companies were affected just like others - in fact many companies disappeared, were bought up, and most importantly, lost critical sources of their own funding - the bottom line..? They were looking for financing just like you!

The good news. You may have even seen the commercials ' Leasing is back!’. Those commercial refer to auto leasing, we're talking today about fixed asset financing for your Canadian company - and that includes everything from machinery to technology to heavy equipment, software, office equipment, you name it .. Our last transaction was for school buses..!

So, if leasing companies are back, let's just ensure you have a solid understanding of the benefits of lease business financing and, more importantly, who you should be working with.

Asset Financial services via leasing is simple - its a ' loan ' in which your leasing company purchases the equipment for you ( or from you.. via n equipment lease back ) and then of course leases it back to you at a monthly rate for a specific period .

Is it appropriate for your firm? Thousands of companies utilize this form of business financing everyday, in fact stats show over 80%! Another great thing about the best leasing companies in Canada is simply their ability to finance any asset for firms of any size, including start up.

The best Canadian leasing companies tend to differentiate themselves by the customer market they tend to specialize in - In Canada the industry is dominated by captive finance companies ( firms which lease only their parent company products and services ) as well as segments devoted to small ticket, mid ticket and large ticket asset financing.

We have always felt that the best firms provide quick turnaround on approval that seems to be a key focus for many clients looking for quick approvals for their asset finance needs. So ensure you understand the approval process, which typically is just an application, and, if the size of the transaction requires, your firm’s financial statements which are revived for only purpose - ensuring you have the ability to pay back the lease!

Your best leasing companies in Canada will ensure you understand the cost of financing. That cost is a mystery to many business owners and a frustration to even more. Buts it's really quite simple, it’s the interest rate inherent in the lease, as well as any purchase options or obligations at the end of the lease, and finally, any misc costs or admin costs identified in your transaction.

So how do you find the best leasing companies in financial services in Canada? We recommend that you seek the help of at trusted, credible and experience Canadian business financing advisor in business financial services. That will allow you to get a competitive quote, as well as achieving the best structure to your deal . He or she has solid intimate knowledge of the equipment lease industry in Canada and therefore has the ability to generate savings based on overall rate, term and structure of your transaction.



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 50 Million $$ of financing for Canadian corporations .Info re: Canadian business financing & contact details :

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

Going It Alone In Canadian Franchise Loan Financing ? Business Franchising Loans

Don’t listen to them. Many will of course tell you it might be dangerous to ' go it alone ' when you are looking for franchising financing loans.

Can you actually get a business franchise loan without any outside help? Its certainly , possible , and we'll share some advice, tips, strategies and info around your potential do it yourself strategy - but we'll also demonstrate why some professional assistance along the way will ensure the success you are looking for in your franchise business acquisition .

There are of course some real potential pitfalls along the way on your road to franchising success. You want to be sure of course, to the extent that you can be, that your business will be profitable. But all business is of course a risk, whether it’s General Motors or your vision of your own service or restaurant business as an example. It is critical to make the most of the opportunities you have to examine profit potential. Those profits by the way are of course what pay back those franchise finance loans!

Along the way on your franchise journey you have numerous methods of determining financial success. A good start is looking closely at your franchisors prospectus and information, - even though that info might be for ' average ‘ franchisees it gives you a good sense of profit potential versus risk .

Don’t forget of course that your risk is that you are no only borrowing funds for the franchise but that your own personal equity injection into the business is a key part of the overall franchise financing package you will eventually come up with . So work to minimize the risk of franchise business failure.

Get your costs in order and understood. That’s some of the best advice we can provide. We advise clients to look at the total picture, which includes soft costs and hard costs, some of which can be financed, not all. Typically we recommend your owner equity be used to cover those ' soft costs' such as the franchise fee, etc.

Try also to match revenues with expenses - it might make perfect sense to lease some of those ' hard assets ' in the franchise to match the economic benefits you will receive from those assets with the useful economic life of the asset. Want a simple explanation of that? Example: If you're starting a restaurant and a large fridge or cooler is, say 75,000.00 doesn’t it make sense to finance that at say 2k per month on a lease as opposed to using valuable equity and working capital and paying cash. We think so. Wouldn’t you?

So how are franchises actually financing in Canada. We focus on a total package that might include a franchise term loan, a working capital loan, and the appropriate amount of external financing through a financial vehicle such as an equipment lease. Here's the big surprise in Canadian franchise loan financing - simply that the majority of franchises are financed with the government loan program called the BIL / CSBF program. By the way, it has incredible rates, terms, structures, and a limited personal guarantee. What more could you ask for.

So, in summary, is it possible to go it alone in Canadian business franchising financing? It is, but a better solution might be to work with a trusted, credible and experienced Canadian business finance advisor who will craft your package according to financial available and your particular situation and needs. Going it alone, but with a suitable partner when needed is a good thing sometimes!



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 50 Million $$ of financing for Canadian corporations .Info re: Canadian business financing & contact details :

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

Supersize Your Canadian Business Accounts Receivable Finance Success via Confidential Invoice Discounting Factoring

Surprised? Clients often are, when we tell them that they have the ability to ' super size ' their level of working capital and cash flow via a little known business accounts receivable finance strategy known as C I D - confidential invoice discounting or factoring .

What do we mean exactly by the reference to supersizing? Simply that it is highly possible that on utilization of this type of financing you will often double, in some cases triple your access to immediate cash flow and working capital. And in some cases where you would have been self financing or had non financing in place whatsoever, well, your firm has it now.

So what’s C I D - how does it work, what can we compare it to, what does it cost, and why is it so innovative. That’s a lot of questions, so let’s get to some basic answers.

C I D, as we stated is our terminology for confidential invoice discounting, more commonly also called factoring. This type of financing is used by firms of all sizes (even major corporations, by the way) but in reality seems to be more common in the S M E (small and medium enterprise sector). It even accommodates start ups if you can believe it, as any type of financing for a start up is often a major challenge for the business owner.

As a Canadian business owner in the business to business market you typically have a large investment in accounts receivable. But how do you finance that investment when traditional capital is not available, or the reality is that you dont qualify?

That's exactly where business accounts receivable invoicing and discounting comes in. Your ability to sell those invoices as you generate them, using the A/R as collateral allows your company to turn into an instant cash flow machine.

So that’s the essence of factoring, or invoice discounting, but where does our key benefit of confidentiality come in. Right about here! Because the key difference of C I D and business factoring is that you are in control of your sales ledger and customer base, not the factor firm. That’s where you immediately gain superiority over other firms who use this type of financing but are forced by their factoring agreement to make their customers aware of how they are financing their firm.

On a daily basis C I D work in the same manner as what we will call ' traditional ‘ accounts receivable finance and invoice discounting. It’s a simple process. You generate invoices for the products and services that your firm provides and you receive immediate same day funds for 90% of the invoice value. The remaining 10% is held back until you client pays, you then receive the 10% less a finance fee of anywhere from 1-2.5% per month.

Clearly the advantages of this type of business financing couldn’t be more pronounced - its quick financing, its easy to administer ( you bill and collect your own a/r) and you use that valuable working capital and cash flow you have just achieved to run your business on an operating basis .

So, does Confidential Invoice Discounting seem like the proper accounts receivable finance strategy for your firm? Ultimately you will decide that - we're simply letting you in on the secret and letting you be the decision maker around super sizing that cash flow. Speak to a trusted, credible and experienced Canadian business financing advisor on how this type of business financing can put you ahead of the pack!



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 50 Million $$ of financing for Canadian corporations .Info re: Canadian business financing & contact details :

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

Why Canadian Merchant Cash Advance And Business Credit Card Loan Facilities Are Popular forms OF Small Business Finance

There certainly aren’t countless options for small business, retailers, restaurants, etc for achieving working capital and business financing success in Canada
So let's discuss the new and up and coming kid on the block, who goes by a variety of creative names - including but not limited to : merchant cash advance , small business loan, and credit card advance sales loan.
What are these facilities, how do they work, and are they perhaps tailor made for your short and intermediate term cash flow and working capital needs.
The merchant cash advance became popular clearly as a result of businesses such as yours, probably retail in nature who have seen traditional sources of financing either disappear, and quite frankly perhaps weren’t even there in the first place!
While this form of financing is more expensive than traditional financing, as alternative financing goes, it does the trick, providing you with working capital and cash flow based on future sales.
And we can assure you that we spend a lot of time with clients carefully explaining that it’s not a loan per se that brings onerous debt on to your balance sheet. You are simply receiving an ' advance ' against future sales. Other commercial business makes sales, and then immediately finance their receivables to generate cash flow. In the case of your business, either a retail establishment or a restaurant ( basically any business that takes credit cards on a regular basis ) your are simple cash flowing those future sales, getting funds today, and repaying the advance via a percentage of future sales that you feel confident will be made .
Using a simple example, if you are advance , again just as a example here, $ 10,000.00 for your working capital needs a per cent age , typically 10 -30 per cent of future sales is used as a repayment of that advance your firm has just been provided with . Where this works best is if you have a solid credit card sales revenue model, and your have solid gross margins on your services, products, etc.
So is it a good idea for you firm? Well, certainly as we said, it’s a newer form of alternative financing. In most cases we see when discussing the options it is clear to all parties that traditional bank financing options have been fully exhausted. As we said, thousands of firms sell and finance their receivables - all you are doing is selling and financing a portion of your future sales - so for many it does make sense.

And by the way, it’s clearly a form of financing that is unsecured, because the collateral is in fact future sales that hopefully will materialize, but might not!

A good rule of thumb we use is that it’s an excellent short and intermediate finance strategy. Over the longer term you should be working on a long term strategy to probably finance your business.
A merchant cash advance business credit card loan is also very easy to achieve. The main focus is your ability to demonstrate your sales revenue via bank or credit card processing statements. Small business owners can expect of course to be a guarantor on this type of unsecured loan financing.
So, that’s the offering. If you are scrambling on a daily basis in a retail or restaurant type business environment speak to a trusted, credible an experienced Canadian business financing advisor about merchant cash flow advance financing.


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 50 Million $$ of financing for Canadian corporations .Info re: Canadian business financing & contact details :

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

How Charlie Sheen and I Discovered How Financing a Franchise Works – A Canadian Franchise Lending Loan Business Story !

This is a strange one. I had a dream last night that I was on a business trip searching for the answer to financing a franchise in Canada. To many people franchise lending and getting a franchise loan for their new business is a challenge.
I wanted to reduce the risk and increase the chances of success for Canadian franchisees.

When I returned from the trip who did I find at our offices but Charlie Sheen, a very famous personality these days. I was surprised but I simply figured that he too wanted to know the secrets and inside tips on franchise financing in Canada. So not too surprising that he had such a strong interest in this area.

Charlie wanted to know about my trip - he seemed excited about being able to know the methods in which franchises were financed in Canada - he seemed totally interested in everything I was about to share .

I told Charlie that I had stumbled upon the exact method under which most franchises were financing in Canada, and moreso, I knew exactly how to complete transactions successfully. He was all ears.

In order to access the capital you need for financing a franchise in Canada wouldn't it be safe to say that you needed to understand who is offering this financing. I told Charlie that although there are a very small handful of specialized firms in franchise finance that the actual majority of franchise lending in Canada is done under a specific program called the CSBF program. It is underwritten and sponsored by Industry Canada, and the government mandates that Canadian banks ' administer ' the program. Charlie’s eyes were locked on mine. He couldn’t believe government on a daily basis was financing franchises.

Charlies asked if it was possible to ensure that the whole process of obtaining a business franchise loan wasn’t time consuming and frustrating. I assured him that if the prospective franchisee was properly prepared it was a smooth process.

Charlie wanted to know more. ‘So this actually works?' he asked. I assured him it did. To keep it simple for Charlie I explained that a good way of sizing up your ability to get approved is thinking like the lender. In small business financing, because that’s what a franchise is, the focus is on what some call the 4 C’s.

Charlie moved closer. What are the 4 C's he asked? I explained that they were character, capital, capacity and credit. Simply speaking if you have a good business reputation and experience, some funds of your own, and reasonable personal credit history then the ' capacity ' to repay the loan becomes significantly enhanced - bottom line - you will be approved!

Charlie had a question - ' Are you saying that if I am properly prepared I can be successful in financing a franchise?" Exactly, I replied. Ensure that your experienced and credible Canadian business financing advisor works with you to achieve a package that includes a solid business plan, an overview of your experience, a documented cash flow repayment, as well as your ability to put a reasonable personal investment into your new business.

Charlie wanted to know how we could share this knowledge - he suggested a Cross Canada tour we would call ' The Torpedo of Franchise Financing Truth ‘. Not necessary I said , lets just advise Canadian franchisees to seek the services of a trusted, credible an experienced Canadian business financing advisor who will assist them to get the franchise loan and financing they need to begin their new role as entrepreneur/ business owner.

I’ll always wonder if Charlie had the same dream?

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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 50 Million $$ of financing for Canadian corporations .Info re: Canadian business financing & contact details :

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