Don’t Make Mistakes In Sources Of Business Capital And Financing For A Canadian Business Loan. Debt Or Equity? What’s Best?

Tweet

You're looking for sources of capital for business and financing solutions. A Loan? An equity arrangement? A monetization of assets ? What works best is of course the nagging question that continuously faces Canadian business owners and financial managers.

Many Canadian businesses who contemplate equity type arrangements simply aren’t ready, and it’s also the most expensive form of financing when you consider the ownership dilution that comes with that strategy.

There is usually never an easy or obvious method to get rid of financial challenges. In fact if you're looking at bank financing, which is of course ' debt ' you may well find that the bank feels that more equity from yourself is in fact required in order to obtain that debt. That's a bit ironic sometimes!

Are there any tools available to help the Canadian business owner understand both the cost of debt and equity? There are, of course.

Whenever any Canadian firm looks for financing outside the business there is a cost to the owners. Naturally if you borrow in terms of term debt the additional interest financing costs reduce profits. Selling equity of course reduces no profit, but, and it’s a big one, ownership is proportionately reduced.

We are always preaching to clients that many forms of business financing outside of equity in act do not reduce earnings if in fact you're monetizing assets and have a healthy turnover in key areas such as receivables, inventory and fixed assets relative to overall sales. That’s why we're big proponents of strategies such as A/R financing, supply chain financing, asset based lines of credit, etc.

Earnings and cash flow analysis is a solid way of evaluating debt and equity alternatives. They can also point to the sources of working capital you need for your business.

What then are the key areas you should always focus on when it comes to debt vs. equity analysis? Some solid ones are overall risk with respect to your ability to make payments under any debt scenario.

And whether its debt or equity consider what flexibility you have with respect to any covenants the lender or equity partner might insist on. Always watch your leverage, there is only so much debt your firm can manage and handle.

The irony in either borrowing or looking for some equity is that you're usually in one of two positions, success, or failure! That one never escapes us, as we meet clients who are successful and have a need to finance new growth or expansion, of alternatively, they are currently losing money and have some real deficiencies in their company that need to be fixed.

When you are looking for debt you can be sure the lender will focus on working capital coverage, leverage, and operating efficiencies. Equity lenders will focus on management, growth potential, and why your business is unique.

If you want to properly understand available sources of capital when it comes to business financing, a loan, or an equity arrangement consider speaking to a trusted, credible and experienced Canadian business financing advisor .





7 Park Avenue Financial :
South Sheridan Executive Centre
2910 South Sheridan Way
Suite 301
Oakville, Ontario
L6J 7J8

Direct Line = 416 319 5769

Email = sprokop@7parkavenuefinancial.com

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 100 Million $ of financing for Canadian corporations .

' 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

Receivable Financing Is The Equivalent In Going From Poor To Rich In Business Cash Flow

Tweet

Information on the Best Type of Receivable Financing In Canada

Can working capital factoring solutions be our business version of ' poor ' to ' rich '? It's an interesting analogy if only for the fact that the receivable factor firm solution, properly done creates capital you never had. Let's try and 'connect the dots' in those solutions so the business owner / financial manager sees a clear path to business cash flow freedom. Let's dig in.

There are of course options in working capital finance - they include taking on debt under a working capital term loan or mezzanine unsecured cash flow loan; or the traditional route of Canadian chartered bank financing - theoretically available to all but unfortunately not always to those that need it most.

So why does financing your sales via A/R factor financing a logical step to business capital freedom? For a starter that low cost bank line of credit may not be available to your firm for many different reasons. If for any number of reasons your firm does not qualify for bank credit you're back to square one... our version of business homeless!

Many firms have the most incredible problem imaginable - they are too successful and growing too quickly. That ' rush ' from getting a large new contract or purchase order or seeing sudden surges in sales brings working capital nightmares, as more and more funds are tied up in materials, inventory, and finally accounts receivable

In certain situations your working capital is required for expansion needed for lease/loan payments on new assets, or marketing and headcount growth. Many clients we meet do great business only at certain times of the year - that seasonality causes cash flow needs to rise and fall dramatically at certain times, sometimes unexpected.

One final situation is the whole issue of payment terms and collections. Even large corporations are often typically the ones that pay the slowest, and then there’s... the government!

While certain situations immediately disqualify you for bank financing (negative net worth, fluctuating profits and cash flows, huge jumps in sales revenues) it’s these exact situations which make your firm a solid choice to be financed by a receivable factor.

By the way, in many cases a working capital factoring solution can be a component of a ' total ' asset based lending deal, whereby your A/R, inventory and un-liened equipment are combined into on solid business line of credit. It's typically called an ' ABL ' line by the pros.

Is there one type of receivable factor solution that works best? In our opinion it's non -notification CONFIDENTIAL RECEIVABLE FINANCING , allowing you to bill and collect your own receivables, draw cash against sales when you need it, and only pay for what you are using .

If you want some help in connecting the dots in A/R financing solutions seek out and speak to a trusted, credible and experienced Canadian business financing advisor who can assist you with in that ' homeless' to ' rich' transition in business capital!






7 Park Avenue Financial :
South Sheridan Executive Centre
2910 South Sheridan Way
Suite 301
Oakville, Ontario
L6J 7J8

Direct Line = 416 319 5769

Email = sprokop@7parkavenuefinancial.com

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 100 Million $ of financing for Canadian corporations .

' 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

Don’t Let Your Company Collapse For Lack Of Cash Flow Financing . Canadian AR Finance For Receivables

Tweet

INFORMATION ON ACCOUNTS RECEIVABLE FACTORING FINANCE

AR Finance, i.e. cash flow financing has the ability to save your company when it fact your firm is faced with survival challenges. Let's examine when a receivables strategy works, and what you need to do to facilitate a financing that makes sense. In essence, ' how it works' and ' why '.

Canadian business owners and finance managers that face challenges of raising cash for their firm can utilize an A/R finance strategy, which is in effect the sale and monetization of your receivables to generate working capital. Our comments are focused on your firm being potentially in ' survival ' mode, but of course they apply to daily operations and growth, or even 'hyper growth ' which is a double edge sword.

If you do in fact require an A/R cash flow strategy are you in fact eligible? Let's examine some key requirements around getting a proper facility in place. We say ' proper' because in our opinion there are certain receivables finance structures that certainly aren't optimal for your company.

Getting back to those qualifications! As a general rule only commercial, i.e. ' Business to Business' a/r is eligible for financing . (While there are financing mechanisms for consumer A/R in Canada - securitization / merchant advance etc. ) invoice financing in Canada general pertains to commercial business receivables.

And by the way, your clients can be in Canada, in the U.S. or foreign - cash flow A/R financing has the ability to capture and fund all of these!

Naturally your firm also has to be selling on credit, as a cash sale environment just does not work!

Size more or less counts when in comes to your ability to set up a proper receivables facility. Although very small facilities can be set up a good rule of thumb is that monthly A/R in the 100k+ range is a recommended size. And by the way, there is NO upper limit on the size of your facility in Canada, as facilities exist for tens of millions of dollars if that is in fact required.

The issue of ‘concentration’ of comes up. As a rule of thumb it’s preferable to have your A/R base spread over a number of clients, with no one client becoming a huge part of your overall sales. That issue is certainly able to be resolved if in fact that's the case with your firm, but widespread A/R clients is in fact the preferred business model.

While in almost all cases Canadian business financing vehicles work best with established companies we do point out to clients that a start up firm can in fact set up a proper facility and benefit in the same manner.

While very small invoice transactions can be financed typically larger invoice amounts lend themselves best to this method of finance.

So those are some of the points that define your eligibility for a cash flow financing facility. To originate a facility you must be able to produce aged receivable reports, financial statements, and basic info around your business model.

Our recommended facility is confidential AR FINANCE, which allows you to bill and collect your own receivables. Generally this type of facility has a higher level of due diligence involved, but your firms reaps all the benefits of cash flow financing and remains in full control of all aspects of the day to day routine.

Speak to a trusted, credible and experienced Canadian business financing advisor
who can assist you in setting a proper facility that puts you in full survival, and hopefully growth mode for future sales and profits.





7 Park Avenue Financial :
South Sheridan Executive Centre
2910 South Sheridan Way
Suite 301
Oakville, Ontario
L6J 7J8

Direct Line = 416 319 5769

Email = sprokop@7parkavenuefinancial.com

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 100 Million $ of financing for Canadian corporations .

' 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

Does Your Canadian Company Have A Serious Asset Finance Loan Or Leasing Strategy ? You Need One!

Tweet

An Asset Finance Leasing and Loan Strategy ? Most Canadian business owners and financial managers realize they can either purchase fixed assets out of equity, or finance those same assets on a long term lease.

Business owners need to focus heavily on the use of the asset. Any company that acquires assets has either a long term view of the asset or a short term view. Lease financing is an excellent method of financing long term assets.
From the company perspective a long term lease on the asset - typically 3-5 years, and sometimes longer, is simply a method of purchasing the equipment via a ' loan '. The company simply decides on which asset or assets they wish to acquire, and then negotiates a price with the vendor or manufacturer. Typically the company is either dealing with the vendor/mfr. or the captive finance firm related to that manufacturer.


Business owners are barraged with claims that ' leasing provides 100% financing ' or that it ' conserves capital '. More sophisticated business owners and financial executives know that long term leasing is in fact a solid mechanism for tax avoidance. Some people maintain that if corporate taxes disappeared long term leasing would disappear!


When a firm arranges leasing it of course uses the equipment, and makes fixed payments on that equipment. Business owners focus more often than not on ' using equipment ', not owning equipment. The user can though structure leases allowing them to purchase the equipment at end of term.


If a customer does not wish to acquire assets over a long length of time, and if those assets have a shorter useful economic life than a firm should consider an ' operating lease '. The company has the right to cancel the lease at the end of term, return the asset, etc. In long term asset financing the transaction cannot be cancelled.
If a firm utilized a purchase strategy for long term assets then the funds for those purchases come from equity shareholders. The company uses the asset, and it owns the asset. Many customers have a philosophy of ' pride of ownership ' and have long term histories of acquiring assets under a purchase strategy. If the company is properly funded this is of course an entirely viable option.


We would point out further that if the financial markets were ' perfect ' ( they are not!) the advantages of leasing would diminish. In that case the company would not have to consider legal costs, brokerage costs, and other miscellaneous fees. Leasing matters because there are no perfect markets - advantages gained by the lessee are at the expense of the lessor, and each company has a unique credit and risk profile.


In summary, each company has a unique financial structure and acquisition philosophy around financing and asset acquisition. Owners and managers must consider the optimal financing strategy for long term assets that best suits overall corporate needs.
Speak to a trusted, credible and experienced Canadian business financing advisor on your asset finance and lease strategy .







7 Park Avenue Financial :
South Sheridan Executive Centre
2910 South Sheridan Way
Suite 301
Oakville, Ontario
L6J 7J8

Direct Line = 416 319 5769

Email = sprokop@7parkavenuefinancial.com

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 100 Million $ of financing for Canadian corporations .

' 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

Canadian Commercial Business Bank Financing - What’s Right ( And Wrong ) With Your Banking Strategy

Tweet

INFORMATION ON BUSINESS BANKING SOLUTIONS IN CANADA

Canadian business owners and financial managers assess their commercial business banking and financing needs at different times in their company's life.

As in many other facets of business it's a little difficult to develop a solution and fix a problem if you don't understand the fundamental problem.

The need to grow your business and be profitable usually drives a bank financing need. A growing business consumes, and needs more cash, if only for the fact that you’re building up receivables and inventories.

In Canada business operating lines of credit are offered by our chartered banks. These facilities finance your A/R and inventory via specific margin calculations.

Most Canadian firms that have this type of credit facility submit monthly financials and aged receivables, which in turn create a new borrowing base under which you can draw funds. Companies that are having challenges ( i.e. they are in special loans ) or who are in breach of covenants may in fact be required to submit almost daily cash flow and receivable reports .

Although the basic arithmetic around bank financing and commercial banking is simple in reality there are a lot of other factors that might end up affecting your bank facility.

What are some of these? In the continuum of time certain industries fall in and out of favor. No better example of this is offered up than the auto industry. Other factors that you as a business owner might not like that affect your bank financing are issues such as your profits ( or lack thereof!) , they quality of business and outside collateral, and your banks insistence on personal guarantees.

Bank financing works best under the following condition - your company is expanding, but at a reasonable rate. One of the greatest ironies of Canadian business financing is that a hyper growth business, even if its generating profits, is often viewed as financing challenged by a Chartered bank.

Business banking utilizes a very basic concept that is often misunderstood by the Canadian business owner. That's simply the fact that with a commercial bank line of credit you're drawing on assets of your growing business to pay older items. But wow, when your business ceases to grow, or profit your ability to draw cash flow out of your A/R and inventory business line of credit stops. But you still have operating and fixed term payment obligations and it now becomes difficult to pay suppliers.

Companies that have a solid handle on cash flow needs and their historical working capital inflows and outflows are in the best position to manage their firms and access bank financing.

Time and time again we meet with clients that tell a very similar story - business grew, expansion plans were put in place, fixed and operating costs grew, and .. you guessed it .. sales started flattening or going down. The result - a recipe for financial disaster!

The ability to manage your cash flow, or, alternatively, slow down your business is key. Speak to a trusted, credible and experienced Canadian business financing advisor for commercial bank financing that makes sense from where your firm is now.






7 Park Avenue Financial :
South Sheridan Executive Centre
2910 South Sheridan Way
Suite 301
Oakville, Ontario
L6J 7J8

Direct Line = 416 319 5769

Email = sprokop@7parkavenuefinancial.com

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 100 Million $ of financing for Canadian corporations .

' 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

Do Your Competitors Use A Customer Finance Vendor Program To Beat You At The Sales Game?

Tweet

Thinking about a customer finance vendor program ? We know for sure that many Canadian business owners and financial managers recognize that their competition sometimes wins the sales battle, without even beating you at actual pricing / cost.
How do they do that? If you had the ability to get to the bottom of the matter you just might find that your lost client was offered a financing solution by your competitor for a sale you should have made!


Thousands of firms in Canada increase sales and are able to motivate their clients to purchase by the effective use of a vendor finance program.
Can we think of two reasons why you wouldn’t want to do that directly? We sure can - first of all you probably don’t have access to unlimited cash, and secondly, there are some serious revenue recognition programs when financing is offered by the seller.


So if that’s the case, what’s the solution? There's a great one, and it’s simply to set up an effective customer finance program that allows you to control the sale and program in partnership with a firm that will provide you with the capital and tools to offer such a benefit to clients.
It's important though to understand the benefits, and in some cases the limitations of the program. Simply speaking, you need to know how and why to offer a financial solution for your client. To coin a phrase we came across over 30 years ago from a trusted mentor, you want to be in a position to ' Remove the Obstacle to Innovation ' when a client considers your product and service combo.


In many cases you want to be in a position to close the sale more quickly - in effect shortening your sales cycle. The financial solution offered to your customer keeps interest in your offering high, and at the same time allows you to get one step up on a competitor who isn’t in fact able to offer the financing.


When you partner with the right firm or individual to offer such a program its essentially at no cost to yourself, other than your time commitment in promoting and putting together the program.


And by the way, you or your sales for don't have to be ' financial pros’ - your partner firm or individual is fully prepared to step in an consult with your customer on the basic elements of such an offering; they of course are things such as term of lease required, monthly payment, possible ownership at end of term, credit approval, etc.


By investing some time in such a program you can have different... let us call them ' flavors' within your offering. They might include shorter term rentals, the proverbial ' don't pay a cent event ', below market interest rates that could be subsidized by your firm in order to increase sales, or allowing customers to pick and choose their own monthly payments by providing them with a rate chart - with of course your firms name at the top . In effect your customer finance vendor program has allowed you to be a total solution vendor.


Speak to a Canadian business financing advisor to find out how you can beat your competitors through the use of a financial option.







7 Park Avenue Financial :
South Sheridan Executive Centre
2910 South Sheridan Way
Suite 301
Oakville, Ontario
L6J 7J8

Direct Line = 416 319 5769

Email = sprokop@7parkavenuefinancial.com

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 100 Million $ of financing for Canadian corporations .

' 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

Confessions Of An SBL Government Loans Super Fan . The Canada Small Business Loan

Tweet

INFORMATION ON GOVERNMENT SMALL BUSINESS LOANS IN CANADA

SBL government loans . I guess you could call us a fan, even a super fan. The word fan comes from the root word ' fanatic ‘, denoting an ' enthusiastic devotee. So why is the Canada small business loan the recipient of our full support. Let's try and preach to some of the potential unconverted.

More and more businesses in Canada, new, and established, are seeking loans backed by the government. Talk about a great co-signer! And remember that we are talking about a loan, not a grant. We're always being asked about ' grant money’... free money in essence. We're sure it's out there somewhere, we just haven't found it, and we're equally believers in the ' there is no free lunch ' concept!

The SBL loan is a great choice for business when you're in a touch economy; it’s all about choosing the right lender under the program and ensuring you are aware of some basic rules and regulations that allow you to qualify for the program. We feel quite strongly that every Canadian business owner can actually do a great job of pre-qualifying themselves in advance.

Let's recap some of those basic qualifications. They include being a Canadian citizen or being eligible to legally borrow in Canada. That's just common sense. Although you only have to only guarantee 25% of the loan personally that comes with the understanding that you have a reasonable personal credit history. In Canada the credit bureaus work on a ‘scoring ' basis, and for purposes of SBL government loans you should at least have a score of 650.

The questions of rates and structures always comes up in connection with questions from clients. Interest rates are ultra competitive given that you business is either completely new, or has under 5 Million dollars in revenue (That’s the revenue cap under the program). Rates on the SBL small business loans are in the 3% over prime range and a small government fee can usually actually be added into the financing of the loan.

Any business financing application has strong elements of one thing - and that’s common sense questions. You should therefore be prepared to address some very basics, including a resume or bio on yourself, a description of your business, a cash flow repayment plan (that’s critical). Additionally some supporting documents are required, all of which in our opinion are again. very ' common sense ' oriented. They include a copy of your tax return, your incorporation data, a premises lease, etc.

It's a great idea to also have a clear idea of the financing you are requesting. The three categories of assets that can be financed under the program are equipment, leaseholds, and real estate. Unfortunately it’s not a cash loan per se, so there are no working capital or cash flow borrowings under the program. And by the way that’s a popular misconception.

We should also add that you need to inject a minimum of permanent equity, in effect your ' down payment ' of 10% of your total borrowing.

It’s strongly recommended that you investigate the power of the Canada small business SBL loan. You just might find you will become a super fan also! Speak to a trusted, credible and experienced
Canadian business financing advisor for help with this great program.








7 Park Avenue Financial :
South Sheridan Executive Centre
2910 South Sheridan Way
Suite 301
Oakville, Ontario
L6J 7J8

Direct Line = 416 319 5769

Email = sprokop@7parkavenuefinancial.com

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 100 Million $ of financing for Canadian corporations .

' 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