Financing Sources In Canada : Little Known Ways To Use Capital Leasing And The Finance Lease

Looking For Evidence That Equipment Leasing Is For Your Company ?

OVERVIEW – Information on financing sources in Canada . Capital Leasing Via The Finance Lease Is A Solid Solution For Asset Financing Needs

Financing sources in Canada come in different categories. The finance lease is simply one of the best tools to maximize capital leasing. But does every business owner/financial manager know how to maximize this method of asset financing? Let's dig in.

We're told you can't fight a trend, and no method of financing assets has grown as equipment financing has over the last several years. North American figures suggest an overall 10%+ growth.

So whether that’s a ' micro ticket ' LEASE ' for items under 25k, or ' small ticket ' ranging from 25k to 100k there’s clear proof that whether its a 2k photocopier , or a multi million dollar piece of plant machinery or office technology its safe to say the evidence suggest this is one of your best methods to acquire assets .

The issues of ' cash flow ' and ' alternate sources of borrowing ' should be high on the list of key ' evidence ' analyzed by the business borrower.

What in fact are the main types of assets that consistently are financed on a day to day basis by everyone, including your competitors! That ' hit list ' includes:

Rolling Stock

Technology

Construction and Plant Floor Equipment

Medical equipment

Business owners/managers like capital leasing because credit approval on terms they can live with is much quicker than that offered by bank and other ' term lenders'.

While the true ' finance lease ' finances 100% of your asset needs on a ' lease to own ' basis don’t forget also that many firms still take advantage of operating leases. Operating lease characteristics include the ability to use but not own an asset, typically shorter lease terms ( 2-3 years are common amortizations ) , and attractive end of term options such as the ability to upgrade, purchase if desired, or return the asset .

We also add as a short footnote that two other aspects of equipment financing should not be overlooked - they are the sale leaseback of assets you already own, as well as the ability to collateralize owned assets under a short bridge loan.

Capital leasing often satisfies the true objectives of the business owner and offers maximum flexibility as a ' financing tool’

Looking for more ' evidence ' that the finance lease is right for your company? That includes:

Hedging asset life against inflation

The ability to pick terms from 2-7 years

Maximizing cash flow

Capital leasing rarely comes with restrictive borrowing covenants

Working through budget and cost restrictions

If you're looking for ways to use Capital lease financing as a tool to run and grow your business seek out and speak to a trusted, credible and experienced Canadian business Financing Advisor with a track record of success who can provide ' the evidence '!











Stan Prokop - 7 Park Avenue Financial :

http://www.7parkavenuefinancial.com

Business financing for Canadian Firms , specializing in working capital, cash flow, asset based financing , Equipment Leasing , franchise finance and Cdn. Tax Credit Finance . Founded 2004 - Completed in excess of 90 Million $ of financing for Canadian corporations . Info /Contact :

7 PARK AVENUE FINANCIAL = CANADIAN FINANCE LEASE EXPERTISE



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

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

Direct Line = 416 319 5769

Office = 905 829 2653



Email = sprokop@7parkavenuefinancial.com


' Canadian Business Financing With The Intelligent Use Of Experience '













Stan Prokop

Financing Sources In Canada. Eliminate Turbulence When It Comes To Canadian Business Financing

The Secret Science Of Business Finance Sources In Canada


Information on in Canada . Canadian business financing challenges can be eliminated when utilizing the right type of finance at the right time



Financing sources in Canada. Truth or Fiction? That's probably one of the feelings or comments some clients we meet have when it comes to Canadian business financing.

Let's get in behind some of those sources of finance for the commercial borrower and eliminate some of that turbulence.

Primarily we'll focus on what we could term ' intermediate ' sources of capital. These include trade credit from suppliers, banks, equipment lessors, A/R financiers, and inventory finance solution providers.

Occasionally the business owner /manger forgets to consider that supplier/vendor financing is one of the best and cheapest forms of capital and cash flow. Quite frankly it is much easier to obtain, is rarely, if ever ' secured' or ' collateralized ‘and typically carries no interest penalty

Don't forget though that while delaying payment to suppliers is a ' cash flow positive ' you never want to have that strategy deteriorate the relationship you have with a key vendor. Furthermore if your firm has the cash the cost of not taking a payment discount also must be measured.

Just a quick example on the whole issues of prompt payment. You can check with your accountant but let’s say you bought 10k of product from a supplier and were able to successfully negotiate a 2% NET 60 payment term.

If you calculate your discount foregone and the proceeds from the use of the money you might find that’s an 18% savings rate -so if you can borrow for less than that you clearly are ahead of the game. Bottom line - don't underestimate the power of supplier financing from a payment and cash flow perspective.

Banks are of course the business owner/manger ' go to ' when it comes to financing sources under consideration. However unsecured loans for business, while available, will rarely give you company all the funding you require. Business lines of credit from banks are low cost and flexible - they simply require appropriate bank collateral and the understanding from yourself that there might be some restrictions on your financials re additional borrowing from others, etc. If your company meets cash flow and ratio requirements from banks they are an excellent source of intermediate term capital for loans on equipment, fixed assets, etc.

A/R financing is becoming increasingly popular in Canadian business financing. Why? Simply because it can provide significant capital without additional equity and allows you to avoid long term debt. It has a higher cost, and we also spend a lot of time in speaking to clients around the fact that the old stigma of A/R factoring disappears more and more every day. The old alternative is fast becoming the new traditional.

Other benefits of A/R finance include immediate cash flow and the ability to handle seasonal bulges in your business.

Inventory financing is typically done in combination with a bank line of credit or non bank asset based line of credit. Good inventory financing is available if your firm has quality products; good inventory turns, and is not of a perishable type - i.e. food.

Equipment financing is a solid use of intermediate financing. It allows you to avoid large cash outlays, replenish assets and technology, is easier to obtain from a financing approval point of view, and allows you to simply pay for assets over their useful economic life.

Our bottom line? You can eliminate the turbulence that comes with business finance challenges by understanding what sources are available for what maturity and need. Simple as that. Seek out and speak to a trusted, credible and experienced Canadian business financing advisor who can assist you with your needs for financing sources 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 10 years - has completed in excess of 80 Million $$ of financing for Canadian corporations . Core competancies include receivables financing, asset based lending, working capital, equipment finance, franchise finance and tax credit financing.
Info re: Canadian business financing & contact details :

7 Park Avenue Financial = Canadian Financing Sources




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














Stan Prokop

Financing Sources For Alternative Finance Needs In Canada . Why Asset Based Lending Works

New Sources Of Finance for Challenged and Growth Businesses

Information on financing sources for alternative asset finance in Canada . When traditional doesn’t work!

New financing sources in Canada can be a challenge for firms that are in one of three categories when it comes to alternative finance. They might be a start up, or perhaps they are in hyper growth mode (traditionally banks and certain other institutions don't like hyper growth!), or, finally, the company might be recovering from major challenges. They are in fact in turnaround mode and the faster the better.

Even firms that might be coming off a bad year, with solutions in place do in fact find that new sources of finance are difficult to achieve.

Why is that? Well, forgive us for sounding like father time here, but the word ' credit ' as in ' business credit ' comes for the Latin word ' credo ' which is to ' trust and believe '. And, surprise, surprise, your vendors, or your current bank, or worse yet, your valued suppliers can probably be forgiven for mistrusting a bit after your firm has gone through a challenging period.

So the goal of the Canadian business owner and financial manager is, of course, to reinstate that relationship to its former glory!

That's where asset finance comes in, because your business asset, ie receivables, inventory, equipment, and perhaps real estate allow you to focus on mending that reputation, or loss thereof , you have with our three aforementioned parties .

If it was a perfect world, (apparently its not) the best route would be standard ' traditional' financing as we know it in the Canadian marketplace. That typically comes from a bank, is has great flexibility, rates are low (they are lower than ever these days!) and are easily achieve, if (here it comes ...!) you have solid business creditworthiness. That of course means profits, clean balance sheets, and cash flow and debt ratios that make sense... to the bank.

That is why asset based loans and financing, whether they be bridge loans or straight asset monetization of working capital accounts.

Asset based lending in North America goes back to the early 1900’s. In Canada it has gained significant traction in recent years, simply because specialized non bank asset lenders are comfortable with your business collateral .Although rates are typically ( not always, but typically ! ) higher than the Canadian chartered banks they provide great liquidity for receivables, inventory, fixed assets, and even a real estate component can be thrown into the mix .

If you are not the ' investment grade ‘ credit that is sought by banks and insurance companies then investigate asset based lending financing sources in Canada . Typical advances of A/R and inventory are 90% and 5-80% respectively.

Speak to a trusted, credible, and experienced Canadian business financing advisor for alternative asset finance solutions in Canada.

7 PARK AVENUE FINANCIAL
CANADIAN ALTERNATIVE ASSET BASED FINANCE EXPERTISE


Stan Prokop - founder of 7 Park Avenue Financial –

http://www.7parkavenuefinancial.com

Originating business financing for Canadian companies , specializing in working capital, cash flow, asset based financing . In business 7 years - has completed in excess of 80 Million $$ of financing for Canadian corporations . Core competancies include receivables financing, asset based lending, working capital, equipment finance, franchise finance and tax credit financing.
Info re: Canadian business financing & contact details :

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