Business Finance In Canada & Financing Alternatives

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Alternative Lending : Use As Directed

 

 

What Is The Best  Business Financing Option For Your Business?
Business financing alternatives in Canada - For many business owners and financial managers it , must seem like they spend a tremendous... aka ' too much' time searching for the credit and banking alternatives and the sources of cash they need to run and grow business. Raising business is even more challenging when the search is for financing for startups!

What then are some of those decision points when your business is looking for business funding of any type? Business sources such as Canada's premier business dailies such as the Globe & Mail and Financial Post constantly reveal the challenges of the SME commercial finance sector in financing a business. Let's dig in!

Easy to say, but fundamentally it's all about finding the right types of funding in the amount that you need that carries an acceptable level of risk and cost relative to means of financing utilized. As we said, easier talked about than done.

More often than not it's about taking on the wrong kind, or too much debt and therefore risking business failure. Working with the right type of banks or finance companies is also important; it's all about knowing the lay of the land!

Business Financing Alternatives

There are several ways in which business finances itself.  Business owners should know that interest rates vary based on what type of traditional or alternative lenders are utilized. Sources of cash for your company include :

Vendor / Supplier credit - That is financing a business without a loan!

Lease Finance / Equipment Financing

Bank Financing

Government of Canada Small Business Loan and Grants for startups - ( Working with government programs and crown corporations often can seem frustrating for business people. It is strongly recommended that you use a business finance expert who has a proven track record in business finance

Asset monetization

New equity

Online Lenders

Many business owners often underestimate the power of supplier finance. The terms and credit needs you're able to negotiate contribute significantly to business cash flow. Supplier credit stems from the outflows of cash. The bad news here is that everybody's in the same boat at the end of the day, as everyone, including your clients attempt to stretch payment terms.

Instead of paying with cash for equipment and technology assets businesses can choose to lease those assets on a lease or rental basis.  Terms of anywhere from 2-7 years, sometimes longer, are available to leases assets such as rolling stock, computers, heavy equipment, production machinery, etc. Bottom line... any asset can be financed.

Canadian commercial banks offer significant financing choices when your firm seeks business credit.  The most desirable bank facility is typically the ' revolver' allowing you to draw daily against the cash you need up to a set limit.  The danger of breaking a bank arrangement often leads many businesses into a death spiral.

While in many cases it's desirable to get new equity into your company the challenge here is that it dilutes ownership at the expense of current owners.
Many owners and finance managers who focus on getting new equity don't fully realize that numerous ' Asset Monetization ' strategies exist as an alternative to equity in many cases.

They include-

Receivable financing
Inventory Financing
Tax Credit Financing
Royalty financing
SR&ED Tax credit monetization
Non bank asset based lines of credit
Sale leaseback
Canada Small Business Loan and BDC Funds
Bridge loans

4 or 5 key issues typically should come up in your overall financing decision. They include:

1. Flexibility of the financial offering
2. Risk
3. Cash flow and profit concerns
4. Control exerted by the lender based on the finance offer  - that refers to issues such as loan covenants, financial ratios that must be maintained, and those ever-dreaded ' personal guarantees'.
5.Timing

At certain times in any company’s history it can't always get the financing it needs. Issues such as your overall leverage and your capital structure need to be addressed carefully. Growth, while always desired by almost all firms requires a proper assessment of your financing needs.


Seek out and speak to a trusted, credible and experienced Canadian business financing advisor who can assist you with business credit and banking decisions that make sense today and tomorrow.

 

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

Click Here For 7 PARK AVENUE FINANCIAL website !



7 Park Avenue Financial provides value-added financing consultation for small and medium-sized businesses in the areas of cash flow, working capital, and debt financing.



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

Business Financing Challenges At The Fiscal Cliff ? Navigating Loan Interest Rates And Finance Capital Solutions

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Business Funding .. When You Need It



Information on business financing in Canada . How to assess interest rates on finance capital based on asset and cash flow financing strategies

It's actually pretty easy today for Canadian busines owners and financial managers to feel that business financing is hardly easy anymore. To put it in the context of recent events in the U.S. the business owners in Canada actually often feel they are at the edge of the ' fiscal cliff '.

And boy does that cliff seem steep sometimes as we see competition in our businesses closing in on us every day. But if your new or emerging competitors are raising financing capital and accessing finance solutions and interest rates commensurate with their credit quality... why can't you?

The answer of course is... you can... if you know how, who to talk to, and are focused on a realistic solution that makes sense for your company.

One of the big mistakes that some business owners / managers make when it comes to financing is that they focus on only one solution ( unfortunately they also might be focusing on the wrong one !) when in fact there are a number of capital and finance solutions that are quite complimentary to each other . As an example we often get calls from existing or potential clients looking for ' inventory financing ‘. While this can in fact be achieved (it’s not easy by the way) the reality is that this type of solution is often best achieved in the context of a ' comprehensive ‘ asset based business line of credit by a non bank finance firm.

We're also assuming that your business is past the ' friends and family' stage which has business entrepreneurs accessing capital via family loans and gifts, credit cards, collapsing of savings, personal lines of credit, etc ... While interest rates on those might be great they typically can only get your business so far - so if you're in it for the long haul, or established already its time to move on - to real business financing!


So... getting ' fully funded ' to operate or grow. What can you as the owner /manager do to achieve that? A good start is understanding the difference between debt and equity. While most people understand that equity means new partners and dilution of ownership they often don't understand that their business is not ready for angel investors and VC’s. So debt financing is the option, but we're talking about debt financing... done right!

Having a solid business plan or executive summary is key to financial funding success. At its most basic it covers off a very simple concept - how you will use the funds and how will financing be paid.



Another key take away for your navigation of debt financing? Simply that a lot of financing solutions bring debt to your balance sheet ; when in many circumstances you can simply monetize assets without bring debt to your financials . Those solutions include:


Non bank lines of credit

SaleLeasebacks

Bridge Loans

Receivable Financing/ Factoring

Tax Credit Monetization

Securitization of A/R portfolios.

Unsecured cash flow loans

Etc! Bottom line - a lot of new capital commensurate with interest rates that makes sense for your firm, and no long term debt on the balance sheet. That's a good thing!

Flexibility is key to proper business financing. Many finance solutions come with higher rates, at least for an interim period. But if they are sustainable and can allow you to take the business to the next level then they just might make a lot of sense. And boy is that better than giving up equity or going down the road of searching for ' investors ' when that solution simply isn’t attainable or doesnt make sense.

Seek out and speak to a trusted credible and experienced Canadian business financing advisor on how you can access finance capital for your firm.





Click here for 7 PARK AVENUE FINANCIAL


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

Business Financing In Canada : The Not So Secret Truth On Interest Rates & Loans

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The Easy Way To Understand Business Finance Interest Rates In Canada

OVERVIEW – Information on business financing solutions in Canada and how interest rates are priced for loans by traditional and alternative lenders

Business Financing interest rates in Canada are often both misunderstood by business owners and financial managers. Is there an easy way to understand how finance solutions are priced? It's certainly not always only about ' fixed' or 'variable ' - that's for sure. We think so. Let's dig in.

Fundamentally it's all about your risk profile but don't forget also there are a variety of both traditional and alternative lenders in Canada- all of whom have different lending guidelines and structures.

Companies who qualify for bank financing in Canada (Spoiler alert - not everyone does!) tend to focus on amortized life of loans and the fixed/variable conundrum. The current low rate environment is a boon for those who qualify for bank financing.

Covenants, ratios and documentation required should always be a part of any commercial borrower’s consideration. Whether it's a bank or a commercial finance company we've certainly observed that the majority of borrowers tend to prefer to deal with a lender with a local presence.

Is size everything? Quite frankly when it come to loans or cash flow finance solutions ' size ' does play an important role in both rate and approval . Interest rate pricing will vary based on credit facility/loan size as well as the amount and type of debt you have on your balance sheet.

It's important to understand that different types of financing in Canada support different goals - that might be one of combinations of growth, working capital, expansion, and even acquisition. In many cases firms opt for a complete refinancing of existing facilities.

What then are different types of business financing that support your firm’s goals? Note also they all have different rates and structures. Solutions for your business include:

A/R Financing

Inventory loans

Sale Leasebacks

Equipment financing

SR&ED Tax credit financing

Commercial mortgages

Non bank asset based lines of credit

Bank credit lines / term loans

Royalty financing

Unsecured Cash flow loans

Your company’s track record and financials will play a key role in obtaining any commercial financing Note also that you firm might have a ' Senior lender ' - typically a bank or commercial finance company, as well as utilizing the financing services of other ' niche ' based lenders, some of whom are profiled above in our list .

While some may view alternative finance solutions as ' expensive' remember also that they will always be cheaper than surrendering equity ownership? Alternative financing solutions can help firms who are challenged or on the verge of distress, which obviously is a key factor in higher rates

It's always about the ' risk ' undertaken by our traditional or alternative lender. If you want to better understand the not so secret truth about business finance interest rates seek out and speak to a trusted, credible and experienced Canadian business Financing Advisor with a track record of success
who can assist you with the best loans and finance solutions that match your firm’s needs.



Stan Prokop - founder of 7 Park Avenue Financial –
Originating business financing for Canadian companies , specializing in working capital, cash flow, asset based financing . In business 10 years - Completed in excess of 100 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 & Contact Details :
http://www.7parkavenuefinancial.com


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 '

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

Business Financing Challenges At The Fiscal Cliff ? Navigating Loan Interest Rates And Finance Capital Solutions

Business Funding .. When You Need It

Information on business financing in Canada . How to assess interest rates on finance capital based on asset and cash flow financing strategies .



It's actually pretty easy today for Canadian busines owners and financial managers to feel that business financing is hardly easy anymore. To put it in the context of recent events in the U.S. the business owners in Canada actually often feel they are at the edge of the ' fiscal cliff '.

And boy does that cliff seem steep sometimes as we see competition in our businesses closing in on us every day. But if your new or emerging competitors are raising financing capital and accessing finance solutions and interest rates commensurate with their credit quality... why can't you?

The answer of course is... you can... if you know how, who to talk to, and are focused on a realistic solution that makes sense for your company.

One of the big mistakes that some business owners / managers make when it comes to financing is that they focus on only one solution ( unfortunately they also might be focusing on the wrong one !) when in fact there are a number of capital and finance solutions that are quite complimentary to each other . As an example we often get calls from existing or potential clients looking for ' inventory financing ‘. While this can in fact be achieved (it’s not easy by the way) the reality is that this type of solution is often best achieved in the context of a ' comprehensive ‘ asset based business line of credit by a non bank finance firm.

We're also assuming that your business is past the ' friends and family' stage which has business entrepreneurs accessing capital via family loans and gifts, credit cards, collapsing of savings, personal lines of credit, etc ... While interest rates on those might be great they typically can only get your business so far - so if you're in it for the long haul, or established already its time to move on - to real business financing!


So... getting ' fully funded ' to operate or grow. What can you as the owner /manager do to achieve that? A good start is understanding the difference between debt and equity. While most people understand that equity means new partners and dilution of ownership they often don't understand that their business is not ready for angel investors and VC’s. So debt financing is the option, but we're talking about debt financing... done right!

Having a solid business plan or executive summary is key to financial funding success. At its most basic it covers off a very simple concept - how you will use the funds and how will financing be paid.

Another key take away for your navigation of debt financing? Simply that a lot of financing solutions bring debt to your balance sheet ; when in many circumstances you can simply monetize assets without bring debt to your financials . Those solutions include:

Non bank lines of credit
Sale Leasebacks
Bridge Loans
Receivable Financing/ Factoring
Tax Credit Monetization
Securitization of A/R portfolios.
Unsecured cash flow loans

Etc! Bottom line - a lot of new capital commensurate with interest rates that makes sense for your firm, and no long term debt on the balance sheet. That's a good thing!

Flexibility is key to proper business financing. Many finance solutions come with higher rates, at least for an interim period. But if they are sustainable and can allow you to take the business to the next level then they just might make a lot of sense. And boy is that better than giving up equity or going down the road of searching for ' investors ' when that solution simply isn’t attainable or doesnt make sense.

Seek out and speak to a trusted credible and experienced Canadian business financing advisor on how you can access finance capital for 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 . 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_financing_interest_rates_finance_capital.html