Business Financing Canada : Step Inside The World Of Business Financing Options

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Information On How To Get A Business Loan in Canada

Business financing opportunities and solutions don't always provide owners & financial mgrs with the capital they are looking for. We're stepping inside the world of company loans and business financing options with the focus on ... getting what you need and want! Let’s dig in.

The most sought after funding solutions for business funding are often traditional Canadian chartered bank solutions. Many 'SME's' ( small and medium enterprise ' firms often require some form of term debt, aka ' loans' to help set up early needs in investment requirements.

But wait! There's a challenge, which should come as no surprise to most entrepreneurs, which is that Canadian banking cannot always fill the bill when it comes to those immediate needs. Help is required! The reason? Bank financing is often best suited for firms that are later in their growth cycle. Companies that have dynamic needs and who are fast growing present more of a risk to the banking sector.


That's, therefore, the ' gap ' we often are talking about with our clients - the ability to find loans and cash flow solutions from a business lender that can fill your growth needs during times where cash flow and profits might be a bit more erratic. In some cases, it's simply the need to seize the ability to take on a large contract or fulfill and order. That's even more pronounced when it comes to firms that are pure start ups, or service and tech type firms that might have services to offer instead of products.


The irony that's not lost on most business folks is that it's the SME sector that in fact drives the economy when it comes to employment and economic growth, so how to finance a business with the right information and resources  becomes an even more critical factor in the Canadian economic landscape

Business Financing Options - Financing A Business In Canada

So, we've discussed the problem. How about the solution? Many forms of innovative funding can be found in numerous alternative financing solutions available to Canadian businesses. These include:


A/R Financing/Factoring/Confidential Receivable Financing

Inventory Loans

Floor Planning Facilities

Working Capital Term Loans

Government Loan For Small Business  -  At 7 Park Avenue Financial we are often asked ' how to get a business loan from the government ' - This is the best option for start ups and small business loans in Canada - This business loan is often called the ' SBL Loan'. This is almost the only financing program that finances leasehold improvements. The ' bdc loan ' is also a quasi-government loan that can provide working capital and cash term loans and equipment financing for your business - This is not a Canadian grant for small business - it is a flexible term loan with competitive interest rates that rival what larger firms are eligible for

Sr&ed Tax Credit Bridge Loans

Equipment Financing/ Sale Leasebacks

Non bank asset based revolving lines of credit



When it comes to small business financing these solutions can be used to grow your business, acquire a business, or change their overall capital structure, often giving you the ability to de-emphasize ' debt ' with more of a focus on cash flow financing. Business loan rates in Canada vary depending on overall credit quality, size of the transaction, type of lender, and industry profile.


If you're ready to step inside the world of Canadian business finance options available to your firm seek out and speak to a trusted, credible and experienced Canadian business financing advisor with a track record of business financing success who can help you ' get what you want '!





7 Park Avenue Financial :
South Sheridan Executive Centre
2910 South Sheridan Way
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

What Are Short & Long Term Financing Options For My Business

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The Best Canadian Financing Options For Your Business

Short and long term financing options are not always comparable to the U.S. borrowing options we read and hear about in the business news. That is a double-edged sword when it comes to financing your company with the right loans, debt and cash flow options that allow the business owner and financial mgr to fund the company.

At 7 Park Avenue Financial new clients tell us they feel strongly that there is a lack of proper business funding options for small and medium enterprise firms in the Canadian business landscape.

For those companies that are clearly a ' barrier to growth', let alone survival in economic turbulence! Primarily we're talking about debt financing as well as ' asset monetization' to grow cash flow and working capital without taking on debt. Solutions such as business credit lines, either via the bank or a non bank lender, are critical to operating any business.

Businesses are funded in different manners, whether they are new and ' out of the gate ', often funded by owner personal investment and the proverbial ' friends and family '. Debt financing for the SME sector in Canada has historically been difficult to achieve.

Many new businesses, franchises included, are funded by the Canadian Govt Small Business Loan progra,m which offers significant capital to new and growing businesses. A combination of generous limits, low rates, and government guarantees and low personal guarantee makes this program very appealing to thousands of businesses every year.

We spoke of the business finance options in the U.S. It is important to note that there is probably a lot wider variety of options and lenders in the United States.

EXAMPLE : Canada set up its own version of the U.S. ‘SBA ' program. In Canada we call it the ' SBL ' - It's a govt guaranteed loan with the federal govt guaranteeing 85 % of your loan to the bank. In Canada, the program only finances equipment, leaseholds and real estate. In the U.S., numerous other options are available under the same program.


A different banking and financial system create the perception that there are more banks and lenders in the U.S., offering a larger variety of funding. But Canadian businesses should realize that a combination of traditional, as well as Alternative Financing solutions, do exist for borrowing needs.

Our Canadian chartered banks are significant ' deposit takers', as a result they are understandably risk averse, leading of course to a stronger banking and financial system ( that's a good thing ), but on the other hand limited business lending options to a certain degree.

The good news is that Alternative Lenders are providing more choices every day to thousands of Canadian firms, due somewhat in part to U.S. business financing models becoming more popular in Canada. Short term working capital loans, asset based lending ( ' ABL ' ), and numerous A/R and Sales financing solutions are now readily available to the Canadian business borrower.


The traditional financiers in Canada are:


Banks

Business Oriented Credit Unions

Insurance companies

Leasing Companies

Mortgage Institutions


Traditional financiers in Canada use the same approach for almost all borrowers, which of course has a tendency to restrict financing. In Canada companies seeking SME COMMERCIAL FINANCE (small to medium sized firms) constantly are challenged to finance sales and assets. Access to business lines of credit is always a challenge; Our previously mentioned Asset based lines of credit in Canada have exploded in popularity.


WHAT FINANCING OPTIONS ARE AVAILABLE TO ENTREPRENEURS & BUSINESS OWNERS?


Offerings Business owners should consider include:


A/R Financing

Non Bank Asset Based lines of credit

Equipment financing

Sale leasebacks

Bridge Loans - asset based

Tax Credit Financing (film and SR&ED)

Franchise Loans

Govt Guaranteed Loans

Working capital term loans

Merchant advances


To borrow with a full understanding of your business finance options seek out and speak to a trusted, credible and experienced Canadian business financing advisor with a track record of business finance success who can assist you with loans, funding and growth finance and survival options specifically suited to your business needs.


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

Small Business Financing In Canada

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Working Capital and Financing Options

Small business financing in Canada ' should ' mean that your company has access to all the working capital you need to both run, and grow, your business .

At 7 Park Avenue Financial we believe that is not impossible, but the business owner and his or her financial manager must have a solid understanding of the options and your company's ability to qualify for and execute on the option or options that make the both sense . Note that in some cases it might make sense to cobble together more than one option to achieve that ' cash flow nirvana' you are looking for .

The business reality is that cash flow doesn't discriminate - both companies in looking for SME COMMERCIAL FINANCE solutions, all the way up to the largest corporations need access to cash flow options. The challenge for smaller firms is that business finance loans are often more limited to the smaller company. So it's therefore important to know what those options are!


Accessing the cash flow challenge might be easier than you think . More often than not smaller firms though have the challenge of locating the expertise and resources they need to evaluate the business finance conundrum.


Two key elements of your first step to what we call 'working capital assessment 'are your gross margins and your turnover. That’s the big problem we have with text book / academic solutions to working capital - they point you to the text book calculation - give you a formula which essentially has you subtracting current liabilities form current assets, and voila ! the inference is you have working capital . However, our clients have never paid a supplier or completed a company payroll with a ratio!

Many firms have an ' inventory component ' to their business - These companies are typically non service type firms , which often are less capital intensive.

To properly assess your working capital needs focus on understanding your turnover - how much inventory do you carry, what are the days outstanding in inventory, and as importantly, or more importantly, are your receivables turning over .

Business experts tell us that for many firms 80% or so of the total of all the business assets you have are tied up in A/R, inventory, and, on the other size of the balance sheet let’s not forget accounts payable .

It is possible to have financial business financing success based on your new found knowledge and analysis of your cash flow and asset turnover.


Canadian business financing solutions to small business finance loans really revolve around a couple viable solutions. Typically, in our experience Canadian chartered banks cant satisfy your business working capital needs - if only for the reason that they rarely finance inventory and require significant merit in your overall financials, profitability, external collateral, personal credit worthiness, etc .

Solutions To Business Finance In Canada

 

There are very viable options that have the potential for a 100% turn around in cash flow :

A total working capital solution can be achieved by a they working capital finance solutions such as a non bank asset based line of credit. This solutions monetizes your accounts receivable and inventory into one borrowing facility .

This is commonly called an asset based line of credit that provides high leverage margining on all you business assets.


Other solutions, still as viable , yet somewhat misunderstood are securitization, and purchase order financing of new contracts and orders. (Your suppliers are paid directly for the orders you have in hand - what could be better than that?)

One of the most active types of ' instant small business financing ' Finally, coming up the road at lightening speed is factoring and invoice discounting. We mention them lastly but they are probably the most popular method, gaining traction everyday. Our favorite is confidential invoice financing, allowing you to control your financing .

Recommended A/R Small Business Financing : 

 Confidential Receivable financing, allowing your company to bill and collect your invoices in a normal fashion , turning current and future sales into instant cash flow.

We have identified several ways to determine the need for proper business financing ; we have outlined a number of solutions that will take the guess work out of working capital.

These loan and financing options are available with a bit of research and/or help from a trusted , credible and experienced Canadian business financing advisor who can provide you with timely and valuable assistance in your cash flow needs .




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

What Is An Asset Based Lending Facility ?

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Commercial Asset Based Lending Works - Here's Why

Commercial asset based lending in Canada is basically a healthy alternative to traditional bank financing solutions that business owners and their financial mgrs are looking for to run and grow their companies . Most business people agree there is nothing better than healthy competition and asset based lending solutions, specifically business line of credit loans are a direct competitor to Canadian chartered bank facilities.


Dramatic changes in Canadian business financing have happened in the last ten years or so relative to the 2008-2009 worldwide recession . A number of ' new ' ways to finance your business make commercial borrowing facilities more accessible than every . Commercial lenders are offering viable solutions to working capital, debt, and cash flow needs sought by the Canadian business borrower.

These independent commercial finance companies, both 100% Canadian as well as some U.S. players doing business in Canada compete directly with traditional finance sources to offer a wide array of financing solutions for your SME COMMERCIAL FINANCE needs. Even internet solutions now empower the Canadian business borrower - those searching for ' abl asset based line of credit ' via an internet search find numerous offerings that can be specifically tailored to their needs.

Also on the rise are short term working capital loans - these loans arose out of the cash flow loans made to predominantly retailers and are now well suited to general business borrowing in pretty well every industry.

No secret that Canadian chartered banks often command the first train of thought when it comes to business finance for a revolving line of credit . Asset based business lending for lines of credit gains more traction everyday.


So let’s provide some clarity around ABL finance in Canada. If there is one differentiator of the product it’s simply that the total focus of the facility revolves around one word, ' assets '. Non bank asset based loans are more flexible than a traditional bank offering, and at a time when more is better they leverage your assets significantly greater than a bank facility. Remember that an ABL loan is typically from an unregulated lender; they have different sources of capital and don’t require key elements that are necessary in the Canadian chartered bank system.

Asset based business credit lines are not to be viewed as 'term loans ; They are simply a ' monetization ' of the assets you have in your business already - specifically receivables, inventory, equipment, and , if applicable, real estate.

While our banks focus on ratios, covenants, outside collateral, personal guarantees, etc the Asset Based Lender focuses predominantly on .. you guessed it .. Assets !


So why the sudden and growing popularity in asset based lending in Canada. We think the answer to that is the fact that it covers every type of industry, retail, manufacturing, service, etc. But more importantly it also addresses your company life cycle. Even more important is these credit facilities tend to grow almost automatically with your sales levels, allowing firms to capitalize on new markets, larger orders, new major customers, etc.


An asset based ABL finance facility can be achieved for a start up, an established growing firm, and yes, those firms that have suffered severe financial challenges. In the ' old days' (yes we remember them) it was not uncommon for forms of asst based lending to be viewed as a ' last resort' type of financing. Fast forward to today and some of the largest corporations in the world, in Canada included; utilize this financing as opposed to a traditional bank facility. So something must be working!

In order to assess your firms suitability for this type of line of credit businesses should be prepared to offer up to date financial statements , and proper agings of receivables, inventory and equipment lists if appropriate . Note - only unencumbered fixed assets may be considered as a part of your credit facility . Many firms of course have liens on some fixed assets they are leasing or are borrowing against .



Speak to a trusted, credible and experienced Canadian business financing advisor with a track record of business finance success to better understand how asset based loans can monetize your firm’s assets into an ABL business credit line facility that provides you with maximum working capital and asset leverage.




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

Government Small Business Loans : Canada

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Qualifications For The Federal Government Loan Program In Canada

Government Small Business Loan approval success depends on the quality of information that you as a business owner have on being successful for this popular government program administered by Industry Canada.

We're going to provide some key explanations and information around the ' SBL ' , the common name for the Govt Small Business Loan. And by the way, the loan amount is not that small for firms in the small and medium enterprise sector who are privately owned.

By the way, the actual name of Industry Canada's program is the ' CSBF ' ; the Canadian Small Business Financing program.

So forget all the acronyms, call it what you want, but if you're a smaller or newer business in Canada you might well want to consider utilizing the program - in recent times the govt has increased the amount that can be borrowed - up to a million dollars in certain situations. That's a large amount, but here at 7 Park Avenue Financial typical loan amounts for the program tend to range in the 350k range on average.

How To Access the Government Guaranteed Loan :

There are a number of key stages in completing a successful funding for your business, not the lease of which is being able to determine if you qualify .

Here are some key basics in the initial determination of qualifying

Actual or business revenues must be less than 5 Million dollars per annum

The owner or owners of the business must have a decent personal credit history - typically this means a credit score in the 650 range - Safe to say that since it is a federal program your personal tax filings should be up to date - Bottom line - no tax arrears

Understand what can be financed under the program - These loans are not cash or working capital loans - The loan is used to finance 2 key asset categories - equipment and leaseholds


So our point... simply call it whatever you want, but consider using the program! And by the way, whats so ' SMALL ' about 1/2 Million dollars. That’s the formal cap on the program, although most financings are done in the 350k range. Again, it’s probably just us, but that’s not small. Everything’s relative we guess.

Let’s examine the stages of getting a completed funding under the program. Stage one is of course determining if you qualify. Some basic guidelines are as follows - your first must have revenues, or projected revenues under 5 million dollars. We say ‘projected ' because thousands of firms financed under the program are in fact start ups who might clearly not be able to achieve this level of financing outside the program.

Owners of the business must have a respectable personal credit history and be up to date in their personal tax filings. Doesn’t it make sense that you might not get a government loan if you have tax arrears? We certainly think so.

Documentation for the Small Business Loan

It might be easy to feel overwhelmed on the documentation required for the loan - that should not necessarily be the case - You should have a business plan or executive summary of the business, one that includes financial projections - Additional back up info would include your personal net worth statement

It might come as a surprise to many business people that no interaction with the government is required under the program . That is because Industry Canada works with your local bank who adjudicates applications for the loan .

At 7 Park Avenue Financial many clients searching for govt guaranteed loans tell us they can't find bankers who are familiar or comfortable with the program

Recommendation :

Speak to a trusted Canadian business financing advisor with a track record of business finance success in the program

Presenting Your SBL Loan Package:

Be prepared to discuss typical questions that might come up under any loan for business - that includes use of proceeds of the loan , your relevant business background and experience, etc.

Its simply a case of presenting your package in person, and answering typical question that might come up on your business, the use of the proceeds, and your own business background and experience . Here again a trusted business advisor can do this for you and with you.

Approval Under Govt Loans:

All invoices you submit under the program are paid by the bank and are paid up to 90% of the face amount of the invoice - Your contribution to the program is the balance of 10%. That ten per cent is your ' equity ' component of the program. The govt, aka Industry Canada guarantees the bank the majority of the loan .

Hundreds of millions of dollars of loans are advanced annually under the program, for pretty well ever industry in Canada . By the way, franchises are a huge component of the program in our experience.


If you are looking to take advantage of the solid rates, terms, and flexibility of the Govt Guaranteed Loan speak to a business financing expert who can help you navigate the program in the lease amount of time - allowing you to start, run, or grow your business.


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

Working Capital Lines of Credit and Loans That Work - Not Just For the Bank!

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Working Capital Financing

When business owners and financial managers have successfully negotiated working capital facilities or term loans it should not be the end of the story. By that we mean that the business person needs to continually focus on what the bank or other financial institution requires, and more importantly, how they view the customer from a control point of view - i.e. are they in control or able to exert control on your business.

The balance sheet must be a top focus for the business owner - once a firm is over leveraged, i.e. borrowing too heavily, the bank generally starts positioning around their overall security or your ability to de-leverage.

Borrowers must be comfortable and knowledgeable about the use of 'triggers '. Triggers are the implied actions the bank or institution will take when things aren't working out. This can include everything from general poor financial performance to very specific pre agreed upon financial ratios. And the business owner must remember that he or she agreed to and concurred with these ratios.

Banks want to see cash flow' flowing ' - flowing to repay their debt - so there many be triggers put in place by the bank to ensure that minimum cash flow standards are kept, and also that owners and shareholders do not withdraw excess funds.

Over time business owners will probably find, in our experience, that the bank restrictions either tighten up or loosen, depending of course on the overall comfort level the bank has with the firm. Clearly firms that seem temporarily challenged in profits and balance sheet quality will receive much more scrutiny.

Business owners can do some very solid and valuable preparatory work in negotiation of bank triggers. If they have a solid long term history of earnings this should be a very strong negotiating point with the institution. Simply by self introspection of the firm can the owner or financial manager focus on what is going to go wrong re sales, pricing, forex, etc. The owner needs to be able to talk to these issues and show how he could address them.

For a start calculate your own key operating ratios, if they are going to be discussion points with your bank or institution you might as well know your numbers now. Using 'what if 'scenarios help immensely and will position yourself as knowledgeable about your business.

Discussions with your bank need not be absolute and immediate on any time of loan negotiation - you can get a great informal sense of what the bank is thinking and work from that point forward. Try and read between the lines as to what is hot, and what a Vis is not with the bank Vis their perception of your firm, industry, etc.

In summary, business owners need to show maximum flexibility on working capital and loan negotiations. Negotiations should be from strength, accentuating the positive. Example - strong forecast sales and profits and potentially offset a weaker balance sheet.

Trade-offs with the bank is also encouraged- and fewer triggers and covenants are better than more! And yes, there is more than one bank in the world, although business owners should be cautioned that shopping around is not optimal at all times, and can in fact backfire, particularly a small business. Business owner beware!






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.




Article Source: https://EzineArticles.com/expert/Stan_Prokop/432698


Article Source: http://EzineArticles.com/3679339




Stan Prokop

Need Equipment Loan and Lease Financing ? Re-program Your Leasing Finance Strategy Today !

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Look at Equipment Financing in a Whole New Light !



Information on equipment loan financing and lease finance strategies . How to re program your leasing strategy to maximize benefits !

Sometimes you just need to re-program things to make them work better - that's what we're also suggesting when you review your lease finance and equipment loan financing strategies for your company.

Let's examine how you can maximize your leasing strategy to attain maximum benefits and minimum hassle! That's clearly a win win strategy.

Focus clearly on eliminating what we can only call the ‘hassles’ of dealing with other types of financing , It's all about ' time' and your ' business bandwidth ' today when you are visiting a new asset acquisition . Without a doubt we can state that leasing equpment is by far the quickest method of obtaining an approval, satisfying both your vendors need as well as your own time constraints.

With only a very basic financial calculator you can quickly review all your lease finance options - the favorite question of almost all clients is: ' What will my monthly payment be?’ It's about time for you to answer that question yourself, and make sure that your cash flow and working capital remain intact on the equipment loan financing you are contemplating. How? Just remember that the only elements to any lease are: term, rate, amount financed, payment, and end of term option. If you know any 4 of those you can always solve for the final item, which in our case is payment. You should assume an interest rate that is consistent with your firms overall credit quality.

Business owners and financial managers should view their lease finance acquisitions in the context of your overall financial strategy. You might need to’ re - program ' your thinking on buying and paying for assets outright . Doesn’t it make more sense to keep your cash and line of credit reserves intact, and match the useful economic life of the asset you are acquiring to a predicable cash outlay?

A quick way to’ re program ' your leasing needs is simply to always use the same business template for each asset you are acquiring . They key aspects of that decision template, if we can call it that are: cash flow budgeting re the monthly lease payment, reviewing the asset in the context of not having to draw on your business operating line of credit, determining how long you will use the equipment for (thereby matching term and payment) and finally, factoring in balance sheet and tax advantages into your asset acquisition decision.

What's the biggest’ re programming' issue with most firms . It’s simply their mild obsession with ' rate ‘. Yes a rate has to be competitive, but view the lease financing rate in the context of the current interest rate environment , the challenge of getting traditional bank financing, and the fact that in the current environment rates are probably going up and not down . The real reality is that you determine your own rates in your new leasing re programming strategy! That’s because the largest factor in determining rates for equipment financing is the manner in which you properly present your overall credit quality and financial health.

In summary, equipment loan financing, aka ' leasing' has been around for over a hundred years in North America. Take a hard look at why you finance your assets, reprogram your strategies around benefits and ' how to ‘, and acquire your assets with the knowledge you have made the best financial decision for your firm. Need help ? Given a choice we’ll take an expert over a rookie any day ! Speak to a trusted, credible and experienced Canadian business financing advisor who will work on your ' re programming strategy with you!








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