Top Strategic Working Capital Funding and Facility Solutions

Information for Canadian business owners on working capital funding and the type of working capital facility that will meet your firms needs. How to measure and recognize the need for a cash flow solution that meets your firms requirements.

Every Canadian business owner and financial manger wants to know that their firm has financial health

in the short term. Your company's ability to access working capital funding means only one simply thing - you have the ability to pay off your short term liabilities such as accounts payable, taxes, source deductions, etc.

So do you in fact need a better type or working capital facility today, and, if so, what are your options. We can't cure the patient unless we can confirm he is sick... so how in fact do you determine if that working capital need exists. It could not be simpler. Go to your balance sheet, add up cash, receivables and inventory, and if they in total don't cover your accounts payable, guess what... the patient has a problem.

Two points worth mentioning, we fully realize most successful business managers and owners know intuitively that they have a challenge in the area of cash flow. It's simply recognizing that on a day to day basis more and more time is devoted to working capital management - i.e. collections, invoicing, juggling payables, etc.

There are very specific cash flow solutions for your working capital funding requirements. But believe it or not many of them can actually be fixed internally. You ability to negotiate better terms with your suppliers is a critical cash flow factor. More importantly many business owners don't focus on turnover and quality of your current assets such as receivables and inventory.

By effectively measuring and monitoring your turnover in receivables and inventory can significantly improve cash flow. Technically we're talking about reducing day's sales outstanding and calculating inventory turnover. Your goal is to reduce the amount of time it takes for a dollar to flow through your company.

So we have identified the problem, and the measurement issues around that problem, let's focus on solutions.

In a perfect world, and we know its not, your Canadian chartered bank would financing all your receivables and inventory on an ongoing basis, and, when you need it offer up a bulge type facility to take you through a working capital rough patch. That type of working capital facility is generally referred to as a business operating line of credit.

As we said, it's not a perfect world apparently!... And thousands of firms, perhaps yours, don't have access to this type of facility. So the Canadian marketplace offers up a number of solutions, for medium sized and larger firms the alternative is an asset based line of credit that comes without the restrictions of a bank facility ( ratios, covenants, outside collateral, etc) but in fact provide you with more working capital than a bank could. For smaller firms a working capital facility term loan is available via the government related bank in Canada. For smaller and medium sized firm's receivable financing facilities, know as factoring, can turn your receivables into a constant ATM machine, albeit at a higher cost.

So whats our bottom line. Simply the right working capital facility will put life back into the patient, your company! Knowing what facility works best, what your options are, etc is really the only challenge, Speak to a trusted, credible and experienced Canadian business financing advisor to guide you through to the right cash flow solution.

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


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









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

Article Source: http://EzineArticles.com/5364669

Asset Based Credit Line Solutions In Canada: Your Assets Make This Working Capital Facility Work

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The No Longer Not So Super Secret Business Credit Line ! ABL 101

OVERVIEW – Information on the asset based credit line in Canada. If your company needs a true working capital facility this just might be the solution – here’s why and how

Asset based credit line solutions are no longer that ' super secret ' answer to a working capital facility in Canada. It's the kind of solution that will help power your sales and revenue growth. Let's dig in.

It's tough to determine these days whether business owners/financial mgrs are in fact more optimistic about their future success and their ability to beat the competition in their industry. When they are in fact optimistic the reality is that they must always balance that optimism against their ability to finance both operations and growth.

Although financing continues to be one of the most serious considerations for business in Canada the alternatives are certainly not as available and obvious as they once were. That's what the Asset Based credit line in years past was quite either misunderstood or in fact unknown.

Working capital, cash flow, and cash conservation when it comes to capital expenditures top the lists of most owners/mgrs. Small and medium size business naturally has the greatest challenge, as they don't have the bench strength of larger firms. While Canadian chartered banks are certainly paying lip service and trying to, for the most part support small and medium business the reality is that the ability to finance basic growth of inventory, receivables and contracts is a challenge.

So what does the owner do when traditional bank financing can't be finalized? The reality is that more and more Canadian businesses are considering a financing solution that is becoming more developed every year in Canada - that solution is broadly referred to as an asset based line of credit, or a ' working capital facility '. The acronym for the facility is called ' ABL '.

Is there a special requirement for this type of financing - just one? Assets! Asset based lending is simply the provision of the maximum amount of cash flow and working capital that can be loaned against assets. We used the word loan. But this is not a loan or term loan, it is a revolving facility based on inventory and receivables, (and sometimes customer purchase orders) that your firm generates. The facilities only security is of course the A/R, inventory, and unencumbered equip that your company has available to finance.

The reader might be surprised to know that even the Canadian banks now have special divisions entirely devoted to ' ABL ' solutions; however some feel that their continued emphasis on balance sheet ratios, income statement ratios, and covenants and outside collateral is somewhat similar to traditional banking.

Asset based lines of credit, or working capital facilities as we have called them focus on only one thing, the collateral. These facilities are provided by independent commercial finance firms, and pricing varies by transaction facility size, the overall quality of your business risk profile, and, more importantly who you pick as a partner firm in this area.

We therefore strongly recommend that since this is a newer breed of financing that you speak to and work with a trusted and credible business financing advisor in this unique area of Canadian business financing.

So what is really happening in our facility - it is simply leverage the business assets you have on an ongoing basis to their maximum monetized value. That tends to be 90% of receivables under 90 days, as well as inventory advances of 40-80%, and on top of that unencumbered equipt is valued and advanced on if required. (Real estate is also a component, although less widely used.)

Our Nobel prize winner friend (Bob Dylan)

probably wasn’t talking about ABL lending when he wrote ' The Times They Are A Changing ' - as years ago a description of this financing would have come with terms such as ' lending of last resort ' but the new reality is that asset based lending is fundamental to thousands of businesses in Canada, and growing every day. Even large, well recognized public companies utilize the same facility.

Investigate, and consider the advantages, and benefit from the cash flow and working capital that can benefit growth of your Canadian business. Seek out and speak to a trusted, credible and experienced Canadian business financing advisor and check out that not so super secret business credit line solution.




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

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

A Working Capital Facility . Feeling Awkward About Business Cash Flow

Getting Closer To Solving Working Capital Challenges


OVERVIEW – .Information on business cash flow solutions in Canada . How can the business owner/manager address the need for a working capital facility that meets operating and growth needs


Business cash flow in Canada in Canada. We see business owners and managers struggle to sometimes just grasp the term, let alone the solutions that are required to achieve a proper working capital facility that meets their needs. Should there be a need to feel ' awkward ' about cash finances - we don't think so and here is why. Let's dig in!

In any industry there are of course some specialized terms - the tech ones seem a bit overwhelming to us as times! In finance the concept of ' cash flow ' mesmerizes' many owners / managers. And the additional reality is that lenders, bankers, and others will often judge you and your business on your grasp of that concept.

So a lot of people talk ' cash flow ' (us included!). Not everyone has a handle on it. While the ' true' cash flow statement is in fact PAGE 3 of your financial statement ( right behind the balance sheet and income statement ), the term if very well confused by many because they somehow think its the same thing as ' profit' , ' income' , ' revenue', etc. It is not those!

The fundamental way to explain it is one that most businesses in the SME sector can relate to - payroll. Your company has delivered a product or service, you are waiting to get paid, and there is not enough cash in the bank to pay salaries! That's the crux of the business cash flow.

When the Canadian business owner and manager are in fact in control of cash flow they have a strong handle on some of the most important aspects of their business- and when you can ' scorecard' your working capital situation and put solutions in place to accelerate cash inflows ( and decelerate cash outflow!) you are truly mastering your business.

You can feel a lot less awkward about the challenge we’re talking about today by simply understanding your ' cash cycle ' and putting in finance solutions that match it. The cycle is managed and scorecarded simply by spending time in understanding how your purchase products, when you pay for them, what credit terms you offer, and how diligently you enforce those terms.

As you can see, its all about ' timing ‘ Businesses go under in Canada in many situations because business is in fact great - in fact its so great they run out of cash . That pipeline of funds is simply blocked as the investment you have made in inventory, receivables and equipment intensifies.

What are then the solutions to our conundrum? They include:

Bank commercial credit lines
Inventory financing
Receivable Finance
Asset based lending
Monetizing any tax credits
Purchase order/supply chain financing

Make sure you spot the road blocks we have talked about. Address those red flags by one or several of the solutions about. Seek out and speak to a trusted , credible and experienced Canadian business financing advisor who can assist you in feeling less ' awkward' about business cash flow!






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 :


http://www.7parkavenuefinancial.com/working-capital-facility-business-cash-flow.html




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

Top Strategic Working Capital Funding and Facility Solutions

Every Canadian business owner and financial manger wants to know that their firm has financial health in the short term. Your company's ability to access working capital funding means only one simply thing - you have the ability to pay off your short term liabilities such as accounts payable, taxes, source deductions, etc .

So do you in fact need a better type or working capital facility today, and, if so, what are your options. We can't cure the patient unless we can confirm he is sick... so how in fact do you determine if that working capital need exists. It could not be simpler. Go to your balance sheet, add up cash, receivables and inventory, and if they in total don’t cover your accounts payable, guess what... the patient has a problem .

Two points worth mentioning, we fully realize most successful business managers and owners know intuitively that they have a challenge in the area of cash flow. It's simply recognizing that on a day to day basis more and more time is devoted to working capital management - i.e. collections, invoicing, juggling payables, etc.

There are very specific cash flow solutions for your working capital funding requirements. But believe it or not many of them can actually be fixed internally. You ability to negotiate better terms with your suppliers is a critical cash flow factor. More importantly many business owners don’t focus on turnover and quality of your current assets such as receivables and inventory.

By effectively measuring and monitoring your turnover in receivables and inventory can significantly improve cash flow. Technically we're talking about reducing day’s sales outstanding and calculating inventory turnover. Your goal is to reduce the amount of time it takes for a dollar to flow through your company.

So we have identified the problem, and the measurement issues around that problem, let’s focus on solutions.

In a perfect world, and we know its not, your Canadian chartered bank would financing all your receivables and inventory on an ongoing basis, and , when you need it offer up a bulge type facility to take you through a working capital rough patch . That type of working capital facility is generally referred to as a business operating line of credit.

As we said, it’s not a perfect world apparently! ... And thousands of firms, perhaps yours, don’t have access to this type of facility. So the Canadian marketplace offers up a number of solutions, for medium sized and larger firms the alternative is an asset based line of credit that comes without the restrictions of a bank facility ( ratios, covenants, outside collateral, etc) but in fact provide you with more working capital than a bank could . For smaller firms a working capital facility term loan is available via the government related bank in Canada. For smaller and medium sized firm’s receivable financing facilities, know as factoring, can turn your receivables into a constant ATM machine, albeit at a higher cost.

So whats our bottom line. Simply the right working capital facility will put life back into the patient, your company! Knowing what facility works best, what your options are, etc is really the only challenge, Speak to a trusted, credible and experienced Canadian business financing advisor to guide you through to the right cash flow solution.
--

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 6 years - has completed in excess of 45 Million $$ of financing for Canadian corporations .Info re: Canadian business financing & contact details :
http://www.7parkavenuefinancial.com/working_capital_funding_working_capital_facility.html