Financing A Franchise In Canada ? Here Are Clear Finance Options For Approval From Lenders

Pretty well everyone agrees these days that the franchise option is one of the best ways to purchase and run a business. That's the easy thing we can all agree on... but what about financing a franchise and making sure you have a solid knowledge and assistance around finance options and who the lenders are in the Canadian marketplace.

Don't despair. Let's cover off some key basics, tips, strategies, and solutions around your decision to buy a franchise in Canada and become an entrepreneur in the true sense of the word.

After all the euphoria is over re: having made that decision to purchase a franchise a minor problem usually occurs - the cost, and how to finance that cost ?!

It's safe to say you need to pick an ' affordable ' franchise. That’s not as negative sounding as you think, since a large portion of your franchise cost can be financed depending on which financing option you choose. However, lets be clear, there are only two components to any business purchase, debt (what you borrow) and equity (what you put in).

A good rule of thumb these days is a 30 -40% owner equity contribution. That ratio isn’t one that is cast in stone, but is one that we see works constantly for many of our clients.

Remember also that as large as that financing challenge might be that you actually simply have to show that the funds you borrow can be repaid through your cash flow and profit projection. Actually cash flows pay back lenders, not profits. More about that shortly.

In a franchise purchase there are what we call ' soft costs ' and ‘hard costs’. The soft cost traditionally is things like the franchise fee - usually the largest soft cost on your project. Naturally it makes sense the hard costs are things like equipment, leaseholds, even perhaps real estate in some cases.

Financing soft costs is a challenge for any business in Canada. So typically the franchisee should cover them thru his portion of the equity injection. But what about those leaseholds and equipment?

Here's the great news. Financing a franchise in Canada is mostly done through a unique and specialized government loan program called the BIL / CSBF program, monitored by Industry Canada, and administered by Canadian banks under the auspices and watch of the federal program.

Is the BIL a great program? We let our clients be the ultimate judge, but in our humble opinion it provides, bar none, the best finance options for a huge amount of the Canadian franchise industry. The bottom line on the program? Simple. Great rates, terms and flexible structure, and are you ready, a limited personal guarantee. Even the big boys in business in Canada cannot often escape that one!

When clients ask us for some basic key tips and advice on dealing with a franchise lender, or even isolating who these lenders are we always revert back to BOY SCOUT MOTTO 101 - BE PREPARED! Being prepared is simple, but requires a razor sharp focus on having a crisp business plan in place, some financial projections that guess what, make sense! It should be a document that covers your experience, highlights your purchase, and most importantly, shows how you will succeed financially - i.e. pay back the lenders based on the financing options you have chosen. Simple as that.

Are the BIL finance options the only method to finance a franchise? Definitely not, there are some independent finance options out there, and in many cases we supplement the overall financing plan with equipment loans and working capital financing, which also has to be addressed early on in your planning.

If you are committed to purchasing a franchise you need clear guidance and assistance on financing a franchise successfully. You don’t get a lot of chances to do things right in the world of finance, borrowing, etc. Speak to a trusted, credible and experienced Canadian business financing advisor to ensure you maximize those finance options to your benefit.

P.S. Good luck in your new role as a Canadian entrepreneur.






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 50 Million $$ of financing for Canadian corporations .Info re: Canadian business financing & contact details :

http://www.parkavenuefinancial.com/financing_a_franchise_finance_options_lenders.html

Financing A Franchise In Canada ? Here Are Clear Finance Options For Approval From Lenders

Pretty well everyone agrees these days that the franchise option is one of the best ways to purchase and run a business. That's the easy thing we can all agree on... but what about financing a franchise and making sure you have a solid knowledge and assistance around finance options and who the lenders are in the Canadian marketplace.

Don't despair. Let's cover off some key basics, tips, strategies, and solutions around your decision to buy a franchise in Canada and become an entrepreneur in the true sense of the word.

After all the euphoria is over re: having made that decision to purchase a franchise a minor problem usually occurs - the cost, and how to finance that cost ?!

It's safe to say you need to pick an ' affordable ' franchise. That’s not as negative sounding as you think, since a large portion of your franchise cost can be financed depending on which financing option you choose. However, lets be clear, there are only two components to any business purchase, debt (what you borrow) and equity (what you put in).

A good rule of thumb these days is a 30 -40% owner equity contribution. That ratio isn’t one that is cast in stone, but is one that we see works constantly for many of our clients.

Remember also that as large as that financing challenge might be that you actually simply have to show that the funds you borrow can be repaid through your cash flow and profit projection. Actually cash flows pay back lenders, not profits. More about that shortly.

In a franchise purchase there are what we call ' soft costs ' and ‘hard costs’. The soft cost traditionally is things like the franchise fee - usually the largest soft cost on your project. Naturally it makes sense the hard costs are things like equipment, leaseholds, even perhaps real estate in some cases.

Financing soft costs is a challenge for any business in Canada. So typically the franchisee should cover them thru his portion of the equity injection. But what about those leaseholds and equipment?

Here's the great news. Financing a franchise in Canada is mostly done through a unique and specialized government loan program called the BIL / CSBF program, monitored by Industry Canada, and administered by Canadian banks under the auspices and watch of the federal program.

Is the BIL a great program? We let our clients be the ultimate judge, but in our humble opinion it provides, bar none, the best finance options for a huge amount of the Canadian franchise industry. The bottom line on the program? Simple. Great rates, terms and flexible structure, and are you ready, a limited personal guarantee. Even the big boys in business in Canada cannot often escape that one!

When clients ask us for some basic key tips and advice on dealing with a franchise lender, or even isolating who these lenders are we always revert back to BOY SCOUT MOTTO 101 - BE PREPARED! Being prepared is simple, but requires a razor sharp focus on having a crisp business plan in place, some financial projections that guess what, make sense! It should be a document that covers your experience, highlights your purchase, and most importantly, shows how you will succeed financially - i.e. pay back the lenders based on the financing options you have chosen. Simple as that.

Are the BIL finance options the only method to finance a franchise? Definitely not, there are some independent finance options out there, and in many cases we supplement the overall financing plan with equipment loans and working capital financing, which also has to be addressed early on in your planning.

If you are committed to purchasing a franchise you need clear guidance and assistance on financing a franchise successfully. You don’t get a lot of chances to do things right in the world of finance, borrowing, etc. Speak to a trusted, credible and experienced Canadian business financing advisor to ensure you maximize those finance options to your benefit.

P.S. Good luck in your new role as a Canadian entrepreneur.

Without an ABL Lending And Loan Facility Financing Where Will You Be Tomorrow ? A Canadian Non - Bank Alternative !

Concerned about your ability to achieve business operating financing over the long term - if that’s the case an ABL lending solution might be the alternative to a traditional bank financing facility.

We think the whole issue revolves around the term alternative - and we mean that in two ways. First of all from a pure technical reason ABL ( Asset Based Lending ) is in fact ' alternative financing ' , a term that has become very much in vogue since 2008 -2009 when the Canadian business financing landscape changed dramatically due to the global financial recession.
And secondly, it’s just basically another word for choice and we guarantee you that you need choices in your business financing decisions.
So, can you ignore asset financing and let other firms, including your competitors use ABL as their new choice of operating financing? Of course you can, but if this type of loan or facility (it’s not a loan per se) has the ability to virtually guarantee you access to financing for all future growth we think it’s remiss of you not to consider it. That’s just our humble opinion.

The bottom line is that this type of asset based line of credit financing facility is almost always tailored to your specific needs. It provides you with the flexibility to have a customized arrangement around the borrowing power you can generate via... guess what, Assets!

And what are those assets? Commonly they are receivables, inventories, and in some cases as an add on, fixed assets or real estate. It’s simply the monetization of those assets based on realistic values (often achieved by an appraisal)that gives you al alternative , and by the way, almost always larger ! operating facility .

If as a Canadian business owner or financial manager you're concerned about the future of financing for your firm and you have special needs or situations then ABL is probably the answer to your alternative, which is losing out on growth opportunities or having to look elsewhere for debt or outside equity.

We mention debt because you do have alternatives to ABL lending such as cash flow term loans, sub debt, etc but surely the ability to monetize assets to the maximum and not borrow relative to the balance sheet is appealing?

We've referenced the ability of your firm to secure the future of your financing and growth via an ABL lending and financing facility. Clients who want to make this drastic change to non bank financing always ask a question that could generally be summarized as ' whats in it for us '. The answer is pretty simple, increase cash flow for firms that have assets, both current and fixed, that aren’t being monetized now. Although you might end up reporting more on the monthly values of those assets most clients are happy to know that these reports are no longer tied to covenants and ratios, etc as required by traditional Canadian chartered bank financing. Issues of seasonality in your working capital, or being flexible to take advantage of new opportunities (including acquisitions by the way) make ABL lending a solid ' loan ' financing facility alternative choice.

So whats the bottom line in the future of your operating financing? And where will you be tomorrow in your business financing ? Its simply that you should investigate asset based lending facilities, non bank in nature, as a method of creating long term access to working capital and growth ability . Speak to a trusted, credible, and experienced Canadian business financing advisor for the lowdown on ABL financing.






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 50 Million $$ of financing for Canadian corporations .Info re: Canadian business financing & contact details :

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

Confused About Canadian Working Capital Finance ? Cash Flow Financing Techniques That Work

Clear answers... no, even better, clear real world solutions. That’s what Canadian business is looking for in working capital finance. And that type of financing and cash flow solutions has been tough to come by over the last several years.

Let’s examine why your understanding of working capital and your ability to measure the need and the solution is as critical as ever in the competitive environment you fight every day.

Let's focus on some of the hard facts first. If you don’t have working capital key issues such as payrolls, loan and lease payments, inventory purchases, etc can become big issues pretty quickly!

So how can you change assets and sales into the financing of cash flow? It's a one word answer - monetization! You need to use a razor sharp focus on monetizing (i.e. changing!) receivables, inventory, and sales into working capital to address those key issues we just mentioned above.

The better you do this you will find the better the patients health will be and that patient is of course your company.
Canadian business owners and financial managers know that their balance sheet and income statement are related. Today we're focusing mostly on the balance sheet - The amount and relationships between those current assets such as A/R, inventory, and payables can let you zero in real quickly on what some of the problems might be. (We won't forget telling you about those solutions also!).

Yes, you do need positive working capital to ' stay healthy ' from a working capital and cash flow perspective. And talk about a balance act, if you are growing too quickly your investment in A/R and inventory hinders cash flow, and if sales are shrinking then your receivables shrinks also.

So, we've done the usual pretty good job (we think) of telling you what your problems are. But that’s not why you came here, right? Let’s address solutions.

Are there in fact real solutions that allow you to fix today’s financing of cash flow challenges, and at the same time address these issues in a long term manner . Here's the good news. There are.

We tend to review 6 major methods of addressing your working capital challenges. They are asset based lending facilities, their junior sister, working capital facilities, as well as solely receivable financing. And coming up the rear are inventory and purchase order financing, cash flow term loans, and for smaller businesses merchant advance loans on future sales. And, guess what? Almost all of these solutions are non bank independent finance company solutions! We bet you did not know that?

All of these solutions have different levels of criteria for approval and success. Some are size based, and some are viewed as alternative, but boy do they work! Pricing is a factor also, and each of those solutions brings a different level of financing cost to the table.

If you want to investigate any of our 6 proposed solutions to both immediately and from a long term perspective fix your financing and cash flow issues seek a trusted, credible and experienced business financing advisor. Those solutions are just around the corner.



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 50 Million $$ of financing for Canadian corporations .Info re: Canadian business financing & contact details :

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

How To Get The Best Finance Deal When You Lease Equipment from Commercial Leasing Companies

Isn't it true that everyone knows ' a guy ‘. in business .. Today we'd like to be ' your guy ‘when it comes to best deal / best pricing when you lease equipment via commercial financing leasing companies. Let’s get some major benefits around equipment financing, pricing, and structures.

As a Canadian business owner and financial manager you just might be overlooking one of the best forms on long term ' asset finance ' capital in Canada. And getting a solid deal on rates, terms, structure and prompt approval is why commercial leasing companies are often massively under utilized when it comes to providing your company with an alternate form of financing.

As we said, we promised to be ' your guy ‘... so here it goes. You can immediately go to the head of the class by showing that you are aware of a major choice you need to make when you start the lease vs. buy equipment decision. There are two types of leases, capital and operating. Think of them as basically owning or using, in that respective order.

Have you been read your rights? No, we're not arresting you... just letting you knows that as ' your guy ‘you have all sorts of rights when you entire into an operating lease. Payments are cancelable at end of term and you have no ownership or acquisition rights. However, the good news is that if you choose to, you have the rights to purchase the equipment; upgrade it and re finance, or return or extend the transaction. How is that for flexibility -- and you make those choices not the lessor.

Naturally when you opt to own equipment, as many assets to maintain their value (dont think computing in this case!) you now have a non cancelable commitment but payments are fixed and if you're smart you will match the term of the lease to the expected useful life of the equipment .

Don't forget also that we can divide the area of capital leasing into two subsets - a direct acquisition of an asset, or a sale leaseback on assets you already own. Sale leasebacks were somewhat out of vogue during the 2008 -2009 global recession, but they seem to be coming back, and as an alternative many of our clients have benefited from a simple short term bridge loan (i.e. not a lease) on certain unencumbered assets. At the end of the day it’s purely a financial move on your part - generate working capital from assets you already own.

Again, we're ' your guy ' right. So we have an obligation to remind you of 6 other key benefits of lease equipment strategies in Canada. Working with commercial leasing companies on these strategies will save you thousands of dollars.

The strategies are: the freeing up of working capital in your operating lines. In business you want to match the right debt with the right assets, and lease finance perfectly handles long term asst financing. The other 5 benefits are 100% financing, no additional outside collateral requirements, tax write off of assets that normally might not be expensed, simplified record keeping and approval processes .

Have we done an ' ok ' job as ' your guy ' in equipment leasing? We hope so. Are there potential disadvantages or other solutions to lease equipment or acquire assets? Yes there are. So speak to a trusted, credible, and experienced Canadian business financing advisor on commercial leasing strategies that will work for you, not against you. That’s business 101!

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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 50 Million $$ of financing for Canadian corporations .Info re: Canadian business financing & contact details :

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

The Unknown Secret In Canadian Accounts Receivable Finance - C I D Business Factoring And Financing in Canada

Want to feel initiated? Privileged? That's kind of what a secret is about, and we're sharing a great one today, a strategy known as C I D accounts receivable finance - it's our version of the best factoring financing in Canadian business today.

Let's back step a bit first though. Why are you considering receivable finance, and even more to the point, why are thousands of other firms, your competitors included! already there in that business decision to finance business receivables ?

Actually there are only two answers to that question... maybe three. First of all it’s because this type of working capital and cash flow financing is relatively easy to work with, and secondly, the more you analyze it, well it seems to make sense. Our third reason - in many cases clients we meet are almost forced to consider this type of business financing because factoring financing becomes their only method of ensuring their business has the working capital and cash flow to success.

In talking to clients we always try and dispel the perception, and trust us it’s just that, that this is the ' poor mans ‘(or woman’s!) solution to business financing. Hardly, some of the largest, most well known names in Canadian business, even public companies by the way, utilize accounts receivable finance. It’s just disguised a bit more cleverly by those finance folks as securitization, etc.

Anyway, back to our key point today, which is simply is there a way to get all the benefits and financial leverage of accounts receivable finance and cash flow generation in a manner that allows you to control your own destiny . 99% of factoring financing in Canada is done in a very... lets call it ' pure ' manner .You sell your invoices, the buyer, i.e the ' factor' notifies your clients that they have purchased the receivable, and you get your cash flow - the same day . In effect you've just turned your company into an automatic ATM machine with yourself having the key to the back of the unit!

But wait... perhaps like hundreds of other businesses that we meet you dont want to let the world know how you are financing your business, including your competitors by the way! Is there a solution for that?

There is. It’s what we've termed ' C I D’; our terminology for confidential invoice discounting or factoring financing. It allows you to bill and collect your own ar, while at the same time getting all the benefits of that same day cash flow everyone else is getting. Unless we're missing something, it’s the ultimate win/win?!

An now you have opening up a window of financing that has created for your company all the benefits of this type of Canadian business financing - without taking on business debt, because C I D accounts receivable financing is simply monetizing or cash flowing your 2nd most liquid current asset - your a/r . And turning that into your first most liquid asset - cash flow!

Intrigued? Interested? Hopefully not confused? Speak to a trusted, credible and experienced Canadian business financing advisor on the benefits of factoring financing in Canada, including C I D!

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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 50 Million $$ of financing for Canadian corporations .Info re: Canadian business financing & contact details :

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

Fuel Your Film, tv, and Animation project with Canadian Film tax credit incentives financing – Film tax Credits Work in Canada

Fuel - The dictionary tells us it's something that ' sustains and encourages ‘. That’s pretty well exactly how we position Canadian film tax credit incentives. These credits, when utilized, or financed properly, are without a doubt providing you with a very significant portion of your total finance plan.

We never hate to ' diss ' the enemy, but we're on the side of Canadian tax credit financing when it comes to the current turmoil we hear about in U.S. states and other markets. If you are a producer or project owner in the genres of film, television, and animation areas of entertainment you can benefit from a substantial refundable tax credit based on the Canadian federal and provincial governments commitment to the revenue creation by this vibrant industry.

We're big fans of Mr. Jay Epstein who writes on Hollywood financing. At a recent breakfast we attended Jay spoke of the reality that it's harder to make a small or medium sized independent than a ' big budget blockbuster ' as he called them. And we agree.

Naturally we're the first to admin that you can be forgiven for grimacing somewhat when you hear the words ' government ' and ' financing ' in the same sentence. We felt the same way too. But when you sit down with the various government entities , such as we have , you get a profound sense that these government corporations, mostly Crown corp's in nature are taking seriously their mandate to administer and refund millions of dollars in film tax credit incentives .

We haven’t counted recently, and it’s almost a guess, but at least one of every 5 projects we see come across our desks involves an animated feature. As we noted, computer animation and special effects features are fully eligible for the same non refundable tax credits.

The amount of funds, non repayable that you can receive on any given Canadian production (or co -production) by the way, is significant. Anywhere from 30- 45% of the total financing you need on a project can be funded solely through the tax credit process.

Clients want choices, and they have them. If you choose to finance your tax credits you can receive funding on completion of your project, or, perceived by clients as even more valuable, you can use tax credit financing to help cash flow and monetize your project.

It always seems a bit of a mystery to clients as to how tax credits are calculated. A specialized film tax credit incentive accountant can help you maximize the credits and financing by point out various nuances about the ' point system ' that is utilized around eligible salaries for Canadian residents and ‘qualified non residents ‘.

Want a quick example - For you non Canadians there are ten Canadian provinces - Ontario, BC and Quebec seem to be most familiar to most of the U.S. folks that call us. But, if you chose to film or produce in Manitoba you get a 5% producer bonus if a resident there receives a producer credit. And on it goes...

If anything we've just proven that the bottom line is that with all the risk and timelines involved in making film, tv and animation features you certainly want to associated yourself with a small core team in the area of canadian film tax credit incentives and the financing thereof . And trust, us, this is one area where accounting isn’t boring - as your tax credit accountant has the ability to maximize your refund based on his or her knowledge of the Canadian program.

Speak to a trusted, credible, and experienced Canadian business financing advisor in the financing of tax credits in Canada. Money for nothing... well almost!

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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 50 Million $$ of financing for Canadian corporations .Info re: Canadian business financing & contact details :

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