Business Financial Solutions In Canada : Untapping Capital

Is Lack Of Financing Hindering Your Ability To Capitalize On Growth Opportunities

OVERVIEW – Information on business financial solutions in Canada . Access to capital helps Canadian firms grow their business if proper financing is accessible

Business financial solutions in Canada (or lack thereof!) are the key in allowing business owners and financial managers to capitalize on growth initiatives. Let's dig in.

The myriad of finance offerings in the SME Commercial Finance sector can be a double edged sword. That's because lack of information , knowledge, of clarity around who is offering these solutions often confuse business people when in fact they are meant to solve growth problems That , coupled with the fact that many industries vary in the types of financial solutions that fit them best makes matters even more confusing .

A good example is a type of finance that's often the most sought by small businesses and even retailers - Inventory financing. This type of capital need is driven by the need to purchase and turn over inventory and is a key part in the ' bridge ' between client order, delivered product, and the generation of receivables, which in turn still have to be collected!

Banks and many commercial lenders shy away from inventory as a financeable asset only because they simply don’t have the expertise to manage and fund such an asset class. However, this has created opportunities for other lenders to focus on this niche, and create an entire market around inventory financing.

The most common method is to make inventories a part of an overall business credit facility. While that can be a Canadian chartered bank if your company is ' credit worthy ' more often than not the proper solution is an asset based line of credit , known as the ' ABL ' which includes inventory as party of your financing margin , together with receivables and equipment .

Bank term loans are low cost and have great term amortizations, but because they are cash flow and covenant based in our banking system they are more difficult to achieve. While the Canadian govt backed loan program, (‘CSBF’) provides thousands of businesses a year with billions in financing it only finances two asset classes - equipment and leaseholds. Popular misconceptions that this loan can provide working capital or inventory financing - the simple answer - It does not.

We spoke of that bridge from the time your firm takes and order to when you get paid from clients. Receivables are a part of that bridge and this asset can typically be financed at 75-90% of total A/R value. Receivables financing is accomplished through a bank facility, or, as common these days, via invoice finance. Our recommended solutions to clients is ' CONFIDENTIAL RECEIVABLES FINANCE ' if only for the reason... you guessed it... is that it’s CONFIDENTIAL.

In Canada equipment lessors and commercial mortgage firms can satisfy the bulk of capital options for equipment and real estate. They are typically long term in nature, 5-20 years respectively.

While personal equity and outside equity capital aren't often the most desirable methods to attract capital the best solution is simply choosing the right debt or asset monetization solution that meets your company and industry needs .

If you want to explore business financial solutions in more detail, with a view towards growth seek out and speak to a trusted, credible and experienced Canadian business Financing Advisor with a track record of success who can assist you in tapping into second stage financing solutions.



Stan Prokop - 7 Park Avenue Financial :
http://www.7parkavenuefinancial.com
Business financing for Canadian Firms , specializing in working capital, cash flow, asset based financing , Equipment Leasing , franchise finance and Cdn. Tax Credit Finance . Founded 2004 - Completed in excess of 90 Million $ of financing for Canadian corporations . Info /Contact :

7 PARK AVENUE FINANCIAL = CANADIAN BUSINESS FINANCE SOLUTIONS EXPERTISE








Have A Question /Comment On Our Blog Or Canadian Business Financing Alternatives ?
CONTACT:
7 Park Avenue Financial
South Sheridan Executive Centre
2910 South Sheridan Way
Suite 301
Oakville, Ontario
L6J 7J8

Direct Line = 416 319 5769

Office = 905 829 2653



Email = sprokop@7parkavenuefinancial.com


' Canadian Business Financing With The Intelligent Use Of Experience '

Stan Prokop

Business Financing Options In Canada : Most Effective And Why

Looking For All Seasons Financing ?

OVERVIEW – Information on business financing options in Canada . Understanding various business loan and asset monetization solutions is key to your company’s financial success







Business financing options in Canada tend to be an ' all seasons' challenge. The Canadian business owner/financial manager constantly seeks different loan options and is constantly challenged to understand who to deal with, where to go, and what makes up qualifications for any specific type of financing . Let's dig in.

In a perfect world

(by the way, its not) commercial businesses in the B2B sector would choose to be 'all cash ' businesses. That won't happen as along with the costs of paying supplies, funding operating expenses and overhead the reality is that some form of debt or asset monetization is required to carry inventory, receivables, purchase equipment , etc.

Through those ongoing ' seasons' of a business year there are of course bulge requirements and seasonality, simply adding more ' excitement' to the mix.

‘Loans’ is of course the generic word that business folks associate with financing. Those fundings come from banks, commercial finance companies, and for many companies in the SME Commercial Finance need sector even the govt, via the CANADIAN GOVERNMENT GUARANTEED LOAN PROGRAM. That loan guarantees banks the majority of their principal on the loan in case of a loss

So back to our ' all seasons' approach to Canadian business financing. Typical loan needs in the business financing area include lines of credit from banks or other commercial finance companies, or equipment loans from those same banks or equipment lessors.

There is currently a healthy competition between banks and other lenders who focus on various ' niches' in business finance. As an example one alternative to the bank line of credit is the ' ABL '. It's a working capital revolving line of credit that is based on the total value of your receivables, inventory and equipment. It costs more, but 99% of the time give you more, and is much easier to access if your firm can't meet bank qualifications.

You not only need to be comfortable is assessing your options; you must ensure you have a basis sense of some key aspects of any specific type of business financing. Typical forms of business financing include:

Receivables financing / factoring / confidential receivable funding

Inventory Finance

Working capital term loans

Equipment Leasing

Tax Credit Monetization (primarily 'SR&ED ')

Asset based non bank credit lines

Purchase Order / Contract Financing

Cash Flow/ Mezzanine Financing


What are those issues that need to be addressed in any of those options for our ' all season ' approach to business loans/asset monetization? They include:

Term/amortization

Interest rates and fees

Collateral availability/quality

Owner equity issues

Personal guarantee emphasis

If you're focused on capitalizing on the best form of financing for your business, during any season! , consider seeking out and speaking to a trusted, credible and experienced Canadian business financing advisor who can assist you with your options assessment.



Stan Prokop - 7 Park Avenue Financial :

http://www.7parkavenuefinancial.com

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

7 PARK AVENUE FINANCIAL = CANADIAN BUSINESS FINANCE EXPERTISE




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

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

Direct Line = 416 319 5769

Office = 905 829 2653



Email = sprokop@7parkavenuefinancial.com


' Canadian Business Financing With The Intelligent Use Of Experience '

Stan Prokop

Government Guaranteed Loans : Is A CSBF Your Potential Business Loan Lifesaver

We're Cutting All The Red Tape In The Gov't Guaranteed Business Loan

OVERVIEW – Information on government guaranteed loans in Canada . The ‘ CSBF ‘ business loan satisfies the capital needs of thousands of business people and entrepreneurs every year

The Government guaranteed business loan in Canada is quite often the financing that entrepreneurs in start ups and ' small business ' require to access capital for financial assistance. In many cases it's the ' lifesaver ' that the business owner is looking for. Welcome to CSBF (Canadian Small Business Financing) loans 101. Let's dig in.

Most business people in Canada, rightly or wrongly, associate anything to do with ' government' as mired in red tape/bureaucracy. That really isn’t the case with the Govt SBL (Small Business Loan) program. It certainly can be though if you're poorly armed with key critical info on the program itself, how to access it, and, most importantly, how to get approved!

By the way, do Not apply if you're a large business - and the program clearly defines that as any business with over 5 Million dollars in revenue. The actual size of the loan portfolio by the way is in fact ' large ', with billions being financed every year for thousands of applicants.

There's not mystery as to the popularity of the program, as top experts tell us everyday that it's ' Small ' business that generates employment and taxes in a big way

Why then do business people/entrepreneurs bother to investigate this type of loan? While many focus a lot of time and effort on raising equity capital from friends and family, angel investors, VC's, etc they are more often than not disappointed by their efforts in this area.

What is the appeal of the SBL loan? First of all its, longer repayment terms, as typical terms are 5-7 years. Secondly, approval is much easier as compared to traditional bank financing or other offerings from Commercial Finance companies that lend to the SME sector

It’s necessary to understand the type of loan you are applying for. For a starter, much a surprise to many is that there is no loan from the government. Industry Canada sponsors and administers the program and it simply guarantees the loans to Canadian chartered banks that provide these loans Banks therefore are more open to providing loans that in other cases they would not make!

Key to being successful is knowing what the program DOES NOT finance - and that’s working capital and inventory. It also does not refinance current debt. What it does fund is equipment, leasehold improvements and real estate.

If you're looking for a prompt answer , instead of ' maybe yes', or ' maybe no' when it comes to government backed loans in Canada seek out and speak to a trusted, credible and experienced Canadian business Financing Advisor with a track record of success who can help you cut red tape and make govt loans your lifesaver for capital.


Stan Prokop - 7 Park Avenue Financial :

http://www.7parkavenuefinancial.com

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

7 PARK AVENUE FINANCIAL = CANADIAN GOV’T GUARANTEED LOAN EXPERTISE









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

7 Park Avenue Financial

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

Direct Line = 416 319 5769

Office = 905 829 2653



Email = sprokop@7parkavenuefinancial.com


' Canadian Business Financing With The Intelligent Use Of Experience '

Stan Prokop

Bank Lending Plus Lesser Known Business Finance Alternatives Deliver Financing Solutions

Looking For More In Bank Financing

& Alternative Loan Solutions ?

OVERVIEW – Information on business finance alternatives and bank lending in Canadian business financing

Bank lending needs often come at a time when Canadian business owners and financial managers are not necessarily 100% in control of all the forces that might affect their business - external and otherwise. A business finance alternative might also be a solution for almost any business in any industry. Let's dig in.

Those same financing needs, as we've explained in the past come in different timelines, short, intermediate and long term. One of those external sources that many business owners forget is their vendors and suppliers.

Here collateral is not required, trade credit is MUCH easier to obtain and in many cases discounts for prompt payment may be offered and taken. Naturally stretching payables is a dangerous game, as you need suppliers and vendors on board when times are challenging - so while a/p mgmt is a key part of ' cash flow ' it's one that must be handled properly.

Bank lending comes in various forms - not all of which are understood by owners/financial mgrs in the SME commercial area. While it's true that Canadian banks do in fact offer ' unsecured' loans these are totally focused on... you guessed it... provable cash flow.

Typically these loans might be at a higher rate are and more long term in nature. The bottom line - ensure you balance sheet, profits, and historical and projected cash flows are up to mustard!

Bank lines of credit provide revolving facilities up to a maximum amount based on current asset holdings such as receivables and inventory. Typically these bank credit lines come with restrictions known as covenants and ratio maintenance - it's not just about the assets.

Commercial finance companies provide alternatives to the ' traditional ' bank loan sector. These tend to be asset based, easier to obtain, but come with higher borrowing costs.

Typical alternative financing solutions include:

A/R Financing - receivables represent your next closest asset class to cash and solutions such as Confidential Receivable Financing

Inventory Finance - These loans are typically for larger retailers and mfrs -

ABL Business Credit Lines - These are non bank business credit lines that combine the best of receivables and inventory financing into one revolving facility

Equipment Leasing / Sale Leaseback strategies

Tax Credit Monetization (SR&ED refundable tax credits, film tax credits)

Bridge Loans

Working Capital Term Loans

Government Guaranteed Small Business Loans

Purchase Order Financing

If you're not sure what financing solutions works best for your firm today and in the future that consideration can more easily be addressed by seeking the service and expertise of a trusted, credible and experienced Canadian business Financing Advisor with a track record of success with a track record of success.


Stan Prokop - 7 Park Avenue Financial :

http://www.7parkavenuefinancial.com

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

7 PARK AVENUE FINANCIAL = CANADIAN BANK LENDING AND BUSINESS FINANCING SOLUTIONS




Have A Question /Comment On Our Blog Or Canadian Business ?



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

Direct Line = 416 319 5769

Office = 905 829 2653



Email = sprokop@7parkavenuefinancial.com


' Canadian Business Financing With The Intelligent Use Of Experience '

Stan Prokop

A Tax Credit Financing Loan In Canada : SRED Finance Allows You To Do More With Less With Your SR ED Claim

How To Get Ahead Via SR&ED Loans

OVERVIEW – Information on the benefits of a SR&ED tax credit financing loan in Canada. SRED Finance loans are a way to monetize your SR ED credits , allowing you to cash flow refundable tax credits for working capital needs today

A SR&ED tax credit financing loan for your refundable SR&ED credits satisfies one basic need - recovering your r&d spending ! Let's dig in .


There's really only one reason to consider SRED Finance loans - accessing cash flow today, eliminating the wait around your SR ED filing. It's really as simple as that.

There are a number of ways to look at why Canada has chosen an ' incentive ' type program to encourage Canadian business owners to participate in scientific research. Canada Revenue Agency administers the program, and pretty well all top experts agree that it’s a tremendous way to receive a cash refund for qualified spending.

The majority of the SR&ED claims in Canada are prepared by external consultants who have a lot of expertise in this area. When you finance your claim you should know that the overall reputation and quality of your claim has a lot to do with that consultant. And given that the main collateral for a tax credit loan is in fact the claim itself it goes without saying that its one key factor in approving your claim for financing. Naturally if you have filed before with the same consultant things move along even more quickly.

Although the program has been around for over 30+ years in recent times significant changes have been made to the program. At the end of the day these changes could probably be summarized as follows -

Easier filing via today’s technology changes

Reduction in some of the previously allowed expenses

Pre-claim consultation and simplified online filing

A focus and disclosure requirement on who prepares your claim and for how much


Why and how does your firm finance a SR ED credit? If you're in the majority who believes ' cash is king ‘a SRED FINANCE LOAN is simply the immediate monetization of your claim. While some may view the challenge of preparing and filing a claim as work enough, just imagine the issue around waiting for your claim to be reviewed, audited, and approved.

That timeline could be weeks but quite often months. Don't forget also that the cash you receive on a SR&ED loan can be used for any general company purpose. While many firms plough back the funds into more R&D funds are also used for working capital/operating expenses, growth, etc.

Tax credit loans are financing in a very creative manner. You receive 70% of the total claim as a bridge loan. No payments are made for the duration of the loan and when your claim is approved and funded by the govt you immediately receive the balance of the claim less financing costs.

The application process? It couldn’t be more simple and basic. A typical loan package would include your financials, a copy of your SR&ED filing, and details on who prepared your claim and if you have had previous claims that were approved, the latter being important, nice to have, but not necessary.

Preparing a claim but haven’t filed yet. Your claim can also be financed on a pre-filing basis.

Looking to ' get ahead ' in R&D spending. Consider SRED finance loans as a quick way to monetize the tax credit asset. Seek out and speak to a trusted, credible and experienced Canadian business Financing Advisor with a track record of success





Stan Prokop - 7 Park Avenue Financial :

http://www.7parkavenuefinancial.com

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


7 PARK AVENUE FINANCIAL = CANADIAN SR&ED TAX CREDIT FINANCING EXPERTISE






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

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

Direct Line = 416 319 5769

Office = 905 829 2653



Email = sprokop@7parkavenuefinancial.com


' Canadian Business Financing With The Intelligent Use Of Experience '

Stan Prokop

Sources Of Finance For Businesses In Canada : Are You In Reverse Gear In Financing Your Business

Do You Really Know How To Finance Your Business?


OVERVIEW – Information on financing a business in Canada. What are sources of finance for businesses and how does the owner/manager access and choose those solutions

Financing a business in Canada can often leave the business owner/financial manager feel like they are operating in reverse gear .

The sources of finance for businesses don't have to seem unattainable if you've got some of the basics under your belt... along with some expert advice which never hurts. Let's dig in.

Timelines are not what you might be associating with your company's finance needs. However, the reality is that almost all the financing you require has some sort of timeline attached to it - typically short/ intermediate and long term. And in today’s relentless pace of business and technology the ability to adapt mid stream is quite often a necessity.

What then are some of the elements of understanding what financing you need and when. In our clients mind it's usually cost, and of course that's a factor. Some financing sources present a certain element of risk. Take for example Canadian chartered bank financing - low cost and plentiful if you qualify. Those qualifications often come with debt and liquidity ' covenants ' - Failing to meet those has the potential to put your entire business at risk.

Knowing what the big boys call your ' capital structure ' is important also. - that will affect the amount of debt you can take on. In some cases Canadian business owners and financial managers have found themselves in a position that their industry or the economy creates severe financing pressures - i.e. access to liquidity, etc.

Top experts seem to always agree that arranging financing in advance makes most sense - that sense of desperation never seems to impress the lender/banker/financier

In some cases refinancing your whole business with a focus to turning short term debt into long term might makes sense. Knowing you cash flow capabilities is key here.

What then are those business financing sources, and can we put some timelines on them?


SHORT TERM - typically one year in nature

A/R financing

Inventory finance

Bank lines of credit

Asset based non bank lines of credit

Purchase Order/Revenue Financing

Tax Credit Monetization

Bridge loans


INTERMEDIATE TERM - typically 3-5 years

Equipment financing

Working capital term loans


LONG TERM - 5-25 years?

Commercial mortgages

Mezzanine financing


If you want to reverse gear on financing a business properly seek out and speak to a trusted, credible and experienced Canadian business Financing Advisor with a track record of success who can ' right track' you to sources of finance for businesses that make sense.




Stan Prokop - 7 Park Avenue Financial :

http://www.7parkavenuefinancial.com

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

7 PARK AVENUE FINANCIAL = CANADIAN BUSINESS FINANCING EXPERTISE






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

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

Direct Line = 416 319 5769

Office = 905 829 2653

Email = sprokop@7parkavenuefinancial.com


' Canadian Business Financing With The Intelligent Use Of Experience '

Stan Prokop

Business Acquisitions Finance : SME Commercial Acquisitions Financing In Canada

Ever Prayed For Acquisition Financing ?


OVERVIEW – Information on business acquisition finance solutions in Canada. Financing acquisitions in the SME sector requires information on sources and methods of financing

Business acquisition finance solutions in Canada don't necessarily have to come with the requirement of saying a prayer. The ability to purchase, and finance a business requires knowledge of some fairly common sense factors coupled with expertise in some specialized areas. Knowing who to go to and what to talk about is key. Let's dig in.

Top experts tell us that acquisitions financing is such a hot topic for a couple of different reasons - one is the eternal need of the entrepreneur to purchase and operate a business, the other is the amount of businesses available today , particularly in the SME sector , as many founders/owners retire.

Only 1 question remains then - how do you finance the purchase? While Canadian chartered banks can certainly pick up a good part of the slack many owners, as well as the financial profile of the firm they are buying, simply don't meet bank requirements. Some statistics out of the states indicate that 80% of deals are bank rejected. That then requires specialized knowledge in a variety of other sources which can finance such transactions.

The one exception to bank participation in your deal is the Govt CSBF loan program, allowing you to finance business acquisitions to a maximum of 350k. However, that amount, as well as some other forms of ' top up ' financing might well get the entrepreneur on his or her way to close a deal.

Personal equity in the transaction is almost always a requirement in financing acquisitions. Amounts vary relative to the amount of capital you need and the risk profile of the deal. Also factored in there will be lender perception of your management depth and experience. Here's where solid concise business plans focused on cash flow and profits make total sense.

Don't forget also that the seller can also assist in the form of a vendor take back, the ' VTB '. While a lender appreciates the personal capital you are putting at risk the seller is also at risk to a certain degree when they agree to a vendor take back. More often than not they are always a positive influence on a deal.

The one thing to remember though is that in some cases a VTB might essentially be viewed as additional debt you are taking on. So that obligation must be factored into balance sheets and cash flows in your presentation.

Venture capitalists

and private equity groups finance only a small portion of businesses for sale - primarily because these transactions are often done in only the millions and tens of millions of dollars.

Other solutions to finance a business acquisition include:

Unsecured cash flow loans

Equipment financing

Bridge loans

Sale leasebacks

Asset based lending

Working capital term loans from Canada's crown corporation bank

A/R financing

If you're looking for solid, yet creative ways to finance a business purchase 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 your acquisition needs.



Stan Prokop - 7 Park Avenue Financial :

http://www.7parkavenuefinancial.com

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

7 PARK AVENUE FINANCIAL = CANADIAN BUSINESS ACQUISTIONS FINANCING EXPERTISE





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

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

Direct Line = 416 319 5769

Office = 905 829 2653



Email = sprokop@7parkavenuefinancial.com



' Canadian Business Financing With The Intelligent Use Of Experience

Stan Prokop