Here’s Your Fighting Chance For Cash Flow Solutions! How To Pinpoint A Canadian Business Finance Solution

Looking For Working Capital Survival Techniques?

Information on cash flow solutions for Canadian business owners . Understand the problem and find a business finance solution .


Canadian business owners and financial managers are looking for ' fight back' type cash flow solutions for their survival and growth challenges. Let's examine that from two angles understanding and pinpointing the problem, and then implementing a satisfactory business finance solution for your firm, one that makes sense in the here and now!

While clients we talk to are often very focused on fixing the problem we’ve felt it's just as important to understand how and why they got there. Makes sense right?

If you step back and take a closer look at what's going on in your business you will see that the constant pattern of payments and receipts to your firm dictate the need for Canadian business financing at certain times. The cycle typically constantly repeats itself, your company buys goods, generates a payable, incurs costs in creating your products and services and finally invoice generation to your clients. And then you wait!

That's when we arrive exactly at the crux of the matter as typically at this time your cash shortfall is at its greatest point. All the while your firm of course has payable and creditor obligations, and let’s not forget the tax man!

Now we are getting to the core issue, creating cash flow solutions to finance these needs. We now arrive at a point where many companies ' blow it ' for lack of a better word. That's because the obvious solution is ' the bank '. We can't count the number of times clients told us they have approached their bank on what we can politely term a ' short notice'.

Guess what though. Banks don't like to lend on a short notice. Quite frankly they are managing their own cash flow issues! Clients simply often don't realize that at this point in a company's need for a business finance solution that insolvency risk is at its greatest.

The other irony of our situation as described above is that in many cases business has never been greater for your firm. New contracts, new orders abound! Yet history tells us many companies, small and large have gone under when profits and sales were great, but cash has run out.

Solid and savvy Canadian business owners and financial managers will step up to the challenge this time and learn to plan better for short term borrowings. You don’t want to over borrow but at the same time you don't want to commit yourself to having excess cash and liquidity. (Although that’s a problem clients never seem to have!)


One of the best ways you can monitor your cash flow needs is to monitor on an ongoing basis changes in your assets and debt. Business owners often don’t realize that the transfer of funds between those two identify the movement of your cash.

If assets go down cash has been generated from the asset, if assets go up you have in fact invested in this asset, and, guess what, your cash has gone down.

In Canada you have a number of available cash flow solutions for working capital needs. They include properly managed bank debt via a solid relationship and track record. Companies that can't qualify have access to asset based lines of credit, working capital facilities, receivable and inventory financing on their own or together and even monetization of tax credits and purchase orders.

Looking to better understand what business finance solutions makes sense for your firm, and why? Speak to a trusted, credible and experienced Canadian business financing advisor to determine your firm’s best course of action.





Stan Prokop - founder of 7 Park Avenue Financial –


http://www.7parkavenuefinancial.com


Originating business financing for Canadian companies , specializing in working capital, cash flow, asset based financing . In business 7 years - has completed in excess of 80 Million $$ of financing for Canadian corporations . Core competancies include receivables financing, asset based lending, working capital, equipment finance, franchise finance and tax credit financing.
Info re: Canadian business financing & contact details :


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

An Unfair Edge ? Offer Customer Financing At No Cost To Your Company! A Financial Program Via Canadian Vendor Leasing Works

Improve Sales and Marketing Results with Customer Financing Programs – Zero Cost – Large Results!


Information on vendor leasing via a customer finance offering for your clients . Let a financial program produce positive results for your firm .


Looking for a (legitimate!) unfair edge in Canadian business financing? Who wouldn't want that extra ' secret sauce ' that all businesses strive to achieve when competing within their own market.

We're talking about offering a financial program, at no cost, to your clients, giving you a solid marketing edge, and something the competition may not have, or even know about! That’s why a customer finance program via vendor leasing could well put your company at the head of the pack in your own market.

Could there be any more common sense attached to the simple concept of
providing your client with a financial solution to acquire your product or service? And, as we noted, that could well be at no cost. As you may have guessed the major auto manufacturers mastered this same concept, about 50 years ago! so it might be time to get on board.


Offering such a program does two basic things:

1. It makes the final purchase decision much easier for your clients

2. It doesnt take you as long to complete a sale - in effect your sales cycle is significantly reduced

Getting back to the competition, doesnt it also make sense that a financial program not offered by your competition puts you in a much better stead of winning the sale . We think so, and we've since it proven time and time again.

Depending on what study you are reading 8-9 out of ten companies in Canada utilize lease / loan financing for their asset acquisitions. If your customer is one of those firms doesnt it make sense that you’re simply offering them a financing solution that makes sense with something they are already comfortable with... well you get the drill .. you're one step close to making that sale, and winning over your competition.

How? That’s the next point to ponder in our efforts to make sure clients have that inside edge. How do you as a business set up a program that in effect could cost you nothing? Naturally if you want such k a customer finance program to not be free to your company then feel free to invest hundreds of thousands or millions of dollars into your own captive finance firm. Oh and by the way, hire the right talent and set up the proper infrastructure also, put those at the top of you ' to do ' list. The bottom line is your firm quite probably doesnt have the capital, financial management, and operational capabilities to set up and start your own finance firm.

Not interested in that? We fully understand! That is why the easy and logical solution is to work with a trusted third party that will provide the capital, take on the risk, and work to close transactions, in effect becoming a win/ win scenario for your firm and theirs.

Consider spending some time to investigate a customer finance program that makes sense for your products and services. Speak to a trusted, credible and experienced Canadian business financing advisor who can ensure you have a partnership program with the right party that gives you a clean program, with simple documentation, and the right amount of expertise and capital to give you the ' unfair edge ' in sales and marketing growth .




Stan Prokop - founder of 7 Park Avenue Financial –

http://www.7parkavenuefinancial.com

Originating business financing for Canadian companies , specializing in working capital, cash flow, asset based financing . In business 7 years - has completed in excess of 80 Million $$ of financing for Canadian corporations . Core competancies include receivables financing, asset based lending, working capital, equipment finance, franchise finance and tax credit financing.
Info re: Canadian business financing & contact details :

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

Receivable Cash Flow Financing .The Only 2 Times To Consider Canadian Factor Funding

Two Times To Consider An Alternative Financing Strategy


Ancient Chinese proverbs and receivable cash flow financing and factor funding. A connection? We thought so, as we were taken by one we heard the other day. It went something like this, ' the best time to consider planting a tree is 20 years ago, the 2nd best time is now '.

Timing is everything in business... Canadian business owners and financial managers know that .That is why we think a strong case can be made to turn our same proverb towards consideration of receivable financing , something you maybe should have done already, or perhaps start considering now . Let' explain.

When business owners look at financing alternatives they are usually looking at their current situation. As the Canadian economy seems to seesaw back and forth these days between good news and bad news its Canadian business that is caught in the middle, experience continual frustration for obtaining their financing needs.

We're talking mostly about small and medium sized businesses , as larger firms always seem to be in a better position don’t you think.

So that of course brings us to receivable cash flow financing, one immediate solution that you can access today for cash flow and working capital. It's generally viewed as an ' alternative ' financing but quite frankly in our opinion it's more mainstream everyday as thousands, yes thousands of firms embrace this finance strategy.

That of course just might mean that the time is... well... now for consideration by your firm. The reason you might be considering A/R finance now is simply your inability to collect receivables in a timely fashion, from clients that seem to feel they are forever on extended terms. (Clients tell us they don’t remember granting those extensions!) We add also that the ultimate irony sees often to be that the larger firms become a major collection challenge for companies, such as yours, who might be significantly smaller.

Often times your receivable portfolio is a function of your growth strategy. That growth strategy becomes capital intensive, as you are forced to continually maintain an investment in inventory and of course receivables. So while clients tell us they would like to see A/R reduced, to cash of course reality is that it rarely does for the typical SME type firm.

A lot of clients we meet are self financing. That is a double edged sword in that it constrains many businesses from growing. They are also reluctant to take on more debt and increase financial leverage. If sales drop or operating performance decline you can well assume problems are going to occur with respect to your relation with lenders to your firm.

Factor funding reduces leverage. It is not debt; it’s simply a monetization of your A/R into immediate cash at a cost of 2-3% on a monthly basis.

So when is the time for Canadian business owners to embrace A/R financing? According to our Chinese proverb it was either a long time ago, or today! Receivable cash flow financing allows you to monetize your A/R in real cash flow; you've just given yourself an alternative to bank financing, minimized the emphasis on personal guarantees, and put yourself in control of your daily or monthly borrowing.

Speak to a trusted, credible and experienced Canadian business financing advisor who can assist you in determining when this strategy is right for your term, yesterday, or today!




Stan Prokop - founder of 7 Park Avenue Financial –

http://www.7parkavenuefinancial.com

Originating business financing for Canadian companies , specializing in working capital, cash flow, asset based financing . In business 7 years - has completed in excess of 80 Million $$ of financing for Canadian corporations . Core competancies include receivables financing, asset based lending, working capital, equipment finance, franchise finance and tax credit financing.
Info re: Canadian business financing & contact details :

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

Innovative Financing From Canadian Leasing Companies . Mastering The Lease Versus Buy Decision

Information for Canadian companies seeking financing from leasing companies . Master the lease versus buy decision and reap the financial benefits .



At one point or another Canadian companies of all size realize that financing new or existing assets via leasing companies in Canada works far better than buying those assets; in effect they have mastered and understood the lease versus buy decision.

It's never hurts for us to cover the basics with clients, so we constantly re-enforce the fact that equipment leases and loans allow you to stay ahead of the technology curve in your industry - in effect you have the ' latest and greatest ' with which to compete .

Conservation of capital is also a key point at the top of our list; in effect you don’t have to service a bank term loan for the asset. Bank loans for assets also have related issues that can significantly impact your firm, such as reduction in your overall borrowing arrangement, etc. It's no secret then that 80% of all North American businesses lease some assets they need for their firm.

Your monthly payment of course is dependent on the asset size and the structure of your lease or service agreement with leasing companies in Canada.

Innovation in financing via a lease often comes from the type of lease you enter into. In Canada two primary offerings are on the table - the capital lease, aka ' lease to own ', and the operating lease, which we can effectively call the ' lease to use'.

Innovation abounds in operating lease financing. It’s the ultimate solution for investments you make in areas such as technology, telecom, etc. Most borrowers, (and we definitely don’t agree with their focus) tend to hone in on the monthly payment. In an operating lease the monthly payment is significantly lower, anywhere from 5-20% depending on the asset size and type.

At the end of the term of your operating lease the equipment is not fully paid for. Don’t worry, that’s a good thing, because a properly structured operating lease via Canadian leasing companies allows you to at that point consider purchasing, returning, or continuing the arrangement. Those options are standard in a properly structured operating lease.

While payments on a capital lease are higher don’t forget that you own the equipment at the end of the term. This of course can be a double edged financial sword! , given that the equipment might have either significant value, some value, or no value. On balance we would say that the majority of companies that enter into a capital lease scenario do so mainly because they want to conserve cash flow.

We referenced the ' lease versus buy' decision. That’s the term referred to as the Canadian business owner or financial manager tries to decide whether he should lease or buy an asset.


Is any financial decision always 100% right? Of course not, so when it makes sense buying an asset gives you ownership of the asset, plus your ability to control the ultimate use and residual value. In some cases your accountant might be able to show you buying is less expensive than lease finance.


We tell client that in the financing decision process they should consider things such as the final monthly payment, related services to the asset that are financeable, their purchase options, as well as the cash flow effects of the transaction . Oh and by the way, most busines owners quickly realize that lease financing is easier to obtain and receive approval for. Leasing companies in Canada are thriving and want your business.

Speak to a trusted, credible and experienced Canadian business financing advisor on how innovative financing from Canadian leasing companies might make sense for your firm. You'll have mastered the lease versus buy decision!





Stan Prokop - founder of 7 Park Avenue Financial –

http://www.7parkavenuefinancial.com

Originating business financing for Canadian companies , specializing in working capital, cash flow, asset based financing . In business 7 years - has completed in excess of 80 Million $$ of financing for Canadian corporations . Core competancies include receivables financing, asset based lending, working capital, equipment finance, franchise finance and tax credit financing.
Info re: Canadian business financing & contact details :


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

Is The Guarantee Of The SBL Canada Small Business Loan Really Guaranteed? Increase Your Chances For Government Loans

Don’t Just Survive ! Grow Your Business With An SBL Loan.


Information on the ‘ SBL ‘ ; Canada small business loan. How can business owners, franchisees, and entrepreneurs increase their chances of approval for government loans.


A pretty basic question. Is the Canada small business loan, i.e. government SBL loans, really ' guaranteed '? Two points here, first of all the loan is guaranteed by the government to your lender, but you are certainly not ' guaranteed of approval! But with the right knowledge, and the right preparation you can dramatically increases chances of approved funding.

Let's examine how you can ensure your business is approved for financing under this program. Some of the techniques and info we share we could almost characterize as subtle, and some are simply a key requirement to get the job done. It’s not hard to take ‘guesswork ‘out of the program and increase the odds of financing approval.
You must be able to at least understand the lenders language, even if you don’t speak it everyday.

At the end of the day it’s about some basic organization around your information, dealing with the right party, and being able to clearly demonstrate that your business is the right firm with which to have a borrowing/lending relationship.

Doesnt it make sense that if certain information is required for the Canada Small Business Loan that you are able to provide it? That info that's required is hardly ' rocket science' by the way; it’s actually a short laundry list. The essence of that info is a business plan, quotes or invoices on what you want financed, a cash flow forecast, and information about your self with respect to assets and liabilities and your personal credit history.

You want to be able to demonstrate how the financing will assist your business, whether it’s a new business, a franchise, or assets required to operate and grow your company. When we listen to clients who say they have spent far too long in getting approved for government loans we can usually demonstrate they have responded properly to the financing info request.

We're fond of an expression called ' deal fatigue '... that's simply when enthusiasm by you and your lender hit an all time low on your transaction. So by putting a package together with all the info, including a positive attitude and approach, you are able to present a strong picture of your capabilities and experience.

The SBL small business loan is actually administered by Canadian banks on behalf of the government department, Industry Canada. There isn’t a day that goes by when we don’t hear the comment ' banks arent lending ', or ' banks are only lending to their existing client relationships'.

We tell clients they will never be in a position to change the way banks do business in Canada (God knows we've tried that ourselves!) but you can take advantage of programs that clearly are meant to finance and grow your business.

Many clients are too focused on rates on all types of business financing - That’s our opinion. The reality is that using a 100k loan as an example an interest rate difference of, say 5% will only mean a monthly payment difference of a few hundred dollars. And the reality is that rates on government loans are fixed anyway. Bottom line; don’t focus all your efforts on rates when any new business financing can help your business grow.

The Canadian SBL program provides millions of dollars of financing to businesses like yours. It helps your business achieve financing it otherwise could not obtain. As a borrower you need to deal directly with both the positive and negative aspects of your loan, and you must be able to project positive future performance. That's not hard to do by the way.

You can successfully achieve financing by working with an advisor or banker that both understands the program and can ensure your financing is fast tracked to success via the right information presented in a positive manner.




Stan Prokop - founder of 7 Park Avenue Financial –


http://www.7parkavenuefinancial.com


Originating business financing for Canadian companies , specializing in working capital, cash flow, asset based financing . In business 7 years - has completed in excess of 80 Million $$ of financing for Canadian corporations . Core competancies include receivables financing, asset based lending, working capital, equipment finance, franchise finance and tax credit financing. Info re: Canadian business financing & contact details :


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

Buying And Financing A New Franchise In Canada? What Franchising Loan Info Do You Need?

Buying and Financing a Franchise Opportunity In Canada?

Information on financing a new franchise in Canada . Consideration for franchisees who are buying a franchise and looking for the appropriate loan .



Financing a new franchise. Simple? Difficult? Impossible ? Our answer would be ' simple ‘... never, not really. Difficult... we don't think so, you be the judge. Impossible? With the right information and assistance, absolutely not.

So what in fact does a Canadian franchisee need to know about funding a franchise business in the Canadian marketplace? A good start are some of the basics - we're going to assume you have a general knowledge of what franchising is , with an emphasis on the pros and cons of purchasing what is hopefully a proven business model in your chosen industry vertical . That vertical might be QSR (Quick Service Restaurants) (boy are there a lot of those!) service oriented businesses, the growing healthcare industry... and on it goes.

In Canada ( and we're assuming south of the border also!) your personal financial situation as well as you related experience play a key role in the overall financial plan you will undertake to successfully complete a business financing .

A great start is to prepare a personal net worth statement; simply speaking it’s a basic form that shows what you have, and what you owe. The difference is known as your personal net worth. Hopefully what you have is more than what you owe; otherwise your chances of financing success are somewhat slim, if not non existent.

A business plan prepared by yourself or an advisor will hopefully show you have thought out your cash flows and profit potential. Everyone wants to be a ' winner ' in franchising, that’s understood, and it seems only common sense that the more successful a franchising brand you attach yourself to will translate into financial success.

Don't forget also the royalty aspect of your planning. Royalty fees when you purchase a franchise typically tend to be in the 6-8% range, and those fees should be carefully factored into your overall profit and cash flow scenario.

The old adage that the 3 most important things in real estate are location, location, and location! If your business is dependent on retail / consumer traffic that’s important.

Does your lease and location factor into your financing? Yes, it does, as it’s critical that your lease have a term that appropriately matches the term of your franchising loan. Simply speaking, don't expect a 7 term loan if your premises lease only has 3 years left and is not renewable in your favor.

The amount that you are required to invest as your portion of the business capitalization varies. It depends on a couple basic factors. Those factors are as follows:

1. The minimum amount that might be required from the lenders perspective

2. The minimum amount that might be required your franchisors perspective. This is an especially important number because it is usually drawn from their experience as to what amount of capital units in their chain require to be successful.
3. A third factor is the amount of risk you personally are willing to take in your new franchise venture. In this case ' capital ' is what we tell clients could be a double edged sword. For instance, you could put up 100% of the funds yourself. In that case you have little debt risk, but have a lower return on investment. Alternatively borrowing without a decent equity position puts you at the mercy of your franchise lender when things go wrong, as they sometimes do. And need we mention that every business, franchise or otherwise needs a working capital cushion.

It may seem the wrong way of looking at it, but as a Canadian prospective franchisee you might well want to take some time to understand why franchisees fail, and what you need to know to buy and successfully finance a new franchise in Canada.

The importance of a trusted, respected and experienced Canadian business financing advisor can't be underestimated. Whether you are buying a new unit in the system, or purchasing a resale from an existing franchisee understand your reward, and risk.




Stan Prokop - founder of 7 Park Avenue Financial –


http://www.7parkavenuefinancial.com


Originating business financing for Canadian companies , specializing in working capital, cash flow, asset based financing . In business 7 years - has completed in excess of 80 Million $$ of financing for Canadian corporations . Core competancies include receivables financing, asset based lending, working capital, equipment finance, franchise finance and tax credit financing.
Info re: Canadian business financing & contact details :

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

6 Ways To Compare And Analyze Asset Based Lending Revolving Credit Facilities . ABL Financing Works

Are You In a Position To Properly Compare Business Lines Of Credit ? You are now!

Information on abl revolving credit facilities . Why financing via asset based lending is increasing as an option in Canadian business .



Clients who listen to us tout the positive aspects of business revolving credit via abl asset based lending and financing sometimes have a great question for us ; namely ' How can we compare this type of Canadian business financing to other forms of lending, i.e. the traditional chartered bank line of credit ?'

Good question! Right? So a good way to do that is to set up 6 common benchmarks that allow you as a Canadian business owner or financial manager to do a proper analysis or comparison. Let's cover off the basics of those 6 comparison points.

First of all, we can start with borrowing capability. In general terms we can make the following statement - under a bank facility you have a pre -set credit limit that typically is reviewed annually. However with an ABL facility your borrowing is always tied to the asset base of your firm, which typically is a total sum or receivables, inventory, unencumbered equipment, and even real estate. While bank A/R facilities are more often than note capped at 75% of A/R the asset based revolver will typically come in at 90%. On top of that you will also receive more generous inventory margining 99% of the time, in our opinion.

Let’s move on to overall structure, our 2nd comparable. Larger more high quality asset based facilities typically have a multi year length, while your bank facility is renewed (hopefully!) annually based on historical financial performance.

Point # 3, which we will call follow up or monitoring via your lender. Here is where a dramatic difference occurs. Your bank will assess and provide and renew the credit facility based on operating ratios, loan covenants, external collateral perhaps, and quality of owner guarantees.

Asset based lending takes a different approach; it counts your assets, both at the start of the facility, and periodically during the facility. So in the same manner that you provide what bankers call ' borrowing certificates ‘the ABL lender actually only focuses on those same assets within those certificates. Are we making ourselves clear, it’s always about the assets!

Point # 4. Bank lines of credit are available from... you guessed it... Canadian chartered banks. The ABL revolving credit universe in Canada, while not huge, is non bank in nature.

It is made up of ' unregulated " (banks are regulated) independent finance firms, small and large that offer revolving credit financing to Canadian business. Faculties are available from 250k to hundreds of millions of dollars in size. As such all types of firms that might not qualify for traditional bank financing are immediately eligible for ABL finance, even if they have financial challenges, up to and including considering a bankruptcy filing!

Let’s move on to point # 5 - pricing. While bank pricing is generally perceived as the best financial cost on Canadian business borrowing clients of the same credit quality can achieve the same or better pricing via an asset based line of credit. Firms who can't obtain bank lines of credit still qualify, but of course pay more for these facilities.

Last, but not least, covenants. While banks focus on cash flow coverage (typically 1.25:1) balance sheet ratios, and leverage ABL lending draws on appraisals of assets, reporting, and operational type audits.

What’s better for your firm a traditional bank business line of credit or an ABL financing. You're now in a position to better decide. Speak to a trusted, credible and experienced Canadian business financing advisor today on moving forth with the selection of your choice.





Stan Prokop - founder of 7 Park Avenue Financial –


http://www.7parkavenuefinancial.com


Originating business financing for Canadian companies , specializing in working capital, cash flow, asset based financing . In business 7 years - has completed in excess of 80 Million $$ of financing for Canadian corporations . Core competancies include receivables financing, asset based lending, working capital, equipment finance, franchise finance and tax credit financing.
Info re: Canadian business financing & contact details :


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

Working Capital Management Is A Numbers Game When Cash Flow Financing Needs Are Now

Empower Your Company With Working Capital And Cash Flow Solutions. Financing The Gap!


Information on working capital management techniques when you need cash flow financing . Plan now for financing needs tomorrow .






Your company’s working capital is the amount of funds which is working to solve your short term operating needs. A good way to look at this is to think of all your current assets as your gross cash flow, and if you subtract your current payables and loan payments due, etc you then have a net working capital amount.


How your firm manages those current assets, and the amounts you have invested in that part of the balance sheet will ultimately determine what cash flow financing options are available to your firm, traditional or otherwise. Your ability to turn over those current assets, i.e. A/R, inventory, etc is what impresses a lender, as they view that turnover as ultimately repaying working capital loans, operating facilities, asset based loans, etc.

Most business owners don’t see it this way, but your cheapest form of borrowing is actually your short term liabilities such as payables. The challenge though, is that those payables have short timelines with respect to being due, and your firm needs the working capital management solutions to address that need.

The irony that we have always found in working capital discussions is that the often used ‘current ratio’ is somewhat meaningless. It doesn’t do a lot to reflect what is happening now or in the future. Very simply speaking, most accountants or analysts look for a current ratio of 2:1, or more. So is a 4:1 ratio fabulous then?? Not really if your inventory is in work in process and your receivables are slow or uncollectible!


Accounts receivable and inventory are the two main asset classes in your working capital. No surprise there. Your ability to monetize (borrow against) them is ultimately your cash flow financing savior.
So, as we are constantly preaching, it’s all about the timing of your working capital and cash flow needs. It’s that constant pattern of inventory turning to receivables turning to cash that dictates your success or failure in working capital management. A few very basic calculations that every business owner should know are your days sales outstanding in a/r, as well as your inventory turnover. They are simply arithmetic calculations.


Because of those two great assets, A/R and inventory you not only want, but are often forced to consider borrowing against these assets. In Canada this is accomplished in a variety of manners. They include bank lines of credit, non bank asset based lending facilities, receivable financing on its own, and occasionally inventory finance on its own merit. Even your SRED tax credits or purchase orders can be financed if applicable . You make a smart decision when you utilize one of the above solutions with a focus on borrowing what you need and using and managing daily to that need.


The problem we run into all the time is when clients approach us when they need funds urgently, typically when the overall risk is greater because of their current solvency situation. The bottom line is to determine the minimum amount of cash you need, include a buffer or bulge type scenario, and plan your working capital management and cash flow financing in a proactive manner. Some early warning signs of cash flow issues include declining cash balances ( obviously ) , extreme bulges in new orders , supplier payment issues , over 90 day receivables, etc.

In summary, don’t over borrow, and don’t under finance at the wrong time. Speak to a trusted, credible and experienced Canadian business financing advisor on solutions available today in cash flow finance for your company’s needs.




Stan Prokop - founder of 7 Park Avenue Financial –


http://www.7parkavenuefinancial.com


Originating business financing for Canadian companies , specializing in working capital, cash flow, asset based financing . In business 7 years - has completed in excess of 80 Million $$ of financing for Canadian corporations . Core competancies include receivables financing, asset based lending, working capital, equipment finance, franchise finance and tax credit financing.
Info re: Canadian business financing & contact details :



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

Business Equipment Leasing And Financing In Canada . When And With Whom To Lease

Carefully pick your partner and pick your solution in Canadian business lease financing .


Information on equipment leasing in Canada . When business lease financing makes sense, and what companies you should be dealing with .



As always, it's a question of the right time and right place. We're discussing business equipment leasing in Canada. When should Canadian business owners and financial managers consider lease financing for asset acquisition and use. We've got some basic checklists on what works when, and, as importantly, with whom!

We're forgiving you if you feel that the many advantages of equipment finance in Canada are sometimes overdone, or overstated. There is of course things such as ' pride of ownership ‘. Furthermore, some, certainly not all assets appreciate over time, or at least hold their value, so there are certain times when 100% purchase for cash / outright ownership seems to make sense.

Additionally, if you enter into an operating lease scenario you have certain obligations to purchase or give back the equipment at the end of the lease. What then, especially if a suitable alternative or upgrade isn't available?

It's just that we think we can count on one hand the amount of assets that appreciate over time these days, and items such as computers certainly aren’t one of them.

So when exactly should the business owner or financial management of a firm consider leasing? One of those cases might be when it's simply cost prohibitive to purchase an asset outright, or if the rates to finance that purchase via a loan seem too high.

Most businesses in Canada don't fully investigate the accounting and tax implications of a lease vs. buy scenario. If they did they might find that those benefits, coupled with a reasonable and affordable monthly payment make business equipment leasing an obvious choice.

Additional guidelines that might make you consider lease financing are areas such as equipment obsolescence, usage that is only temporary in nature, etc.

So now that you've determined when to lease the question becomes ' with whom ‘?! As you consider a lease firm you should, at the same time have a reasonable working knowledge of what type of lease you want. That translates into 3 basic choices in Canada, the lease to own, the lease to use, and the leasing back of your assets. Respectively these choices are known as capital leases, operating leases, and a sale leaseback.

We can imagine the inexperienced business owners or financials manager’s quandary, or indecision on who to deal with. In Canada you have 4 choices, and it makes sense to know the benefits and basics of each of these.

Your four choices are commercial finance leasing companies that are most often private firms specializing in leased assets. Choice # 2 bank leasing companies in Canada; these are closely tied to their parent companies, Canadian chartered banks. Choice 3 is often a fabulous choice, these are the prisoners! Prisoners? Well actually we mean captives, they are finance firms related directly to the manufacturer of the business equipment you wish to lease.

Choice # 4 is often the safest bet. It's a Canadian business financing advisor who has knowledge and relationships with all of the above firms .These players, with the right credentials and reputation can bring true value and save you thousands of dollars on any single transaction. Look for past experience, credentials, etc.

Knowing when and with whom to finance your assets can put your firm on the track business financing success.






Stan Prokop - founder of 7 Park Avenue Financial –


http://www.7parkavenuefinancial.com


Originating business financing for Canadian companies , specializing in working capital, cash flow, asset based financing . In business 7 years - has completed in excess of 80 Million $$ of financing for Canadian corporations . Core competancies include receivables financing, asset based lending, working capital, equipment finance, franchise finance and tax credit financing.
Info re: Canadian business financing & contact details :


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

Receivables Funding In Canada . The Good , The Bad And The Ugly ! Sales Of Receivables Factoring Works If …..

Winning Financially With A/R Finance in Canada


Information on sales of receivables funding for Canadian business owners . Factoring works best under these conditions .



It's probably just us, but when it comes to business financing in Canada no other method of financing your business is as controversial or misunderstood as sales of receivables financing, aka factoring funding.

Let's examine some key points that will clarify the ' Good, Bad and Ugly ' of receivable financing in Canada.

Let's start off with the ' good ' as we think you will soon might find that the ' bad' and the ' ugly ' are simply misunderstandings , but we'll let you decide.

So whey do Canadian business owners and financial managers embrace this newer form of financing in Canada. Simply because it supercharges your cash flow - by selling your A/R you in effect maintain cash flow for operations, and eliminate the need for additional debt or taking on or putting in new equity. We constantly remind clients that the dilution of your equity is in fact the costliest method of financing, everyone pretty well agrees on that.

Another point in our ' Good ' column is that if structured properly your sale of receivables financing sets you up for unlimited capital and cash flow - simply speaking your working capital grows lock step with your sales. Not too many other methods of business financing can make that statement.

The Ugly. The following point is simply the most recognized complaint when we talk to clients. It involves the mechanisms under which A/R financing works. 99% of the structures used by factor companies involve the factor firm validating the credit worthiness of your clients, and getting involved in the billing and collecting of your receivables. Why. Their answer would be that you have sold them the receivable and it’s theirs to collect.

So that’s bad, right? Most Canadian business owners and financial managers that we speak to would say they would prefer to bill and collect their own receivables, and maintain those client relationships that are so important. Enter ' the good '! Here's the good news, most Canadian businesses contemplating sale of receivables funding / factoring are eligible for what we term ' Confidential receivables financing ‘. Utilizing that mechanism your firm bills and collects its own receivables, maintaining total control on the billing and collection function. You in term remit those funds to your finance firm, simply because you have been advanced those funds already.

The Bad. Here is where misunderstanding reigns supreme in A/R financing. It's the ' price ' or ' cost ' of this method of business financing. When you finance a receivables portfolio a factor firm buys your A/R at an ongoing discounted price. That price, on balance, in Canada is 2-3%. Business owners in Canada confuse that purchase discount fee as an interest rate, and that’s a large part of the problem. In reality its how you manage that 2-3% that ultimately reflects your total cost of financing. You can manage that cost by adjusting part of the cost into your cost of sales - we remind you that you’re already absorbing a large cost by carrying receivables and inventory already.

And by the way, with that new found sale of receivables funding cash flow you can now take supplier discounts if they are offered, which by the way, are generally in the 2% range. Want more good, rather than bad or ugly?! You can now enhance your purchasing power with suppliers, and if you choose (not always recommended by us) you can offer extended terms to your clients that your competitors might not be able to.


The bottom line today. Thousands of Canadian businesses embrace sale of receivables funding / factoring everyday. Consider speaking to a trusted credible and experienced Canadian business financing advisor to wade through the good of this method of business finance, and you might just find that bad and ugly are either misunderstood or don't exist . That’s a working capital 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 7 years - has completed in excess of 80 Million $$ of financing for Canadian corporations . Core competancies include receivables financing, asset based lending, working capital, equipment finance, franchise finance and tax credit financing.
Info re: Canadian business financing & contact details :


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

Equipment Loans And Leases In Canada ! Which One Of Three Options in Business Leasing And Financing Works For Your Firm?

Leasing Business Assets Makes Sense - 80% Of Canadian Firms Utilize This Financing Strategy



Information on equipment loans and leases in Canadian business asset financing . Which leasing options works for your firm?



The need is often there, but the solution might not be always as obvious as it seems. We're talking about equipment loans and leases in Canada - those unique structures that allow business leasing strategies used by your firm to acquire financing for the assets it needs... to operate, survive, and grow!




When Canadian business owners and financial managers are faced with the challenge of fixed asset finance their oft immediate option is the traditional business loan. This might be a bank term loan for example. The criteria, we in the industry call it ' the credit bar ' might often be fairly high to achieve the types of term financing you need on structures that make sense for your firm.




So, if that was Plan A, and Plan A doesn’t work, whats left? The answer, quite simply is equipment leases for business financing. Rates and terms are quite competitive to the bank, and Canadian business, in general we feel, seems to think that lease financing proceeds with less of a ' hassle '.




Your equipment needs might be from several aspects of your business, computing, machinery, office equipment, etc. All of those assets of course run your company; they're important.




We spoke of the bank term loan as an option, the other more obvious one might have been a cash purchase , using the funds ( if they are there !) to acquire the equipment outright . However, using that capital in this manner if often a classic ' mismatch ' of funds; your firm, incorrectly so, is using short term cash for long term asset acquisition. Bottom line, not a good thing. The reality is you want to use those funds for operating and revenue growth.

That then brings us to what we feel what might be the optimal solution in business financing for assets, ' leasing '. Your new found ability to acquire assets with little or no down payment, bundle in other costs such as shipping, installation, warranty, etc becomes a solid new strategy for asset finance for Canadian business owners.

When utilizing lease finance you are in effect leveraging your cash flow, getting the most out of it, all the same time matching outflows of cash with future inflows of sales and profits arising out of the use of those operating fixed assets you are financing. Our strategy clearly works best for companies who find they need to constantly refresh assets such as computing, or shop floor equipment.



Oh, and by the way, thousands of businesses that don't qualify for bank term loans for assets do in fact always qualify for lease financing. Transactions are structured on a combination focus on the value and use of the asset, your current and future cash flows, etc .Oh, and by the way, your lease payments can generally be expenses and set off against tax obligations.



We spoke of three options in Canada under equipment loans and leases financing scenarios. Those three options are capital leases, operating leases and sale leaseback of assets you own already. Each of these options has different benefits, and gives your firm different rights and obligations. Speak to a trusted, credible and experienced Canadian business financing advisor to identify which of these 3 options make sense for your firm.




Stan Prokop - founder of 7 Park Avenue Financial –


http://www.7parkavenuefinancial.com


Originating business financing for Canadian companies , specializing in working capital, cash flow, asset based financing . In business 7 years - has completed in excess of 80 Million $$ of financing for Canadian corporations . Core competancies include receivables financing, asset based lending, working capital, equipment finance, franchise finance and tax credit financing.

Info re: Canadian business financing & contact details:


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

SBL Loans! Is The Canadian Government Business Loan Help From Where You Least Expect It? Gov Programs For Business Finance

Government Assistance In Financing ? Yes! Information on the Canada government business loan . SBL loans are the leading example of gov programs that work for Canadian business financing . Help from where we least expect it. We can't speak for you but we've always appreciated assistance in business, especially when it comes from sources you least expect. We're talking about the Canadian government business loan, in our opinion it’s the best or 2nd best of gov programs that work. We've always loved the line ' Hi, we're from the government and we're here to help ‘... which is why SBL Loans in our opinion are the real world example of a phrase that is often associated with negavity. ‘Government ' ... ‘Banking’ ... many small and medium sized business owners cringe when they contemplate those words. Not today, though. The government business loan in Canada is a primary offering via INDUSTRY CANADA in Ottawa. It offers SBL loans up to $ 500,000.00 for the purpose of financing equipment assets, leaseholds, real estate, software, etc. In actuality the 500k limit is specifically related to real estate, while other asset categories are capped at $ 350,000.00. The program provides a long term fixed or variable rate financing to businesses looking to start, expand, and grow! Misinformation abounds around the program; we're always surprised at the amount or lack of solid understanding and facts around gov programs such as this. One of those main misconceptions revolves around who the lender is. We can at least forgive our clients who misunderstand the fact that while this is a government sponsored and guaranteed loan, in actuality the actual day to day dealings are in the private sector. One of the greatest benefits of the program is something we have alluded to already, its that SBL loans fit perfectly for a number of company categories, including start ups, growing firms, and also franchises which make up a huge portion of the borrowing segment of this program. As we have hinted, the program is run at the local level, local meaning wherever your firm is, because the program is underwritten and funded by your local Canadian chartered bank. By the way, one of the challenges of the program, as ironic as it may seem, is to find a banker that understands and supports the program in a positive manner. That means of course facilitating your application and recommending you for approval! A common complaint we hear from clients on anything to do with ' gov programs' or banks in general is that ' forms and documents' are a challenge. Let's be realistic. All business financing requires a forms and app's, and we don’t necessarily subscribe to the fact that SBL loans are any different. Some key basic requirements are a reasonable personal credit history for the busines owner/owners, a business plan and cash flow, and some historical financial statements if you're already in business. Very basic things such as your articles of incorporation are also required. Oh, and by the way, we strongly encourage clients to pay their taxes as you can expect to get a government loan when you owe them for back personal taxes already, right?! The Canadian government business loan funds billions of dollars of small business loans in Canada. It's a working example of Gov. Programs that work. Speak to a trusted, credible and experienced Canadian business financing advisor today on achieving solid finance rates and terms you otherwise could not achieve. Bottom line? Get with the program!! Stan Prokop - founder of 7 Park Avenue Financial – http://www.7parkavenuefinancial.com Originating business financing for Canadian companies , specializing in working capital, cash flow, asset based financing . In business 7 years - has completed in excess of 80 Million $$ of financing for Canadian corporations . Core competancies include receivables financing, asset based lending, working capital, equipment finance, franchise finance and tax credit financing. Info re: Canadian business financing & contact details : http://www.7parkavenuefinancial.com/bank_financing_commercial_business_banking.html

Is Canadian Franchise Financing A Do It Yourself Project? Franchising In Canada With Success

Canada Franchising Opportunities Can Be Your DYI Success Story If Financed Properly ! Information on Canadian franchise financing . Canada franchising opportunities can be financed on your own , with the right strategy and advice. There seems to be a lot of ' DYI ' out there today, that being the acronym for Do It Yourself of course. So we were thinking, is it possible that Canadian franchise financing for the purchase of your chose franchising endeavor in Canada is a ' DYI ' project? Let's talk about a lot you can do on your own, (as part of that ' dyi ‘) and we'll also focus in on some key areas where expert assistance is highly recommended! Our focus is of course on financing that franchise; we're assuming you have already picked your business of choice. A solid first start is to have a realistic discussion with your franchisor around their knowledge and assistance in the area of helping your franchising project in Canada. It's the policy of some franchisors, certainly not all by the way, to develop financing guidelines for their units. This might be in conjunction with a preferred program via a financial institution, or, as importantly, their own experience in levels of investment, capital, and working capital to acquire, run, and of course grow the business. If there is one caveat here we simply say to clients that you should not infer any sort of guarantees that your financing loan or package will be approved simply because a program exists that you might potentially fit into. Our own experience though is that certain financial institutions target many successfully larger franchise chains and will go out of their way in ways we can't mention to get a transaction completed on your behalf. (Think hockey/donuts as an example! enough said!) Getting back to DYI though, a business plan, either prepared by yourself or with input from you is critical. This can easily be accomplished with help from the franchisor, your accountant, or an experienced Canadian business financing expert in the area of franchising in Canada. We forgive clients for thinking they are out of their league in prepared a business plan and cash flow, but it's not as hard as you think. The reality is that if you can help prepare and understand and present a plan your chances of financing approval increase significantly. DYI also can be taken in the context of looking at your own personal investment in the business. Your choices are of course 100% outright cash purchase (not recommended by us), 100% borrowed funds (not recommended, and oh by the way, impossible!), and the real world solution, an investment by yourself with some real world franchise financing for the balance of your purchase. DYI with respect to your owner equity is anywhere from 10- 50% per cent in Canada. Franchisees should spend part of their DYI time in assessing their personal net worth, their liquidity, and how they will raise and contribute their portion to the franchise investment. We've shown that a good part of your Canadian franchise financing journey can in fact be a DYI process. Where you win big time is by using, where necessary the services of a good accountant, franchising lawyer, and an experienced credible and expert Canadian business financing advisor to complete your purchase successfully, under terms that make sense for your situation. Stan Prokop - founder of 7 Park Avenue Financial – http://www.7parkavenuefinancial.com Originating business financing for Canadian companies , specializing in working capital, cash flow, asset based financing . In business 7 years - has completed in excess of 80 Million $$ of financing for Canadian corporations . Core competancies include receivables financing, asset based lending, working capital, equipment finance, franchise finance and tax credit financing. Info re: Canadian business financing & contact details : http://www.7parkavenuefinancial.com/canadian_franchise_financing_canada_franchising.html

Considered An ABL Asset Based Secured Business Line Of Credit ! Is The New Year The Right Time For Your Company?

Looking For A New Way To Master Business Financing?

Information on a secured business line of credit for Canadian business financing . Let an ABL asset based facility solve working capital needs.. differently .



What Canadian business owner or financial manager hasn't wondered if they have properly considered all the financing alternatives available to their firm in today's challenging borrowing market? One mechanism not fully known or understood properly is the secured ABL asset based business line of credit. Is it for your firm? You'll decide shortly!

Although Canadian commercial bankers still proudly trumpet the fact that chartered bank commercial credit facilities are widely available hundreds or thousands of businesses in Canada are unable to meet the qualifications for such financing. Basic qualifications for a bank credit facility that margins receivables (and hopefully inventory) are not complicated to understand. They are of course difficult to achieve or provide! They include clean balance sheets, income statements that show profitability, and positive cash flows, both historical and current. Oh and by the way, owners must often back stop these facilities with guarantees that often require personal assets to be either pledged, or collateralized.

Don't get us wrong. Bank financing in Canada is available, it’s cost effective, it’s simply just a bit harder to get if you can't qualify under out criteria we set out above.

So, enter the secured ABL facility. Here's business working capital and cash flow financing with an emphasis on only one word: ' Assets'! The ABL lender is focused. That focus? Your key business assets of receivables, inventory, unencumbered fixed assets. You borrow against the total current market value of these assets via a revolving secured business credit facility. If there is a bottom line it’s a simple one - a focus on collateral, not ratios, covenants, or outside collateral.

A common question from clients revolves around what dollar level of facilities is either the entry point or the cap on such secured facilities. The good news is that there is no upper limit on ABL deals in Canada. In fact, unbeknownst to many some of Canada's largest companies utilize ABL facilities, having forsaken bank facilities which no longer make sense for their business.

We consider a solid entry point for such facilities to be in the 250k range, which more often than not is a combination of receivables and inventory. We hasten to add that there must be a reasonable mix as typically A/R has a higher borrowing value. However, there is always an exception to the rule, so a good example of a great ABL solution is the financing of inventory for retail chains, etc.

Pricing on secured ABL facilities fluctuates widely in Canada. Pricing can be either below bank comparables, slightly higher, than or as high as 1.5-2% per month depending on whom you choose to deal with. Mid market firms who have assets are great candidates for this type of business financing,

A proper submission for an ABL facility should include financials, proper aged payables, receivables and inventory, as well as miscellaneous information you would associate with any type of business finance application.

So why consider an alternate method of financing in the New Year? It's about increased borrowing power, easier qualifications, and competitive pricing commensurate with your overall credit and asset quality. Speak to a trusted credible and experienced Canadian business financing advisor on reasons to make a change in your finance strategy.





Stan Prokop - founder of 7 Park Avenue Financial –


http://www.7parkavenuefinancial.com


Originating business financing for Canadian companies , specializing in working capital, cash flow, asset based financing . In business 7 years - has completed in excess of 80 Million $$ of financing for Canadian corporations . Core competancies include receivables financing, asset based lending, working capital, equipment finance, franchise finance and tax credit financing.
Info re: Canadian business financing & contact details :

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

How To Avoid Business Operating Cash Flow Problems And Improve Financing Success

Note From The Trenches – Working Capital Traps To Avoid


Information on operating business cash flow and solutions on how to improve business financing problems and challenges .




Many Canadian business owners and financial managers find out the hard way that business success is almost always also tied to having, and improving their operating cash flow. It's when sales and profits don't match cash and working capital that the problem begins. Bottom line, getting rich on paper only is not all that fun!

In order to avoid cash flow problems we can quite simply say that it’s a ' matter of time '. When we say ' time ' we mean it in the context of how your firm operates, in essence it's operating cycle. Many new or inexperienced business owners often find out painfully that the cycle of time from getting an order to collecting the sale can be significant!

In a perfect world, (and we know it's not) your business wants to have the flexibility to allow your business bank account to fluctuate in a constant manner, from surpluses to positive balances.

One fallacy often missed by the entrepreneur is that deficit cash flows are a sign of weakness. In reality, if you are selling, and growing, it’s simply a case of the ' timing ' we have spoken of. You have built up an investment in receivables and inventories, and are waiting to get paid, converting those into operating business cash flow.

But, if you don’t fail to recognize and manage how to improve asset management business cash flow problems occur. It's at these times that your bank or other lenders you might be dealing with may attempt to rein in your business, in essence cutting off future working capital requirements.

One of the most obvious ways to effectively manage your cash cycle is to ensure you have a Canadian chartered bank operating line of credit. This facility in effect is in a position to totally manage your time horizon when it comes to getting an order, shipping or delivering a product or service, and then waiting 30... 60... well... you know what we are talking about!

Many businesses , particularly those that are either small, or start up in nature quite frankly don't qualify for business cash flow lines of credit in the manner that they might wish . Can this challenge be solved?

Yes, it can. In order to improve your cash position you can do one of two things. First, you can manage more effectively, and secondly you can access alternative financing vehicles.

Are we saying you can actually fix your own problems via management? Absolutely. You can tighten terms and credit policies, take discounts when available, and enforce stricter collections from clients. For whatever reason many clients we talk to can't or are reluctant to manage as above. We'll never know why.

The solution then? Enter alternative financing . By using such methods as receivable financing outside the bank, inventory financing, merchant advances, tax credit monetization, etc you can still be successful .

In fact some of these financing vehicles, even if more costly can make your business more successful if properly managed . For instance you can incrase sales by providing longer payment terms to clients, something your competitor might not be able to do . Additionally you could take trade discounts with the funds you receive from receivable financing, increasing profits if the discount is more than the cost of financing .

Tuition is often high in the school of business operating cash flow . Mistakes can be costly if you dont take measures to improve and recognize cash flow problems. Speak to a trusted, credible and experienced Canadian business financing advisor on business cash flow challenges that can be fixed .. properly.






Stan Prokop - founder of 7 Park Avenue Financial –


http://www.7parkavenuefinancial.com


Originating business financing for Canadian companies , specializing in working capital, cash flow, asset based financing . In business 7 years - has completed in excess of 80 Million $$ of financing for Canadian corporations . Core competancies include receivables financing, asset based lending, working capital, equipment finance, franchise finance and tax credit financing.
Info re: Canadian business financing & contact details :


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

An Equipment Loan Might Not Be What You Think! Kick Starting Asset Financing Success With Canadian Leasing Companies

You’re One Step Away From The Benefits Of Lease Financing Approval


Information on effective strategies to deal with leasing companies in Canada. Equipment loan and asset finance tips for financing success





Unfortunately a huge number of Canadian business owners devote a huge part of their time in business life to asset finance; in effect trying to find capital for their business. Many times the solution to that challenge is with leasing companies in Canada ready and willing to provide those business people with equipment loan and lease financing.

What then are some of the key issues that get you one step away from business financing success when it comes to acquiring assets for your firm? As a business owner or financial manager you want to get the amount of capital you need with the least amount of risk you are willing to take on via debt.

Leasing companies, via asset finance in Canada are one of essentially five ways to raise capital for assets. (Those other four are of course supplier loans, bank financing, term loans, or equity injections from owners).

Why then do 80% of business owners in North America constantly utilizing lease finance as a business strategy, instead of simply buying the assets? Flexibility is one reason, your assets can be financed on shorter terms , via a ' lease to use ' type strategy, or longer amortizations via a lease to own transaction .Depending on which of the two you choose you again ( and here's our flexibility again ) can either return the asset or take ownership of it .

Canadian accounting practice sets up specific rules that deal with different types of lease strategies , either recording the lease on your ' books ' or in some cases, via an operating lease setting your transaction up as an expense . As boring as it might seem to spend some time on lease accounting implications the right choices in this area can save you a lot of dollars, and grief ! .. when it comes to financial reporting, tax time, etc.

Clients seem to slowly get the point here, in that your lease management becomes part of your overall business strategy, and takes some planning. It’s a good vehicle for getting some communications between the users of assets in your company as well as the finance side of the business!

In that manner we ' preach' to clients that lease arrangements are driven from several areas of management thinking:

The ability to borrow

The convenience provided by leasing companies

Risk avoidance in asset ownership via an equipment loan

Tax and accounting implications/benefits


One of the most powerful examples of risk avoidance in asset ownership via assistance from Canadian lease companies is the area of technology and computer financing. Who in their right mind, asks the business owner, wants to take on the risk of technology obsolescence in the area of computing, which seems to change every 5 minutes, including the newest grey area of computing, ' THE CLOUD '.

Does an equipment loan or lease have a lower or higher cost? That’s a typical question from many clients who are at the crossroads of the lease vs. buy decision. This is where your finance folks or accountants take variables into effect such as your firms cost of borrowing, the rate in the lease , and hopefully always making every aspect of their comparison an ' apples to apples ' assessment .

Other factors in the lease vs. buy decision might include down payment scenarios, credit covenants with current lenders, depreciation policies, residual value of the asset at the end of the lease or loan, etc!

As we have shown, an equipment loan or lease might not always be as simple a consideration as you might think. But it continues to be the financing of choice, everyday, for thousands of Canadian businesses. Speak to a trusted, credible and experienced Canadian business financing advisor today about getting on track with Canadian leasing companies for asset finance.





Stan Prokop - founder of 7 Park Avenue Financial –


http://www.7parkavenuefinancial.com


Originating business financing for Canadian companies , specializing in working capital, cash flow, asset based financing . In business 7 years - has completed in excess of 80 Million $$ of financing for Canadian corporations . Core competancies include receivables financing, asset based lending, working capital, equipment finance, franchise finance and tax credit financing.
Info re: Canadian business financing & contact details :


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

Why Canadian Business Is Turning To Accounts Receivable Financing Via A Factoring Company For Survival And Growth

Balance the Cost and Benefits Of A/R Finance In Canada


Information on accounts receivable financing in Canada . How to determine the benefits and cost of using a factoring company for working capital.





Small and medium sized businesses in Canada are almost always facing a financial challenge with it comes to funding to both grow, and yes even survive. However unfortunate, the reality is that thousands of firms have somewhat limited options to meet the funding challenges of their business.

Is there a solution? The answer, simply, yes. One of those solutions is accounts receivable financing via a factoring company or invoice discounting firm.

So why do those thousands of firms consider a/r financing as an alternative to term loans , or even the costliest method of financing, giving up part of your owner equity . Simply because they are in a position, with the right knowledge, to utilize, rather... monetize one of the largest, if not the largest asset on the left hand side of their balance sheet , their receivables.

A/R financing simply speeds up cash flow and allows you to finance growth by monetizing your receivable portfolio, in whole or in part. The process itself is simple; it’s who you partner with and how you structure your A/R financing (and what you pay for it!) that becomes somewhat of a challenge for Canadian business owners and financial managers.

In Canada two types of working capital finance via invoice finance are available. Under the most common scenario you ' sell ' your invoices to your factoring company - they advance you the cash, pretty well the same day, and they begin a process to collect that receivable as it becomes due from your client.

The other alternative, less common but our absolute recommended solution is that same sale of your receivables, but with you doing all the billing and collecting. In both circumstances there is essentially no limit on the amount of financing you can attain - naturally you have to have the sales to support that financing, but more often than not with most clients we talk to sales isn’t the problem, financing is !

If we had to say what confuses, or concerns the majority of first time clients in accounts receivable pricing we would have to put it down to two issues, the cost, and the daily mechanics of this financing vehicle.

So what's the best way to both understand and justify the cost of A/R finance? This is where the ' rubber hits the road' so to speak. The best way we can explain it to a client is that you have to look at the cost of this working capital from a couple different angles. One is that you are already carrying accounts receivable, so you have a cost. If the clients are low margin profits to you and taking a long time to pay that cost is significant, often as much or more than the cost of A/R finance.

The other way to look at it is that there is a large value to cash in the ongoing operations of your firm. You can maintain solid relations with suppliers and vendors by paying them promptly, taking advantage of discounts, as well as capitalizing on the buying power of your new found cash. A typical discount on, say, a 100k invoice in Canada is $ 2,000. Simply speaking, it has cost you $2000, on a 30 day basis to receive $98,000 for your invoice. But, consider this, take that 98k now and negotiate better pricing of say 3% less on your vendor purchases, and pay your vendor on delivery or via a 2% prompt payment discount. That combination strategy has saved you 5%, plus, you're ' liquid'. Talk about a winning strategy.

The time it takes your clients to pay, as well as your monthly volumes ultimately dictate your pricing in accounts receivable financing in Canada.

As we said the benefits of utilizing a factoring company are quite clear. Unfortunately in Canada the method in which fees and benefits are presented often lack clarity to the first time A/R finance user. Want clarity on pricing and benefits of accounts receivable financing in Canada? Consider talking to a trusted, credible end experienced Canadian business financing advisor for info on this innovative working capital vehicle.







Stan Prokop - founder of 7 Park Avenue Financial –




http://www.7parkavenuefinancial.com


Originating business financing for Canadian companies , specializing in working capital, cash flow, asset based financing . In business 7 years - has completed in excess of 80 Million $$ of financing for Canadian corporations . Core competancies include receivables financing, asset based lending, working capital, equipment finance, franchise finance and tax credit financing.
Info re: Canadian business financing & contact details :


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