Why Confidential Factoring Discounting Is Your Secret Cash Flow For Business Weapon!

In terms of a secret weapon in business one assumes if you had this one you would have a competitive advantage? And that’s what we think confidential factoring discounting will deliver once you understand why it might just be a solid alternative for cash flow for business in Canada.

We're talking about regular and special here. Regular factoring or invoice discounting or receivable financing (all these terms are interchangeable) is the financing of your receivables for instant cash flow and working capital,

This type of financing is becoming more commonplace everyday. When we talk to clients about what they perceive the financing to deliver on the two most common issues they bring up are that they don’t really like how it works on a day to day basis, and secondly, the cost factor seems to always come up.

We think we can dispel both of those issues when it comes to providing a better alternative to address both concerns and misconceptions that our clients have.

We need to step back a bit though and first understand what this type of factoring discounting is, and why the current ' vanilla ' offering in Canada doesn’t work for clients.

At its core the facility is simply ' monetizing ' (a fancy word for ' turning into cash’) your receivables for immediate cash. Your ability to collect your receivables faster creates cash flow and eliminates a lot of business stress! If you have the ability to obtain conventional bank financing naturally you probably would be financing your receivables through the bank - yet in the current economic environment bank credit is more difficult to achieve, and, to make matters worse in many circumstances we see the amount of credit you can get from a commercial bank in Canada is simply not enough for your needs. That’s where the working capital challenge sets in.

So, ' regular ' factoring for cash flow for business works as follows - you generate an invoice, you sell the invoice and receive cash, usually the same day. Sounds great so far right. However, now what happens is that your customer is contacted by the factor firm and they verify the invoice and receipt of goods and services. They also are in collection mode directly with your clients, according to whatever your terms are. The cost of this type of financing in Canada ranges anywhere from 7-8% per annum to 1-3% per month. Factors determining prices are your firm’s general financial profile, the size of the facility you need, and the types of customers and industries you sell into.

So that’s ' regular ' and we can here our clients now saying this sounds kind of ok , but the customer intrusion level is highly undesirable .

That’s where confidential factoring discounting comes in. Here's the kicker. You bill and collect your own invoices! You have now regained total control of your factoring facility, are achieving all the benefits, and it is you who decides what amount you wish to finance on a daily, weekly or monthly basis. And whats more ' special' is simply the fact that the costs of confidential factoring discounting are essentially the same. We also spend a lot of time with clients showing them how they can offset a huge part of the cost of this type of financing via some time worn cash management strategies .

One or two caveats are that the facility should generally involve a receivables portfolio size of at lease 250k, and you have to be able to demonstrate solid operations regarding maintaining updated financials, billing cleanly and properly, and posting payments to the ledger properly.

Not everyone in Canada knows or is aware of this type of financing. Speak to a trusted, credible and experienced business financing advisor as to how this type of financing gives you a major competitive edge over firms using the ' regular' version!

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Stan Prokop - founder of 7 Park Avenue Financial -

http://www.7parkavenuefinancial.com
Originating business financing for Canadian companies , specializing in working capital, cash flow, asset based financing . In business 6 years - has completed in excess of 50 Million $$ of financing for Canadian corporations .Info re: Canadian business financing & contact details :


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

Why You Need Film Tax Credits and Why the Canada Film Tax Credit System Works For Your Project

If they are offering, why aren’t you taking? That's what we ask clients when they bring us questions on film tax credits, how the Canada film tax credit system works, and , most importantly, how can they get their share!

You can call it of course anything you want, an incentive, a non repayable grant/credit, but the bottom line is that Canada has proven itself very serious in the introduction of very healthy tax credits that are non repayable and can form a significant part of your overall film, tv and animation credit financing strategy .

Ours is not to question why... but its pretty clear Canada is serious about stimulating and growing the Film, video and animation industries. The latter, animation is slowly gaining more traction everyday. Naturally job creation and tax and revenue generation from these projects is probably high on the list of ' why' for the government, but again, we want our clients to take advantage of the program, not to debate it!

The credits themselves come out of the government’s tax policy and while they used to be viewed as cumbersome the process has been significantly streamlined over the years, and the overall generosity of the program has continually been increased.

The tax credit is clearly a financial incentive, but at the end of the day we find out clients aren’t viewing it as much as an incentive as in fact a key part of their overall financing strategy. It's necessary to step back and understand the key components of a project financing and why film tax credits have clearly gone straight to the top of the pile as a ' must have ' relative to your overall project financing .

Depending on where you shoot, product, or post produce your project the credits can be anywhere from 25- 45% as a general range. (It varies by project and by genre of project - i.e. Film vs. animation, etc).

The Canada film tax credit provides you with a certificate which is then monetized by the government in the form of a non repayable cheque. Naturally in a perfect world you would arrange your debt and equity financing for your project, calculate your tax credit on the project and then consider yourself fully financed. The tax credit cheque would come from Ottawa after you have filed for it along with the tax filings you have submitted for the specific legal entity project.

But, alas, it’s not a perfect world apparently, and boy could your independent project utilize those funds sooner rather than later. That’s where film tax credits, when financed, can bring valuable cash flow and working capital to your project. When properly financed with the right partner finance firm your credits can greatly assist in the cash flowing of your project, providing valuable working capital during production. We read one article recently that referred to your overall project financing as a ' toolkit ' with a number of potential financing tools inside. Clearly the Canadian film tax credit is one of those tools!

The logistics around the financing of your tax credit can be as simple or as complicated as you make them. Our clients choose simple, so they surround themselves with a good media accountant and legal advisor, they have a finance budget and strategy in place, and they borrow against that eligible tax credit. With the right team around you, you can specifically identify exactly how much you will receive and what amount can be financed.

So , bottom line, call it a subsidy, call it a grant, call it a tax credit, call it anything you want, but utilize the Canada film tax credit as a key role in your independent film, tv or animation strategy . Speak to a trusted, credible, and, oh yes, experienced Canadian business financing advisor who can assist you to prepare and monetize your claim.
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Stan Prokop - founder of 7 Park Avenue Financial -

http://www.7parkavenuefinancial.com

Originating business financing for Canadian companies , specializing in working capital, cash flow, asset based financing . In business 6 years - has completed in excess of 50 Million $$ of financing for Canadian corporations .Info re: Canadian business financing & contact details :

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

Great Reasons to take your sr ed claim and access sred financing via specialize sred funding Canada Programs

Gimme a reason .That’s what clients often ask when we talk to them about the benefits of both filing a sr&ed claim, and then considering sred financing as a cash flow strategy around sred funding in Canada for cash flow and working capital .

You want reasons, and we have reasons for you to consider...Businesses of all size in Canada utilize the sr&Ed program in Canada to be eligible to receive a huge portion of their expenses in R&D via a non repayable tax credit.

When we tell clients they can utilize a sred financing strategy to increase cash flow and working capital via the r&d credit, well, frankly, they almost cant believe it .

There isn’t a day when the government isn’t issues cheques for millions of dollars on the Scientific Research and Experimental Development (aka " sred!) Program, so let’s all agree that you are eligible for your share. And if you're working on processes and products and re design in your industry then the salaries, products and equipment and even some overheads are taken into account when you file a sred claim.

The sr&Ed claim process is all tied into Canada Revenue Agency. They receive your claim and process it at the same time you file you year end tax return. If you are ok with ' waiting’... and most of our clients are not, you will get a significant cheque back from Ottawa in a number of months.

Clients are always asking us how long they have to wait for a refund, and if there is any way to speed up the process. Far be it from us to be the ones to be telling someone from the government to speed up the process. But what we do advise clients to consider is to finance their sred funding credit as soon as they file it.

Why would you want to finance a tax credit? There are only two reasons, cash flow and working capital now! By monetizing your tax credit you are in a position to take the government rebate and put it to positive use within your company. And what are those positive uses? It's the basics, reduce your payables, buy new equipment, re invest in your entire sr&ed claim process to increase your competitive advantage...and on it goes, basically use those funds for any worthwhile purpose .

How long does it take to finance a claim and whats involved? That's not an untypical question. In our experience claims are financed within two to three weeks. And could the process be any more simple - its all about completing a simple business financing application, utilizing your sred claim as collateral, and undergoing any normal due diligence . Claims of any size can be financed, it typically makes sense to finance claims that are in excess of 130k... but smaller claims can be monetized also.

Speak to a trusted, credible and experienced Canadian business financing advisor around sred funding Canada claims. And use that cash flow which you have achieved in a timely fashion to grow your sales and profits.

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Stan Prokop - founder of 7 Park Avenue Financial -

http://www.7parkavenuefinancial.com


Originating business financing for Canadian companies , specializing in working capital, cash flow, asset based financing . In business 6 years - has completed in excess of 50 Million $$ of financing for Canadian corporations .Info re: Canadian business financing & contact details :

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


We finance the little guy .
P.S. We finance the big guys also!

Don’t Make Mistakes When Searching For Franchise Finance Lenders When You Buy A Franchise In Canada

Business folks often refer to the term ' key to success ‘as part of their business plans. Certainly the key to success when you buy a franchise is to finance it on time, and properly; we tell clients you don’t get a lot of chances to make mistakes when you are working with franchise finance lenders!

The concept of financing your franchise is a broad one... it might be one single loan or a couple different finance strategies to get you to the goal line, which is of course acquirng and owning your own business under a franchise umbrella... in effect the Canadian dream .

Try and try again generally doesn’t work in franchise finance - you more or less, in our opinion, get one chance to do it right . That therefore involves getting all your ' ducks' lined up properly and working with an experienced Canadian business financing franchise advisor, or if you prefer, yourself and the lender directly.

As we said, making mistakes in business finance is not where you want to be - so plan, do it right, and do it once. Let's examine some of those underpinning you need to be successful and avoid those errors.

In general some of those cornerstones are decent personal credit history (more about that in a minute - as we can hear our clients already " what's decent?!), a down payment that makes sense. and a financial plan that demonstrates your ambition to be successful .

This latter point is usually covered off in a business plan. We can’t ever imagine buying a business without a plan, and humbly submit that if you don’t have a plan you are primed to fail - and that’s not a good thing when you have your own funds at stake.

Can you buy a franchise in Canada, and finance it without a good personal credit history. We tell clients the sad truth is that it is difficult, if not impossible, to do that successfully. That’s because franchise finance lenders view your business as both a start up and a small business, and they relate those two terms directly to how you manage your own personal finances as the owner. To put is very simply, the lender is saying ' if this man or woman isn’t paying Visa then why should I think they are going to pay us....’ In Canada the credit bureau system is based on a score to 800 and you need a certain specific number to qualify for franchise financing. Speak to a trusted, credible and experienced business financing advisor as to how you can manage and work through that process.

You probably have spent a large part of your life dreaming about crafting a great business plan, opening balance sheets, 3 years of projected cash flows... loan amortizations, etc. Uh... we're beign a bit sarcastic of course!! But the reality is you need a solid business plan to demonstrate how you will be successful. It’s a great document for benchmarking down the road even how you are doing against your plan.

In Canada the majority of franchises are financed and subsidized so to speak by a special federal program called the BIL program. Don’t make a mistake in not understanding what the qualifications are, and work with an expert if you don’t feel you are comfortable in navigating the finance maze.

So, is financing the key to Success when you buy a franchise in Canada. We'll let you be the judge... but if you are on the side of our opinions plan, and work with an expert , do it right, and avoid mistakes that will jeopardize closing the transaction .

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Stan Prokop - founder of 7 Park Avenue Financial -

http://www.7parkavenuefinancial.com

Originating business financing for Canadian companies , specializing in working capital, cash flow, asset based financing . In business 6 years - has completed in excess of 50 Million $$ of financing for Canadian corporations .Info re: Canadian business financing & contact details :

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

The Dirty Little Secret Your Banker Won’t Tell You About Asset Based Lending and Asset Finance

Can you blame someone for not telling you about a good thing? Especially when that thing is better than their thing! No surprise then that asset based lending is the dirty little secret in asset finance that that bankers in Canada don’t want to let you know.

We hate to burst their bubble... but what the heck; we'll share that secret with you and touch on why it’s such a powerful non bank financing strategy.

To understand why an asset based lending solution is so different we need to understand what we are comparing it against. The comparison is of course an operating line of credit with a Canadian chartered bank. They are great, low cost, and run smoothly on a daily basis. If... and we repeat if... you can get one and get it increased as you need it.

Your ability to access a business line of credit with the bank focuses in on everything you probably feel isn’t necessary. You have assets; you have growth, so whats the problem. The chartered banks, in their wisdom allocate these lines of credit based on yes... the assets... but as importantly ratios, covenants, personal guaranteees and outside collateral. By the way, we think they do a great job of that... mainly because they are lending you my money which is on deposit at their bank. So all power to safe lending practices, and that’s why Canadian banks are some of the strongest in the world.

That’s all great say our clients, except it does nothing for us when you want to access business credit. That’s brings us to our secret - asset based lending in Canada and why this type of asset finance is a powerful working strategy. And could it be simpler. Not really. It focuses on the two things you have always had... assets and growth potential for sales and profits.

Asset based lending is the ability of your firm to borrow, daily, as you need it , against receivables, inventory, as well as equipment and real estate if they factor into the picture .

It supports you credit needs, and does not, we repeat , does not revolve around those other requirements the banks have, i.e. rations, covenants, emphasis on personal net worth, outside collateral , etc.

Want to know an even more surprising secret. Some of the Canadian banks actually have small boutique divisions of asset based lending. In our experience these divisions don’t communicate properly with regular commercial bank divisions around what their offering is.

So who actually offers this type of asset based lending. In Canada it’s a relatively small handful of firms, some of which are U.S. based, and who have a tremendous expertise on the things you already have, inventory, receivables, and purchase orders and contracts.

Asset finance can cost the same as the chartered bank offering, in ,many cases it costs a bit or a lot more, depending on the size of your transaction .A business line of credit via an asset based line of credit generally starts at 250k and goes up to anywhere up to 50 Million or more!.

Accessing and navigating the maze of this boutique financing is difficult for the Canadian business owner and financial manager. Speak to a trusted, credible and experienced Canadian business financing advisor on why asset based lending is the secret you want to know more about. And why the heck didn’t your banker tell you about it sooner!
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Stan Prokop - founder of 7 Park Avenue Financial -

http://www.7parkavenuefinancial.com

Originating business financing for Canadian companies , specializing in working capital, cash flow, asset based financing . In business 6 years - has completed in excess of 50 Million $$ of financing for Canadian corporations .Info re: Canadian business financing & contact details :

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

Working Capital and Business Lending in Canada Without the Voodoo!

The other day one of the major U.S. banks released a report around the current ' optimism ' in small and medium sized businesses. God knows we love a good survey about what our competition is thinking!

It's tougher than ever to read through some of the smoke and mirrors, dare we call it voodoo? .. and get a sense of where working capital and business lending is at here in Canada. We're going to do that for you. More importantly we'll give you real world solutions to cash flow challenges.

Optimistic? You may or may not be bullish about your business as many of our clients are still slowly coming out of the recent recession, and from a cash flow and working capital perspective you're more or less hanging on for your life.

If you are forecasting and planning your cash flow needs, say on a 12 month basis your biggest challenge is often how you do get that liquidity squeezed out of receivables, inventory, and purchase orders and contracts. That has been and still is the real challenge.

When looking at your cash flow and financing needs you need to focus in on several key issues and determine how they fit together - typically those issues your ability to collect your receivables and how you are financing them, what your sale growth is going to be, and what type of longer term capital do you need for things like equipment, real estate, etc. Naturally all that has to be benchmarked against how you are currently financing your company.

The U.S. survey we talked about probably mirrors Canada quite a bit... 25% of firms are going to spne on euqipment... most felt cash flow from customers would imporove , and that sales growth and hiring would again resume an uptrend .

As a Canadian business owner you read these types of surveys, see the business news, and yet at the same time still feel a sense of smoke and mirrors, mostly around the fact that working capital and business lending still don’t seem achievable to the extent you want them to be .

You want solutions to your cash flow challenges in working capital. Let's leave the surveys to the pundits and your competition. You want to get back to growing our business and now worrying about working capital pretty well every day.

There are great solutions for working capital via creative business lending in Canada. When we meet with clients they typically are looking for one solution, the ' holy grail' so to speak. In reality we show them that a number of solutions, possibly combined, can get you where you want to be in Canadian business financing.

Those solutions include receivable financing. Heard about factoring but not sure you like how it works... then consider confidential invoice financing... allowng you to bill and collect your own receivables .

Looking at new equipment while at the same time conserving working capital. Want a 5.5% rate and no full owner personal guarantee... consider the government BIL /CSBF loan... great rates, terms and structures .

Have contracts upcoming, worried about financing them. Talk to an expert on purchase order and inventory financing... despite the myth it really is available!

And finally, consider an asset based lending facility... it combines the power of receivales, inventory and equipment... with your firm borrowing against those assets on a daily basis as you need the working capital .

Is business lending dead in Canada. Is it all just voodoo? We don’t think so. You have solutions, investigate them and speak to a trusted credible and experienced Canadian business financing advisor about getting your business on track!

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Stan Prokop - founder of 7 Park Avenue Financial -

http://www.7parkavenuefinancial.com

Originating business financing for Canadian companies , specializing in working capital, cash flow, asset based financing . In business 6 years - has completed in excess of 50 Million $$ of financing for Canadian corporations .Info re: Canadian business financing & contact details :

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

What Mom Didn't Tell You About Leasing Equipment For Business And Lease Finance Options

And you thought you knew it all! Did you ever think that leasing equipment for business was a straightforward process... you almost couldn’t go wrong? In reality your lease options and who you deal with in this area can make or break good or bad financing decisions.

We’re going to cover some lease basics for you, and we'll let you in on some inside secrets to the trade. We have often told our clients we're not impressed by the ways in which some industry participants create a smoke and mirrors scenario around some of your most important lease financing acquisitions.

We think they are wrong, but most of the time our clients are only focused on rate. That's not a good thing necessarily, because in reality pure math analysis will more often than not show that leasing is a bit more expensive option. The actual reasons you chose to lease probably should be more focused around the two types of leases available, and which one is right for your firm.

Alternate decisions to lease are driven by, guess what...? Credit approval (leasing approval is easier to obtain) and the managing of your payments in a predictable fashion related to your cash flow. An if you are in a technology business you're most concerned with the fact that you have 3 or 5 years to go on payments and your asset is depreciating, or become obsolescent a lot faster.

Don’t forget also that many small, what we can call ' service features ' come with the lease facility. They include the ability to include taxes on your payments, bundle in warranty and maintenance, etc.

Is it possible to figure out the exact rate you are being charged in a lease? As we said, it shouldn’t always be about rate, but the answer is ' yes’... you can figure out what the interest rate is.

How do we do that then? Relatively simple, if you have the tool. The parts of any lease calculation are term of lease, amount financed, the final obligation or future value, the interest rate, and the payment. If you know any four of those you can use a financial calculator to calculate the 'real' rate the lessor is using. For example, you are leasing 50,000$ for 3 years and you own the equipment at month 36 you are told, and the monthly payment is 1600.00$. By entering those 4 into a financial calculator (a real financial calculator) you can see that the rate is 10%.

Let's stay with our client’s fixation on rate. Is that 10% high, low, acceptable, competitive? More often than not it’s a competitive number because the entire industry has to stay competitive to be in business. A better question you never asked is what rate your lease company borrows at in order to allow leasing equipment for business such as yours. If they can borrow at 5% they are making 5% on you... if their cost to borrow is higher... and in most cases it’s higher than you think, they are making less.

Let's share another of those secret strategies not commonly known. Your firm has a lease... it’s for 50,000, for three years, and the monthly payment is 1600.00 and you. Our firm has the same lease, but our monthly payment is 1480$. How could that be, ask clients. Or they will bring us two quotes for the same asset with those same differing payments. The answer is that one lease is an operating lease, structured as a rental, and the lower payment simply means the lessor is going to get the equipment back at the end of the lease - sell it, and recover the shortfall (hopefully) on the lower payment you have been making.

So... is it all smoke and mirrors when it comes to lease finance options. It doesn’t have to be. Does your homework, compare apples to apples, and speak to a trusted, credible and experienced Canadian business financing advisor in the lease financing area.
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Stan Prokop - founder of 7 Park Avenue Financial -

http://www.7parkavenuefinancial.com

Originating business financing for Canadian companies , specializing in working capital, cash flow, asset based financing . In business 6 years - has completed in excess of 50 Million $$ of financing for Canadian corporations .Info re: Canadian business financing & contact details :

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