It's time. We're talking about purchase order finance in Canada, how P O finance works, and how financing inventory and contracts under those purchase orders really works in Canada. And yes, as we said, its time... to get creative with your financing challenges, and we'll demonstrate how.
And as a starter, being second never really counts, so Canadian business needs to be aware that your competitors are utilizing creative financing and inventory options for the growth and sales and profits, so why shouldn’t your firm?
Canadian business owners and financial managers know that you can have all the new orders and contracts in the world, but if you can’t finance them properly then you're generally fighting a losing battle to your competitors.
The reason purchase order financing is rising in popularity generally stems from the fact that traditional financing via Canadian banks for inventory and purchase orders is exceptionally, in our opinion, difficult to finance. Where the banks say no is where purchase order financing begins!
It's important for us to clarify to clients that P O finance is a general concept that might in fact include the financing of the order or contract, the inventory that might be required to fulfill the contract, and the receivable that is generated out of that sale. So it’s clearly an all encompassing strategy.
The additional beauty of P O finance is simply that it gets creative, unlike many traditional types of financing that are routine and formulaic.
It’s all about sitting down with your P O financing partner and discussing how unique your particular needs are. Typically when we sit down with clients this type of financing revolves around the requirements of the supplier, as well as your firm’s customer, and how both of these requirements can be met with timelines and financial guidelines that make sense for all parties.
The key elements of a successful P O finance transaction are a solid non cancelable order, a qualified customer from a credit worth perspective, and specific identification around who pays who and when . It's as simple as that.
So how does all this work, asks our clients .Lets keep it simple so we can clearly demonstrate the power of this type of financing. Your firm receives an order. The P O financing firm pays your supplier via a cash or letter of credit - with your firm then receiving the goods and fulfilling the order and contract. The P O finance firm takes title to the rights in the purchase order, the inventory they have purchased on your behalf, and the receivable that is generated out of the sale. It's as simple as that. When you customer pays per the terms of your contract with them the transaction is closed and the purchase order finance firm is paid in full, less their financing charge which is typically in the 2.5-3% per month range in Canada .
In certain cases financing inventory can be arranged purely on a separate basis, but as we have noted, the total sale cycle often relies on the order, the inventory and the receivable being collateralized to make this financing work.
Speak to a credible, trusted and experienced Canadian business financing advisor as to how this type of financing can benefit your firm.
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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/p_o_purchase_order_finance_financing_inventory.html
Our blog highlights Canadian Business Financing solutions via receivable finance , equipment finance, working capital financing, asset based lending, business acquisition financing,franchise finance, and tax credit monetization via SRED and Film Tax Credits. Our goal is to educate and assist Canadian businesses with their financing needs. You Are Looking For Canadian Business Financing! Welcome to 7 Park Avenue Financial Call Now ! - Direct Line - 416 319 5769
Sunday, December 26, 2010
Film Finance via independent film funding and the Canadian Film Tax Credit
Getting your film funding in place. It seemed like a short project and challenge at the time! However most independent film finance becomes somewhat of a journey, and that’s of course an understatement. But the Canadian film tax credit can help you play a huge role in pulling the financing for your project together.
Call it a challenge, call it , as some have, ' tricky' or call it skill, but the monetary part of your film , tv or digital animation project becomes a huge part of the producer and owners direct efforts for successful completion of any project .
We are often amazed at how little it takes, in funding, to complete a professional project in any of our 3 entertainment genres (film, television, and digital animation). Yet even smaller budgets have huge financing challenges when you don’t have the financial backing of a major studio. Therefore your total costs of securing rights, paying actors, and actually producing the project often requires a long timeline.
Enter, at stage left, the Canadian tax credit. This is clearly the savior of many a production that is domiciled in Canada, often paying for 30- 40%, and more of a total production. We certainly not saying the rest of your financing becomes a 'cake walk ' , as the expression goes, but our clients routinely maintain that the additional equity, debt, and co production and distribution agreements are much easier to put in place when you utilize the Canadian tax credit .
Naturally the more film funding you can rise via the film tax credit in Canada, as well as debt you can arrange simply means that you are not diluting your ownership position and therefore positioning you well for any financial success on your project.
Its all about partners in business today, and film finance is no exception. By partnering financially, in the right manner, with either co production agreements or Canadian film tax incentives you are able to maintain proper ownership of your project, and that’s of course what it is all about.
Let’s circle back to the Canadian film tax credit. The credits have become increasingly more generous over the years, and apply to all Canadian provinces where you might choose to shoot, film or product your project - depending on your genre again. By properly budgeting your project in a realistic manner an experienced Canadian film financing consultant can assist you in determining the exact amount of dollar eligibility for your tax credit. The tax credit becomes a part of your financial statement filings for the specific legal entity you have created for your project.
You can then finance the credit, which is a non repayable grant/credit from the government. Naturally you can simply wait for the credit, the ' cheque is in the mail ' so the saying goes, but many of our clients choose to finance the credit as soon as they have it certified. Receiving this funding in advance often creates a huge and positive working capital injection that actually helps finance of course the cost of the film. The tax credit is in essence the collateral for the bridge loan you arrange for the film tax credit itself.
Financing and film funding utilizing your Canadian film tax credit can be accomplished in a manner of weeks, and its all about having a budget, a tax credit calculation, and a firm finance plan that identifies the other parts of your project as complete .
Speak to a trusted, credible and experienced Canadian film tax credit financing advisor as to how you can maximize your return on investment for your owners and lenders via the film tax credit in Canada. It's a cash flow 101 great 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 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_funding_film_finance_film_tax.html
Call it a challenge, call it , as some have, ' tricky' or call it skill, but the monetary part of your film , tv or digital animation project becomes a huge part of the producer and owners direct efforts for successful completion of any project .
We are often amazed at how little it takes, in funding, to complete a professional project in any of our 3 entertainment genres (film, television, and digital animation). Yet even smaller budgets have huge financing challenges when you don’t have the financial backing of a major studio. Therefore your total costs of securing rights, paying actors, and actually producing the project often requires a long timeline.
Enter, at stage left, the Canadian tax credit. This is clearly the savior of many a production that is domiciled in Canada, often paying for 30- 40%, and more of a total production. We certainly not saying the rest of your financing becomes a 'cake walk ' , as the expression goes, but our clients routinely maintain that the additional equity, debt, and co production and distribution agreements are much easier to put in place when you utilize the Canadian tax credit .
Naturally the more film funding you can rise via the film tax credit in Canada, as well as debt you can arrange simply means that you are not diluting your ownership position and therefore positioning you well for any financial success on your project.
Its all about partners in business today, and film finance is no exception. By partnering financially, in the right manner, with either co production agreements or Canadian film tax incentives you are able to maintain proper ownership of your project, and that’s of course what it is all about.
Let’s circle back to the Canadian film tax credit. The credits have become increasingly more generous over the years, and apply to all Canadian provinces where you might choose to shoot, film or product your project - depending on your genre again. By properly budgeting your project in a realistic manner an experienced Canadian film financing consultant can assist you in determining the exact amount of dollar eligibility for your tax credit. The tax credit becomes a part of your financial statement filings for the specific legal entity you have created for your project.
You can then finance the credit, which is a non repayable grant/credit from the government. Naturally you can simply wait for the credit, the ' cheque is in the mail ' so the saying goes, but many of our clients choose to finance the credit as soon as they have it certified. Receiving this funding in advance often creates a huge and positive working capital injection that actually helps finance of course the cost of the film. The tax credit is in essence the collateral for the bridge loan you arrange for the film tax credit itself.
Financing and film funding utilizing your Canadian film tax credit can be accomplished in a manner of weeks, and its all about having a budget, a tax credit calculation, and a firm finance plan that identifies the other parts of your project as complete .
Speak to a trusted, credible and experienced Canadian film tax credit financing advisor as to how you can maximize your return on investment for your owners and lenders via the film tax credit in Canada. It's a cash flow 101 great 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 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_funding_film_finance_film_tax.html
Saturday, December 25, 2010
How To Qualify For Sred Tax Credit Financing and Why Sr ed Program Cash Flow works!
Get with the Program ! is an oft used term in business that we often hear . Well, a Sred tax credit financing for Sr Ed program cash flow clearly puts you with the program!
Why Canadian business owners and their financial managers don’t take advantage of the SRED (formally the ' Scientific Research and Experimental Development) tax incentive is beyond us. And when they do take advantage of the program and then don’t at least consider financing their tax credit we really wonder about what they are thinking! Because we can assure our clients their competitors are both utilizing the program as well as financing their claims for instant cash flow and working capital needs.
To finance a claim you of course have to have one, so let’s take a small step back and re cap the program. It's simply, bar none in our opinion, the best government grant type program out their, and grant of course means non repayable and we like that even better.
The program has been around now for 30 years and provides Canadian business with billions of dollars of non repayable grants for the work and funds you expend on R&D in Canada. Almost 20,000 firms take advantage of the program annually - that’s a lot but in reality many firms that are eligible apparently don’t - either not knowing about the program or we guess not interested in free funding. If you can believe that!
The sred tax credit financing program allows you to claim for expenses that qualify in equpment, training, parts of your overhead and salaries, as well as of course the core research you do in developing new products and services.
So, you have determined you qualify, and are further interested in both preparing your claim as well as financing it immediately after it is filed. How is that done ?
SR Ed program cash flow arises out of the claim you file. Larger claims mean larger financings - in Canada typically 70% of your total claim can be financed - that typically means for every 100 dollars of claim filed you receive a bridge loan of 70 dollars. Those funds can be used for basically any sort of corporate purpose. We typically encourage clients to consider using the funds for general working capital, reduction in payables, equipment acquisition, and, who could forget, more research and development to stay ahead of your competitors in the market place.
Good sr Ed claims are usually prepared by qualified sr Ed consultants that know your industry. They maximize your claim and their credentials add professionalism to the viability of your claim being approved in totality. Even if the claims are clawed back the program managers in Ottawa it still of course makes sense to file a claim.
To successfully complete a sred tax credit financing you simply complete a basic business application and provide details of your filed sr Ed. The claim itself is of course the collateral for the bridge loan. Sr Ed program cash flow makes sense because you are simply monetizing a receivable (the sr Ed claim itself) and taking advantage of using non repayable cash now, as opposed to in the future.
Speak to a trusted, credible and experienced Canadian business financing advisor on why cash flow for sr&Ed claims might make great business sense.
--
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_tax_credit_financing_sr_ed_program_cash_flow.html
Why Canadian business owners and their financial managers don’t take advantage of the SRED (formally the ' Scientific Research and Experimental Development) tax incentive is beyond us. And when they do take advantage of the program and then don’t at least consider financing their tax credit we really wonder about what they are thinking! Because we can assure our clients their competitors are both utilizing the program as well as financing their claims for instant cash flow and working capital needs.
To finance a claim you of course have to have one, so let’s take a small step back and re cap the program. It's simply, bar none in our opinion, the best government grant type program out their, and grant of course means non repayable and we like that even better.
The program has been around now for 30 years and provides Canadian business with billions of dollars of non repayable grants for the work and funds you expend on R&D in Canada. Almost 20,000 firms take advantage of the program annually - that’s a lot but in reality many firms that are eligible apparently don’t - either not knowing about the program or we guess not interested in free funding. If you can believe that!
The sred tax credit financing program allows you to claim for expenses that qualify in equpment, training, parts of your overhead and salaries, as well as of course the core research you do in developing new products and services.
So, you have determined you qualify, and are further interested in both preparing your claim as well as financing it immediately after it is filed. How is that done ?
SR Ed program cash flow arises out of the claim you file. Larger claims mean larger financings - in Canada typically 70% of your total claim can be financed - that typically means for every 100 dollars of claim filed you receive a bridge loan of 70 dollars. Those funds can be used for basically any sort of corporate purpose. We typically encourage clients to consider using the funds for general working capital, reduction in payables, equipment acquisition, and, who could forget, more research and development to stay ahead of your competitors in the market place.
Good sr Ed claims are usually prepared by qualified sr Ed consultants that know your industry. They maximize your claim and their credentials add professionalism to the viability of your claim being approved in totality. Even if the claims are clawed back the program managers in Ottawa it still of course makes sense to file a claim.
To successfully complete a sred tax credit financing you simply complete a basic business application and provide details of your filed sr Ed. The claim itself is of course the collateral for the bridge loan. Sr Ed program cash flow makes sense because you are simply monetizing a receivable (the sr Ed claim itself) and taking advantage of using non repayable cash now, as opposed to in the future.
Speak to a trusted, credible and experienced Canadian business financing advisor on why cash flow for sr&Ed claims might make great business sense.
--
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_tax_credit_financing_sr_ed_program_cash_flow.html
Friday, December 24, 2010
Looking for Ways To Finance a Franchise ? There Is Only 1 Way When Financing a Franchise Investment!
You're there. You have made the decision. You're committed. You have timelines now. We're talking about your franchise finance decision and the next challenge you have in the franchise process - financing a franchise. How many ways to finance a franchise are there? Only one... the right way! And we'll show you how.
The ability to finance your franchise properly and satisfy the requirements of the franchisor without putting you overly in debt is what it’s all about of course. And if you do it right then you of course have the potential to grow a business, profit from it, and build owner equity for either long term resale of personal financial gain. That's simply what it's all about, and boy does it help if you like what you are doing, at the same time taking on the entrepreneurship role in Canadian business.
The good news is that your are lucky, because franchising couldn’t be any hotter or more popular. Franchises move goods and services in the billions in Canada, and you're now part of that movement.
But let’s be realistic, whether it’s a franchise investment of any other business start up the same critical needs apply relative to planning and financing.
Homework. Did you hate it in school? Well here it is again because we strongly suggest to clients that you are now in homework mode when determining how financing a franchise works. It’s all about planning, which includes ensuring you have a profitable potential business on your hands, as well as understanding ways to finance a franchise in Canada.
Business plans are critical to your franchise investment. It's a case of demonstrating your business has both profit potential plus, and this is what interests the lender, that you have the ability to repay your debt and loans. The franchisor naturally is interested in long term success of the chain, and your ability to pay royalties as they become due, usually monthly.
When you address the franchise finance decision you must consider a number of items - they are as follows - what is the total all in cost, what methods are available to finance each part of the cost breakdown, and finally, and perhaps most importantly, how is the actual financing done.
The costs to assess in a franchise finance investment are as follows - the initial franchise fee, the cost of fixed assets or leaseholds to your business - i.e. equipment, signage, vehicles if required, etc. And finally, if you did all that and didn’t address working capital for ongoing operations and growth then you are setting yourself up for failure.
Clients are always looking to us for a magic solution and a one stop finance strategy for their franchise investment. The closest we can come to that is the government BIL/CSBF loan, under which the majority of franchises are financing in Canada. You can successfully augment this strategy by equipment financing for a variety of assets as well as a small working capital loan, usually unsecured. Don't forget also that your own owner equity investment becomes the final piece of the puzzle.
And getting back to our business plan, ensure that you have covered off all the debt you need and that if reflects your ability to pay it back.
Financing a franchise. Challenging? Yes, we guess so. Possible? Of course. Speak to a trusted, credible and experienced Canadian business financing advisor with franchise experience who will help you navigate, successfully, the only way to finance your new business - the right way!
--
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/ways_to_finance_a_franchise_financing_a_franchise.html
The ability to finance your franchise properly and satisfy the requirements of the franchisor without putting you overly in debt is what it’s all about of course. And if you do it right then you of course have the potential to grow a business, profit from it, and build owner equity for either long term resale of personal financial gain. That's simply what it's all about, and boy does it help if you like what you are doing, at the same time taking on the entrepreneurship role in Canadian business.
The good news is that your are lucky, because franchising couldn’t be any hotter or more popular. Franchises move goods and services in the billions in Canada, and you're now part of that movement.
But let’s be realistic, whether it’s a franchise investment of any other business start up the same critical needs apply relative to planning and financing.
Homework. Did you hate it in school? Well here it is again because we strongly suggest to clients that you are now in homework mode when determining how financing a franchise works. It’s all about planning, which includes ensuring you have a profitable potential business on your hands, as well as understanding ways to finance a franchise in Canada.
Business plans are critical to your franchise investment. It's a case of demonstrating your business has both profit potential plus, and this is what interests the lender, that you have the ability to repay your debt and loans. The franchisor naturally is interested in long term success of the chain, and your ability to pay royalties as they become due, usually monthly.
When you address the franchise finance decision you must consider a number of items - they are as follows - what is the total all in cost, what methods are available to finance each part of the cost breakdown, and finally, and perhaps most importantly, how is the actual financing done.
The costs to assess in a franchise finance investment are as follows - the initial franchise fee, the cost of fixed assets or leaseholds to your business - i.e. equipment, signage, vehicles if required, etc. And finally, if you did all that and didn’t address working capital for ongoing operations and growth then you are setting yourself up for failure.
Clients are always looking to us for a magic solution and a one stop finance strategy for their franchise investment. The closest we can come to that is the government BIL/CSBF loan, under which the majority of franchises are financing in Canada. You can successfully augment this strategy by equipment financing for a variety of assets as well as a small working capital loan, usually unsecured. Don't forget also that your own owner equity investment becomes the final piece of the puzzle.
And getting back to our business plan, ensure that you have covered off all the debt you need and that if reflects your ability to pay it back.
Financing a franchise. Challenging? Yes, we guess so. Possible? Of course. Speak to a trusted, credible and experienced Canadian business financing advisor with franchise experience who will help you navigate, successfully, the only way to finance your new business - the right way!
--
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/ways_to_finance_a_franchise_financing_a_franchise.html
Thursday, December 23, 2010
Why Asset backed business loans And Asset Lending Make Your Business Financeable For Growth
When was the last time you really found business loans solutions that made total sense for your firm. We're thinking that you will say ' right about now!" after you finish hearing what we’re going to tell you about asset lending and asset back lines of credit in Canada.
Looking for understatements .?We always are. Here's one... ‘Business financing has never been more difficult to achieve than in the last couple years ‘! Now that’s an understatement. It seems to be all about problems and never about solutions.
What if there was a type of business financing in Canada that made all firms eligible yet at the same time gave you access to unlimited amount of credit , and only had one requirement . Too good to be true? Not necessarily. And what is that requirement our clients always ask, and the answer is ' assets ‘.
Canadian asset lending via a non bank asset backed line of credit makes business loans sense today more than it ever has before.
Let’s get to the core of the solution, and then you'' see how that solution can fix your current financing challenges. This type of business operating loan is a revolving line of credit that is secured by inventory, accounts receivable, and other balance sheet asset accounts as may be applicable. (Typically those might be equipment and real estate in some cases)
Is there a size that seems to make the most sense when you contemplate such a financing. We have found through experience that clients that require at least a 250k/mo operating working capital requirement are the best candidates for this type of financing. There is virtually no upper limit on asset based line of credit financing in Canada!
We always come back to the word ' assets' in discussing the availability of this type of financing. On a day to day basis you monitor your receivables, inventory, etc and simply draw down against them. As you can see the facility fluctuates every day simply because each day your firm bills new customers, collects receivables from past sales, and purchases inventory and converts that product into a sale and resulting receivable. That whole process is known as your operating cycle.
Asset backed lending in Canada is a secured form of lending that grows as you grow. That’s the main difference from a chartered bank line of credit, which typically has fixed limits and imposes all sorts of other conditions re rations, covenants, collateral, and personal guarantees on the business owners and managers. That’s now that asset lending via bank line of credit is about in Canada.
The key qualification difference here is that a large amount of the approval process for this type of facility revolves around verifying your assets such as the quality of your receivables, inventory turns, , and your ability to ' scorecard' your business via proper financial reporting every month around receivables and inventory .
Does our solution make sense? We think it does if you are in one of several categories, including not being able to access bank credit, not being able to access enough bank credit, and if your firm is in a growth mode and has assets that can be financing for working capital needs .
Speak to a trusted, credible and experienced Canadian business financing advisor who can guide you through the asset backed line of credit strategy for your firms survival, growth, and profit.
-
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_lending_asset_backed_business_loans.html
Looking for understatements .?We always are. Here's one... ‘Business financing has never been more difficult to achieve than in the last couple years ‘! Now that’s an understatement. It seems to be all about problems and never about solutions.
What if there was a type of business financing in Canada that made all firms eligible yet at the same time gave you access to unlimited amount of credit , and only had one requirement . Too good to be true? Not necessarily. And what is that requirement our clients always ask, and the answer is ' assets ‘.
Canadian asset lending via a non bank asset backed line of credit makes business loans sense today more than it ever has before.
Let’s get to the core of the solution, and then you'' see how that solution can fix your current financing challenges. This type of business operating loan is a revolving line of credit that is secured by inventory, accounts receivable, and other balance sheet asset accounts as may be applicable. (Typically those might be equipment and real estate in some cases)
Is there a size that seems to make the most sense when you contemplate such a financing. We have found through experience that clients that require at least a 250k/mo operating working capital requirement are the best candidates for this type of financing. There is virtually no upper limit on asset based line of credit financing in Canada!
We always come back to the word ' assets' in discussing the availability of this type of financing. On a day to day basis you monitor your receivables, inventory, etc and simply draw down against them. As you can see the facility fluctuates every day simply because each day your firm bills new customers, collects receivables from past sales, and purchases inventory and converts that product into a sale and resulting receivable. That whole process is known as your operating cycle.
Asset backed lending in Canada is a secured form of lending that grows as you grow. That’s the main difference from a chartered bank line of credit, which typically has fixed limits and imposes all sorts of other conditions re rations, covenants, collateral, and personal guarantees on the business owners and managers. That’s now that asset lending via bank line of credit is about in Canada.
The key qualification difference here is that a large amount of the approval process for this type of facility revolves around verifying your assets such as the quality of your receivables, inventory turns, , and your ability to ' scorecard' your business via proper financial reporting every month around receivables and inventory .
Does our solution make sense? We think it does if you are in one of several categories, including not being able to access bank credit, not being able to access enough bank credit, and if your firm is in a growth mode and has assets that can be financing for working capital needs .
Speak to a trusted, credible and experienced Canadian business financing advisor who can guide you through the asset backed line of credit strategy for your firms survival, growth, and profit.
-
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_lending_asset_backed_business_loans.html
Wednesday, December 22, 2010
Staying Afloat via cash flow financing – Cash Flow for Business Solutions
So we're all in agreement, right ? - staying afloat is better than sinking... and talking to clients seeking cash flow for business seems to be mostly what we are doing these days. Cash flow financing for your business, whether you like it or not is at the top of the ‘ worry pile’ for Canadian business owners these days.
We'll discuss the problem, how you measure the problem, and, most importantly, some great solutions both traditional and alternative. And by the way, alternative is fast becoming traditional, but more about that later!
In talking to clients about business financing and business cash flow we always get the distinct impression they feel their business is unique - and that may be so but the truth of the matter is that the cash flow financing challenges you face are being faced by everyone else in and out of your industry.
As a business owner you can be forgiven for thinking your business cash flow financing challenges are unique, probably because of the mix. What do we mean by the mix? Simply that each h company and industry has difference levels of inventory, receivables, payables, all of which factor uniquely into the working capital challenge.
In fact, whether you like it or not, about 80%, yes 80% of all you assets are in receivables, inventory, and to some extent prepaid.
Your ability to ' turnover' these assets is what makes your business successful, or not.
Each industry has different gross margins, and if you have great gross margins then you can withstand a bit less turnover that is required in inventory and receivables. If you are in a low gross margin business turnover is absolutely critical. And you measure that turnover by three key metrics, inventory turns, days sales outstanding or collection turnover, and finally days payable outstanding.
Turnover drives working capital and many business owners kind of know that, but more often than not aren’t focusing on improving that turnover.
So , lets get back to staying afloat , which is what its all about !There are a number of cash flow financing solutions that allow you to address cash flow financing for your business . If it was a perfect world you would have all the liquidity you need from you bank, but bank financing is always a challenge for business, and in many cases inventory is not part of the financing mix that is available.
There are at least 5 great cash flow for business solutions available to help you succeed in Canadian business financing. These include the selling of your receivables, which can be done confidentially, and thereby generating instant cash flow for your company. For firms with 250k+ in assets and receivables you are in a position to be a candidate for a fully margined A/R and inventory working capital facility, available through a non bank solution. Larger firms with significant investments in working capital (receivables and inventory) are eligible for asset based lending which is in our opinion the ultimate Canadian working capital solution.
Most business owners don’t know they can access cash flow financing via the financing of Purchase Orders (p o’ s) and contracts. They allow you to consider orders significantly higher than you could have ever handled in the past. And, finally firms with relatively good financial standing can access unsecured cash flow working capital term loans via non bank lenders.
So whats it all about. We think we have been fairly clear, and hope you agree. It’s about understanding your cash flow financing challenges, measuring them via the turnover of working capital accounts, and finally, accessing any one of the five, yes 5! solutions we have provided .
Speak to a trusted, credible and experienced Canadian business financing advisor as to what makes 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 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/cash_flow_for_business_cash_flow_financing.html
We'll discuss the problem, how you measure the problem, and, most importantly, some great solutions both traditional and alternative. And by the way, alternative is fast becoming traditional, but more about that later!
In talking to clients about business financing and business cash flow we always get the distinct impression they feel their business is unique - and that may be so but the truth of the matter is that the cash flow financing challenges you face are being faced by everyone else in and out of your industry.
As a business owner you can be forgiven for thinking your business cash flow financing challenges are unique, probably because of the mix. What do we mean by the mix? Simply that each h company and industry has difference levels of inventory, receivables, payables, all of which factor uniquely into the working capital challenge.
In fact, whether you like it or not, about 80%, yes 80% of all you assets are in receivables, inventory, and to some extent prepaid.
Your ability to ' turnover' these assets is what makes your business successful, or not.
Each industry has different gross margins, and if you have great gross margins then you can withstand a bit less turnover that is required in inventory and receivables. If you are in a low gross margin business turnover is absolutely critical. And you measure that turnover by three key metrics, inventory turns, days sales outstanding or collection turnover, and finally days payable outstanding.
Turnover drives working capital and many business owners kind of know that, but more often than not aren’t focusing on improving that turnover.
So , lets get back to staying afloat , which is what its all about !There are a number of cash flow financing solutions that allow you to address cash flow financing for your business . If it was a perfect world you would have all the liquidity you need from you bank, but bank financing is always a challenge for business, and in many cases inventory is not part of the financing mix that is available.
There are at least 5 great cash flow for business solutions available to help you succeed in Canadian business financing. These include the selling of your receivables, which can be done confidentially, and thereby generating instant cash flow for your company. For firms with 250k+ in assets and receivables you are in a position to be a candidate for a fully margined A/R and inventory working capital facility, available through a non bank solution. Larger firms with significant investments in working capital (receivables and inventory) are eligible for asset based lending which is in our opinion the ultimate Canadian working capital solution.
Most business owners don’t know they can access cash flow financing via the financing of Purchase Orders (p o’ s) and contracts. They allow you to consider orders significantly higher than you could have ever handled in the past. And, finally firms with relatively good financial standing can access unsecured cash flow working capital term loans via non bank lenders.
So whats it all about. We think we have been fairly clear, and hope you agree. It’s about understanding your cash flow financing challenges, measuring them via the turnover of working capital accounts, and finally, accessing any one of the five, yes 5! solutions we have provided .
Speak to a trusted, credible and experienced Canadian business financing advisor as to what makes 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 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/cash_flow_for_business_cash_flow_financing.html
Tuesday, December 21, 2010
Save Thousands When Utilizing Lease Financing Via Equipment Lease Companies In Canada
Your lease financing strategies in Canada are a balancing act, but do you know how to manage, or even locate the best lease companies in Canada? It's pretty clear to us that our clients are keenly aware of the tight balancing act you face whenever you contemplate an equipment financing acquisition .
We're reminded of the definition of ' Saving ‘... which is simply the act of managing a resource such as your capital and putting it to work in the best manner . But do you have to give up something to get a solid equipment financing approval with a structure that makes sense to your company. We don’t think so, and we will show you how to navigate, successfully! The maze of what is known as equipment financing in Canada.
We are reminded that the best way to be successful in achieving the benefits that lease financing bring to the table is to simply ' visualize ' them. More often than not in lease financing you are focusing on getting a return on investment on your acquisition, and structuring it financially in a way that makes sense.
Can you, as we maintain, save thousands of dollars on an equipment lease when you ' do it right’? We believe you can. But first you have to focus on why you financing the equipment, and why certain lease companies in Canada may or may not be your best bet when you finance.
You finance equipment for some very basic reasons - lets cover them off... and we get rid of the most boring one first, accounting. The accounting treatment of a lease is very important and often mis understood or not properly address when we discuss the issue with clients. For instance, if you can keep the lease off balance sheet you have just delivered a greater return on asset value to the owners or shareholders of your firm. That’s a key measurement used by owners, lenders and investors when they look at your firm. If you firm is capital driven, meaning you need lots of capital to run your business then structuring the right type of lease will have immeasurable positive effect on your performance and operating ratios.
Many operating lenders structure your credit agreements around your rations, and properly handled and accounted for leases can be a real positive in this regard.
Financial and cash flow reasons also drive owner behavior when lease financing in Canada. It's all about working capital preservation. Even negotiating a lower down payment or a higher balloon payment at the end of your lease can save you many thousands of dollars, depending on the size of your transaction. Those savings can be re invested into the company to generate further sales and profits.
Have you made the mistake of acquiring technology on a lease and then having to write down the book value of the lease half way through the transaction when you have just discovered, surprise, surprise! That your technology is now obsolete! Matching the tem of the lease with the useful economic life of the lease can save you thousands in potential equipment write downs in the technology area - think computer investments, telecom systems, etc.
We hate it, but most of our clients are focused on only one thing, which is the proverbial lease rate. Unfortunately equipment lease companies in Canada know this and can do a real number on your firm when it comes to camouflaging the true rate in a lease - this is done by quoting you payments calculated in arrears, getting first and last payments in advance, increasing the size of a security deposit, or charging you per diem rates for project type financing when leasing is required.
If you have all the time in the world and know every nuance of Canadian lease finance then by all means attend and address all of those issues and strategies. Alternatively, speak to a trusted, credible and experienced Canadian business financing advisor who will structure the right lease that focuses on benefits that are real to your firm, saving you thousands in the process. That’s a solid plan to save money !
--
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/equipment_lease_companies_lease_financing.html
We're reminded of the definition of ' Saving ‘... which is simply the act of managing a resource such as your capital and putting it to work in the best manner . But do you have to give up something to get a solid equipment financing approval with a structure that makes sense to your company. We don’t think so, and we will show you how to navigate, successfully! The maze of what is known as equipment financing in Canada.
We are reminded that the best way to be successful in achieving the benefits that lease financing bring to the table is to simply ' visualize ' them. More often than not in lease financing you are focusing on getting a return on investment on your acquisition, and structuring it financially in a way that makes sense.
Can you, as we maintain, save thousands of dollars on an equipment lease when you ' do it right’? We believe you can. But first you have to focus on why you financing the equipment, and why certain lease companies in Canada may or may not be your best bet when you finance.
You finance equipment for some very basic reasons - lets cover them off... and we get rid of the most boring one first, accounting. The accounting treatment of a lease is very important and often mis understood or not properly address when we discuss the issue with clients. For instance, if you can keep the lease off balance sheet you have just delivered a greater return on asset value to the owners or shareholders of your firm. That’s a key measurement used by owners, lenders and investors when they look at your firm. If you firm is capital driven, meaning you need lots of capital to run your business then structuring the right type of lease will have immeasurable positive effect on your performance and operating ratios.
Many operating lenders structure your credit agreements around your rations, and properly handled and accounted for leases can be a real positive in this regard.
Financial and cash flow reasons also drive owner behavior when lease financing in Canada. It's all about working capital preservation. Even negotiating a lower down payment or a higher balloon payment at the end of your lease can save you many thousands of dollars, depending on the size of your transaction. Those savings can be re invested into the company to generate further sales and profits.
Have you made the mistake of acquiring technology on a lease and then having to write down the book value of the lease half way through the transaction when you have just discovered, surprise, surprise! That your technology is now obsolete! Matching the tem of the lease with the useful economic life of the lease can save you thousands in potential equipment write downs in the technology area - think computer investments, telecom systems, etc.
We hate it, but most of our clients are focused on only one thing, which is the proverbial lease rate. Unfortunately equipment lease companies in Canada know this and can do a real number on your firm when it comes to camouflaging the true rate in a lease - this is done by quoting you payments calculated in arrears, getting first and last payments in advance, increasing the size of a security deposit, or charging you per diem rates for project type financing when leasing is required.
If you have all the time in the world and know every nuance of Canadian lease finance then by all means attend and address all of those issues and strategies. Alternatively, speak to a trusted, credible and experienced Canadian business financing advisor who will structure the right lease that focuses on benefits that are real to your firm, saving you thousands in the process. That’s a solid plan to save money !
--
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/equipment_lease_companies_lease_financing.html
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