5 Questions – 5 Answers On The Canadian Government Loan Small Business Program – SBL Funding

Financing With The Government Small Business Loan In Canada


Information on the Canada Government Small Business Loan Program – SBL Funding Helps Thousands Of Businesses Like Yours





The Canadian Small Business Loan Program, commonly called the SBL Loan provides funding for thousands (over 7000 firms in 2010) of Canadian businesses just like yours. The program has been in existence for many of years and yet still many Canadian business owners and financial managers like you still have sometimes not even heard of the program!

Contrary to popular opinion these loans do not require a tremendous amount of time or effort and you are not dealing with a faceless government employee, as some might think.

Industry Canada, which sponsors the program grants Canadian chartered banks the authority to underwrite and approve loans and financing under the program. If you qualify, and know what and how to do things, you can receive approval for the loan within 48 hours.

Given the current economic challenges in Canada it clearly is refreshing news that Canadian business owners, from start up to established firms can receive financing up to $ 500,000.00 under the program. The Canadian banks are chartered to look out for the programs interest of course, but at the end of the day don’t forget the main goal - facilitation your access to credit a capital that you might not otherwise secure.

There isn’t a day when we don't receive questions from clients about the program, everything from basic questions to issues that confuse the Canadian business owner about the program. Lets over off 5 of those questions, then consider yourself well informed about the SBL small business government loan program, funding on great terms, for your company.

Question 1- What type of loan is available? The answer to that is pretty simply, the program covers financing for real estate, equipment, leaseholds, computer software. What it doesn’t cover, which is typically what many clients are looking for, is funding of operating assets such as cash, inventory, and receivables. These assets are used to expand your business and provide financing at rates, terms and structures you might likewise not be able to achieve. Don’t forget this includes start ups also!
Question # 2 - Qualifications. The qualifications are simple. Business owners must have a decent personal credit history, a business address or location, a down payment of minimum 10% on assets financed, and a business plan that makes sense. Certain financial ratios must work re debt and opening working capital.

Third Question - Down payment, equity. The basic story is that you must have a minimum of 10% down on all financings, but to satisfy some of the bank guidelines you must have anywhere from 30% down to ensure opening working capital and debt to equity make sense for the custodians of the program .. The bank.

Questions # 4 - The approval process! How does it work?? The bottom line is that it’s not as complicated as you think. This is a great time to work with an experienced business advisor on ensuring you have a crisp plan that satisfied the program basics. Some standard business documentation back up - articles of incorporation, cash flow, owner net worth statement, etc should allow you to ensure that an approval is received in a matter of days. Not exactly what you associate with a government program... right?!

Final question - How does the Small business government loan program, i.e. SBL funding differ from normal financing. Its simple, the government is guaranteeing a huge portion of the loan to your bank. No personal collateral is required, and unlike most Canadian financing your personal guarantee is limited to only 25% of your financing. Terms are anywhere up to 7 years, and rates are comparable to what the big boys get.

The bottom line, the SBL program is probably a lot more user friendly than you think. If you work with a trusted, credible and experienced Canadian business financing advisor you can use this financing to meet the growth needs of your business, from start up to established 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/small_business_program_government_loan_funding_sbl.html

Financing A Franchise Business Purchase Loan In An Economic Downturn ? Canadian Franchising Loans Explained !

Don’t Let Economic Bad Times Deter Your Franchise Purchase

Information on financing a franchise business purchase in Canada . What type of loan / loans and finance facilities make your franchise work!



The right approach. That's definitely what it takes to finance a franchise business purchase in somewhat challenging economic times.

The majority of aspiring franchisees in Canada look to banks and specialized finance firms when investigating the purchase of a new or existing franchise business. Let's investigate successful criteria and methods for completing the purchase of such a business.

Do Canadian banks finance a franchise? That naturally is the instinctive first ' go to ' when it comes to the entrepreneur’s choice of completing a business purchase in the franchise industry. Broadly speaking they don’t specifically finance franchises outside of specialize government or franchisor programs.

If you have a stellar personal net worth and credit rating we suppose that many banks would consider some sort of term loan based on collateralizing your personal assets... that naturally is not our recommendd strategy, as we hav always felt its important to separate your business and persoanl life when it comes to finances.

Jut how important is your personal credit history as well as your overall financial profile... what the finance folks call you personal net worth - simply speaking ' what you have ' and ' what you owe'! We assure clients that a strong emphasis is placed on your personal credit and business background - typically you would want a ' beacon score ' at the credit bureau to be in excess of 650.

If you do choose to secure a franchise with personal assets you'll be asked to provide collateral such as a home mortgage, etc. Again, as we said that’s not our recommended strategy.

So if the banks don’t finance franchises in Canada who does. Are you ready? Banks! What do we mean by that seeming contradiction? Simply that the majority of franchises in Canada are financed by the banks, but via vehicle known as the BIL/CSBF loan. It’s a program run by the federal government which many banks have adopted as a solid vehicle to finance franchises in Canada.

The basics of the program lend themselves pretty perfectly to financing a franchise business purchase, and the structure of these loans fits what you are trying to achieve. Why? Simply because terms of the loan are from 5-7 years, rates are commensurate with many other types of business financing, with the ' kicker' being that you only are required to guarantee 25% of the loan.

Will a franchisor step in to help you finance your business? That’s a question we get a lot, and the answer generally is ' NO ‘. In a number of cases though franchisors have worked out packages that can more easily facilitate the bank completing a financing. This tends to work with larger brands and larger business acquisitions in franchising. The bottom lone, don’t expect internal financing from your franchisor.

Other key aspects of successfully finance a franchise in a downturn are common sense business elements - a solid business plan, locating a banker of financial advisor that is experienced in franchise loans, and aligning yourself with a successful franchisor based on your own personal and business background .

Speak to a trusted credible and experienced Canadian business financing advisor on how you to can finance a business purchase in challenging times.



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_franchise_business_purchase_loan_loans.html

Seriously , Can An Asset Based Line Of Credit Loan Facility Meet Your Canadian Financing Needs ? Yes , ABL Finance Works !

Why One Type Of Business Financing Is Starting To Dominate Commercial Borrowing In Canada



Information on how an asset based line of credit loan facility provides financing and capital for Canadian business lending needs and requirements .



We've often said that no one type of business financing in Canada has the ability to meet pretty well all of your growth and survival needs. That might not be true all the time in the context of an asset based line of credit loan facility.

ABL facilities are somewhat of a hybrid type of facility, and for that reason this type of commercial business finance lending actually does, in many cases, suit all of your financing needs. Let's examine how.

Part of the appeal of ABL asset based lines of credit is simply that unlike many forms of commercial business financing it is accessible by smaller firms, large corporations, start ups, and firms who sometimes find themselves in serious financial difficulties. We think we've covered the bases on that one!

Typical considerations for entering into an ABL facility revolve around being unable to qualify for what many dub as ' traditional lending ‘... In Canada that traditional lending comes via our chartered banking system.

So just exactly how does your firm move forward in considering an asset based line of credit loan financing? And, ready for a positive surprise? Asset based lending has total flexibi8lity around structure, term, pricing, and 99% of the time comes with less covenants and ratio restrictions required by our chartered banking system.

Is there a typical profile of a Canadian business looking for an alternative to a business line of credit? The immediate thought that comes to mind is simply your firm’s current inability to achieve the financing you need from a bank. Typically this means your profits and losses have fluctuated, or there are some balance sheet issues that simply have for firm temporarily under water, so to speak, re: the ability to qualify for a commercial bank business line of credit.

We also meet with many clients who have secured favorable credit facilities from a bank or commercial credit union, but they are unable to tap into, or leverage assets anymore than current limits prescribed by the bank. Typical working capital advances for receivables by a bank are 75% ...while ABL lending more often than not comes in at 90%... so right away you are up 15% in over all liquidity.

And we haven’t even started, because many firms who find the inventory component of their business difficult to finance are often surprised that inventory advances in an ABL facility can run from 30-70%... sometimes more, sometimes less.

So why can an ABL lender offer this type of financing when bank sometimes cannot? It's a good question many clients ask right out of the gate. ABL lenders tend to be unregulated institutions; therefore simply speaking heir capital comes from different places and different pricing. They re not bound by capital and conservative lending practices that our Canadian banks are so well known form.

While our banks are some of the strongest and well run on the planet the other side of the coin in this statement suggest a more prudent lending to commercial borrowers. That’s where the ABL advantage comes in. Asset lender turns your day to day assets, i.e. A/R, equpment, and inventory into a revolving line of credit that significantly leverages up your ability to borrow.

Simply speaking, it’s all about the assets, not the ratios! Another way we explain it to clients is simply that the bank in general is looking more at your financials... an asset based line of credit loan financing is looking more at your assets .

Pricing for this type of financing varies significantly. The simple explanation on pricing is that the size of your facility, the quality of your assets, and the type of firm you are dealing with dictate ultimate pricing. In many cases pricing is equivalent to the bank, however more often than not its more expensive, but, and its a key point... you have more liquidity and working capital on an ongoing basis, growing lock step with your needs.

Speak to a trusted credible and experienced Canadian business financing advisor who, seriously! can demonstrate to you the benefits of an ABL facility for your Canadian company.




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/asset_based_line_of_credit_loan_lending_financing.html

Break The Shackles Of Canadian Working Capital Financing Challenges – Proven Methods To Finance A Business

Give your business the working capital and cash flow it deserves

Information on Canadian working capital financing techniques and strategies . How to finance a business via traditional and alternative solutions that work !



We're the first to admit that any Canadian business, from start up to established company often has the feeling they are somewhat shackled in working capital financing options. So how do you finance a business from a cash flow perspective and how one measure does and evaluate the options. Let's dig in, as usual!

A good start is to simple differentiate between short term cash needs (that’s working capital by the way ) and long term debt and financing solutions . That short term cash flow we're talking about is the cash flow you use on a day to day basis to finance a business - those mundane things like payroll, purchasing inventory, covering your fixed costs, etc!

As that cash flow deteriorates or goes down you not only don’t meet those short term obligations but you run the risk of failing to meet long term debt such as leases, loans, etc.

There are essentially three reasons your firm ends up needing working capital financing - they are of course if you are a start up , secondly if you are growing rapidly, and thirdly if your firms basic situation is such that your current operations cant finance day to day activities . This typically arises out of your growth and management of receivables and inventory.

When smaller businesses in Canada borrow for working capital purposes a significant amount of emphasis is placed on the owner’s personal credit .As your company grows the focus turns and it’s now up to you to properly position your businesses financial situation - that means proper presentation of your balance sheet, income statement and projected cash flow.

The good news about working capital financing is that it is not debt in the true sense of the word - it’s simply the monetization of your current assets, typically receivables and inventory. The challenge though it to ensure you don’t over borrow on those assets , that you manage them properly, so that your borrowing doesn’t become what one writer recently described as an ' addiction '.

Quite frankly we agree, and the reality is that the best line of credit is one that goes up and down all the time, and doesn’t stay maxed out at the top of the facility. If in fact you are always at the top of your working capital financing facility you might well be close to some sort of financial challenge or catastrophe.

Of course there are times when it makes perfect sense to borrow and incur debt outside the working capital needs - a good example might be the need for more equipment. Paying for a long term asset out of current operating capital is not recommended. If the equipment generates profits and has a longer term useful life you have made the correct financing decision.

In Canada working capital options range from traditional to alternative. A bank working capital facility will margin 75% of receivables and potentially, but certainly not always, a portion of your receivables. Larger firms have access to non bank asset based lines of credit that provide a very healthy margin of cash flow by utilizing 90% of your receivables and anywhere from 30-70% of your inventory. A subset of asset based lending is accounts receivable financing, which monetize your invoices... on a daily basis. While more costly your firm has just turned itself into an ATM machine for constant cash flow as you grow your business.

Other alternative methods of cash flow financing including monetizing (that’s financing) your government tax credits, or even financing your purchase orders or contracts.

Still feel shackled? Canadian business owners and financial managers shouldn’t feel prisoners due to lack of working capital financing. Don't over borrow; ensure you know what facilities are available. Speak to a trusted, credible and experienced Canadian business financing advisor who can assist you in identifying immediate solutions... unleashing those shackles!




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_financing_finance_a_business.html

8 Reasons You Need To Know About Canadian Business Equipment Leasing Companies & Financing Providers

Over 80% Of All Canadian companies lease assets – Do you know why?



Information on business equipment leasing companies in Canada and what you need to know about financing providers to achieve true benefits of lease finance.




100% comfortable? We're talking about dealing with business equipment leasing companies and the financing of business assets. Equipment financing is simply a tool to achieve the acquisition of assets. Canadian business owners have different reasons to enter to an equpment lease finance transaction - those reasons might be cash flow oriented, tax oriented, or financial measurement oriented.

Let’s examine 8 key basics around which successful lease financing is based in Canada. Most business people appreciate the fact that leasing often covers off anywhere from 90-100% of the cost of the asset, but did you also know that numerous ancillary costs can be bundled into your transaction? They include delivery, installation, maintenance, warranty, etc. Those additional costs can add up.

Pick you term .That’s our # 2 reason. Prudent business owners and financial managers will give thought to the term of their lease, optimally identifying the useful life of the asset with cash outflows. In Canada typical lease terms range from 2- 5 years, shorter terms are almost impossible, longer terms are possible when the asset and credit quality of your firm permit.


Our 3rd Reason - simply flexibility around payments and your cash flow . Your monthly payments on an equipment lease can easily be structured into step payments ( paying more later ), skip or seasonal payments, etc. In business it's all about cash flow and cash flow benefits count big in Canadian equipment lease finance.


Reason # 4- Lease vs. purchase and cash flow considerations. The majority of business owners will find that if they run some analysis around their cost of funds as well as what they would be able to do with funds otherwise not spent on the purchase of assets . In the 2011 business environment rates are low and leasing is ultra competitive, so the overall rate environment simply enhances your lease vs. buy decision.


Reason #5 - loan covenants and financial measurements. Many Canadian businesses, especially those with bank financing in place may find it challenging to acquire assets without breaching loan and ratio restrictions imposed by the bank. Carefull structuring of lease transactions can eliminate this challenge. As well many firms measure their management and owners on financial criteria such as return on assets and return on equity. Business equipment leasing companies can help you win when these measurement scenarios are in place.

Reason # 6 - You can more often than not expect approval on a lease financing decision much more quickly than a loan or other type of financing solution. It is certainly very typical to obtain a full lease finance commitment within days of submitting a proper request (key word = proper).

Reason # 7- the ultimate value of your asset can be a significant financial benefit to your company. You might be acquiring assets that have a useful life beyond the term of the lease. This asset can be either sold or re financed at the end of the term, enhancing your firm’s cash and working capital.

Reason # 8 - The Paperwork. In general we can make the comment that documentation in Canadian equipment financing is efficient. Whether you have a master lease in place or if you are simply acquiring a small business asset lease docs are simple and easy to understand when you've dealing with business equipment leasing companies. In Canada the industry is broken down into small, mid and large ticket transactions. Small deals can be approved in hours, larger transaction takes a bit, but not a lot more time... again, if properly document and presented.

Speak to a trusted, credible and experienced Canadian business financing advisor on the benefits of dealing with business equipment leasing companies for financing of assets. It's clearly a win win scenario!



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_companies_financing.html

Study : Can Financing Receivables Via A Confidential Receivable Factoring & Funding Solution Save Your Company?

Do The Benefits of A/R Finance Solve Your Working Capital Challenges ?


Information on financing receivables in Canada . What is a receivable factoring solution and how does funding a/r solve the gap in your firms cash flow and working capital needs.




We're pretty sure, based on talking to clients, that thousands of Canadian business owners and financials managers start every Monday worrying about business financing and cash flow. A lot is being said these days about financing receivables as a subset of asset based lending in Canada.

But can a receivable factoring and funding strategy really save your company? And another thing, what's a confidential invoice funding strategy and how does it work. A lot of questions! Let’s get some answers.

It is somewhat ironic that the growth your firm faces, which is clearly a good thing is offset by the need for more and more cash flow and working capital as you build receivables, and yes, inventories also. It's a very simple gap - simply the time between being paid for your customers and the need to pay suppliers and your operating costs. In a perfect world (it’s not apparently) your suppliers would be willing to wait an unlimited amount of time. They don't.

Therefore financing your receivables as you generate them provides you with cash flow needed - you are simply closing the proverbial gap in waiting for your clients funds.

In Canada you should expect, via a receivable finance strategy to receive in the area of 90% for your receivable funding as you submit invoices. What about that other 10%? It’s simply held back as a holdback or reserve to leave a buffer for financing costs and any short payments for your clients.

Financing costs. That’s the real discussion point these days on receivable factoring in Canada. Those costs range from 1- 5%. That’s a big range, so what defines that range. Typically the 4-5% range is defined by firms having very small receivable balances and who themselves are relatively small firms. A more typical range in Canada is 2%. While many clients view that as and interest rate on a 30 day basis it’s actually the discount your finance partner bases the purchase of your receivables on. So, utilizing a $100,000 dollar invoice as an example you should be expected to ultimately receive $ 98,000 for the invoice. That’s at settlement time when your client pays and you also receive the rest of the holdback we referred to.

So is that financing fee too much for your firm ?History tells us its not, in that your ability to generate more sales with the cash flow you receive daily usually significantly outweighs lost sales revenue , or , even worse, your ability not to meet your obligations to supplies or other creditors . The majority of clients we speak to are looking to grow their business and use a receivable factoring strategy as a tool to do that.

If you are looking at the traditional type of receivable finance facility in Canada that is offered there is one aspect that doesn’t appeal to many business owners, in that 99% of the firms in Canada who offer A/R finance require a notice to your client around this financing. That’s where a confidential invoice funding strategy works best, you bill and collect your own receivables, and your method of financing your firm is just that, yours, and no one else’s business.

So, can financing receivables save your company? We thing if it isn’t a matter of saving it’s a least a mechanism for growing, and that’s not a bad thing. To be honest though many firms that face financial challenges are often saved by an interim funding strategy such as ours when they cant obtain traditional bank type finance .

More info? Questions ? Speak to a trusted, credible and experienced Canadian business financing advisor on the benefits of a confidential invoice 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/financing_receivables_receivable_factoring_funding.html

Does A Canadian Vendor Leasing Program Increase Sales, Cash Flow and Profits? Yes, and Here’s Why Equipment Financing Works

Tap Into a New Business Success Tool - Customer Financing Made Easy !


Information on why Canadian business owners should consider a vendor leasing program and why equipment financing works for cash flow , profit and sales acceleration .


Rarely does one financing tool or mechanism lend itself to so many growth, profit and cash flow aspects of your business. You can achieve that by your consideration of a vendor leasing program for your clients. And oh, by the way, it can be done at no cost, some cost, or a lot of cost, it’s your choice. We'll show you how!


How does it not make sense to consider how your clients pay and acquire your products? When you are in a position to offer a financing tool to your clients you are now perceived as ' full service ' and ' value added ' to your clients. Those two terms, often over used and abused, make true sense, we think, in the context of being able to help your clients acquire your products and services.

So lets focus in on growing business, we're all for that. Depending on the product or service you sell, everything from machinery, construction equipment, or even computer software all your clients may have a sense of what we call ' sticker shock' around the price of your firms goods . And the reality is, even though it may not be the price, it can often be a budgetary and timing restriction of some sort. Larger firms are deeply embroiled in budgets, capital acquisition, and returns on equity and assets that may significantly impact their thinking on how they acquire your good and services.


By offering them a payment strategy you enhance your ability to close more sales, and, as importantly, reduce the sales cycle and lead time that come with some many acquisition decisions.

But how do you do that? The expensive way, we referred to it above as costing a lot, is to set up and fund your own finance firm. Very few companies in Canada in the current environment have the capital, and expertise to do that.

The alternative? Simply work with a trusted partner to co brand and private label a finance offering under your name. They will run it, administer it, and yes, fund it. That’s a win win scenario of course. And don’t forget, this entire id done for the benefit of your business.

By offering an equipment financing strategy you are now in a position to discuss pricing and discount a lot less than you would normally. That's a good thing, your client is now focused on a monthly payment, not determine their maximum discount from yourself. You also have a higher perceived value in your client’s eyes; you have now made it easier for them to reach the purchase decision with your firm.

Depending on what you sell you are now in a position to have some sense of control on the aftermarket for your products. And, as we noted, your sales cycle has just become significant smaller, as have your inventories which create a cash flow and working capital burden.

The bottom line is that when you put together a customer finance vendor leasing program you are now in a position to customize it to your own firms needs. In the majority of situations you can even bundle in other services, installation, warranties, etc, and yes, no billing, collecting or credit - your firm is paid in full, on shipment and acceptance of your products and services.

Want to know more? Speak to a trusted, credible and experienced Canadian business financing advisor on why equpment financing works, 24 hrs a day, 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/vendor_leasing_program_equipment_financing.html