Canadian Business Financing: Are You Making Best Use Of Equipment Leasing And Canadian Asset Finance ?

Canadian Business Financing: Are You Making Best Use Of Equipment Leasing And Canadian Asset Finance ?

Are You Making Best Use Of Equipment Leasing And Canadian Asset Finance ?

Maximize Canadian Business Financing With Lease and Asset Financing Options


Information on equipment leasing and finance in Canada . Why asset financing is logical solution to fixed asset acquisition




It's a simple question really... is your firm making the best use, and taking advantage of the use of equipment leasing and finance when it comes to asset acquisition?

Just the use of your owner and management time in sourcing solid lease finance solutions can sometimes sap your business strength! When you think of it there are probably about 5 key steps in equipment leasing and finance strategies you employ.

First of all you must decide on which solution works best for your firm, in the context of what’s available in the Canadian marketplace. Here there are a plethora of firms, many specializing in either specific assets or deal size.

Step # 2 is simply getting a ' package ' of relevant info together - that might include equipment quotes or invoices, as well as the financial information you might be required to provide that demonstrates that the deal ' cash flows' in the eyes of your lessor .

A challenge faced by most business owners is that asset finance lease approval is heavily focused on historical and present cash flow. If you don't have those then your transaction will have to be ' structured ' in some manner. That might mean a down payment, a shorter amortization, or additional collateral or guarantees.

Step 3 is the idea of presenting your package to a lessor that makes sense for your firm. Don't forget in Canada that the equipment finance marketplace is really broken down into 3 categories - small, medium and larger size transactions. Small in general might be termed as under 100k... mid we could say is up to the 500k range, and larger ticket transactions can be financed in the million of dollars if suitable credit and asset criteria is in place .

Complimenting these three asset lessors are of course captive firms who actually manufacture the product and then offer financing to your firm. The computer industry is a good example of this type of lessor - and by the way they offer the best rates, terms and structures given they are incented to approve your transaction, allowing them to make a sale at the same time!

Step 4 in our whole process is the negotiation process. Here you'll be asked to potentially provide more information and clarify what type of transaction works for you in the case of the asset category. Knowing the benefits, advantages and potential downside of capital or operating leases is key to your success at this point.

As you head into step # 4 remember that lessors in Canada have numerous ways to enhance their yield, at your expense. So understand some of the nuances of terms such payments in advance, or what the down payment or security deposit does to your pricing, and the lessor yield.
Companies with decent credit history have more negotiating power than they think, given that it’s currently a very competitive market in Canada when it comes to asset finance.

The last part of your transaction, our step # 4, is simply documentation and legal requirements around the transaction. This involves the lessors registration of collateral, waivers from any other secured creditors, etc.

If you're a Canadian business owner or financial manager that simply doesnt have the time to prepare information, negotiate, and then select from hundreds of capital sources in Canada for equipment finance then consider using the services of a trusted, credible an experienced Canadian business financing advisor . Just going through the whole 5 step process we have outlined sometimes becomes a job in and of itself - so consider some expert help when it’s available.







Stan Prokop - founder of 7 Park Avenue Financial –

http://www.7parkavenuefinancial.com

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

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

Where Cash Flow Factoring Fits In The Jungle Of Business Financing And Short Term AR Finance

What Cash Flow Strategy Fits Your Company Needs?



Information on AR factoring as a short term finance strategy for cash flow in Canada.




No shocking news to the business owner or financial manager... but it's a jungle out there when it comes to Canadian business financing!

A lot of options and a lot of confusion... right? So where exactly does cash flow factoring ... i.e. short term AR Financing fit into the picture. Let's try and clarify.

Fundamentally it’s not that complicated... but there is a a lot of misinformation out there about pricing and daily mechanics... so lets clarify.

Essentially you are borrowing against receivables. Easy to understand so far, right? There are different reason why clients we talk to consider this option. For some its really basic... they want to eliminate themselves from the whole process of credit and collections.

For others it's simply a case of being unable to access traditional financing, or even better traditional financing in the amount they need. That applies very specifically to companies in high growth mode, or perhaps they are even a start up.

By selling your receivables to a third party, typically a commercial finance firm, you receive immediate cash and your facility is repaid as those receivables are collected.

In a perfect world you want to keep / retain the rights to the servicing and collections of that AR... your firm wants to be in a position to collect and service and liaise with your valued clients. There is a way to do that in Canadian receivable finance.

The whole process of a short term factoring strategy is pretty fundamental - you simply sell something for less than it's worth. In this case it's the receivable Using a $100,000.00 receivable as an example you invoice the client as soon as your firm has performed its product shipment or service - and you receive , that same day approximately $90,000.00 . You receive the other 10k, less financing costs, when your client pays... and typically that discount is approx 2 per cent if you are billing on a 30 day period.

The Canadian business owner and financial manager quickly realizes that if your customer is paying relatively promptly you have just created your own large cash flow machine.

So the biggest advantage to factoring in Canada is simply ' immediate access to cash ‘. You do have that financing charge , but surely you haven’t forgotten Business Finance 101 that says that you are in fact incurring costs to carry that receivable already .. And if you had the cash the same day you invoiced you would be in a position to buy more and sell more, generating even further profits instead of wafting 1-3 months to collect that AR!

Shorter term financing via an AR Cash flow strategy can also include that ' confidential ' component we discussed - allowing you to bill and collect your own receivables without notice to any client, supply, other lender, etc. Typically you can't have both a bank and factor strategy in place, but the reality is that many clients simply can't access bank finance, so they gravitate to cash flow factoring.

Speak to a trusted, credible and experienced Canadian business financing advisor on clearing up the ' jungle ' of Canadian business financing when it comes to a cash flow 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/short_term_finance_factoiring_ar_cash_flow.html

Fixing 3 ( More ) Parasites Of Business Cash Flow . Solutions For Management Financing Challenges In Canada

Power Up Business Cash With These Solutions and Tools!


Information on business cash flow . Fixing management financing challenges so your firm never runs out of cash and working capital .



Parasites of Business cash flow in Canada. We wrote recently on 2 specific parasites concerning management financing challenges for your business. They were, specifically, mismanagement of your cash flow cycle, and... Secondly, poor use of operating leverage.

That word parasite conjures up an image of a ' leech ‘...or ' sponge ‘. It seems somewhat appropriate then to perhaps address 3 more of those parasites of your business cash and working capital challenge.

We'll start with # 1, which is the concept of ' Financial Leverage '. A good way to think of that is that it’s the idea of how different types of financing affect you use affects your net profit. To finance your firm it always comes down to the fork in the crossroads - ie debt or equity. If your firm can pull off acquiring and managing as much debt as possible in a solid manner you naturally restrict outside ability to dilute your equity position.

Essentially that’s a good thing. The only problem is that your lenders want to get paid, either periodically or on a revolving basis. Ultimately its one of the most important ' big picture ' decisions you have to make in running and financing your business.

Potential parasite #2 in our analysis today is the concept of maturing debt. Along with that comes another business decision (boy, there seems to be a lot of important decisions to be addressed today!) which is the idea of taking on debt on either a short term or operating basis. You also don't want to be caught in the additional common situation of having to guess where interest rates must go

Potential parasite # 3 is the idea of current asset management. Here's where things can really go wrong, and generally speaking, fairly quickly.

Did you know that as a business owner and financial manager you have minute by minute access to one of the most powerful tools in business analysis... we think, in the world. Simply speaking, it’s the understanding and analysis of your ongoing receivables and inventory. Your ability to track sales and inventory should have bells going on in your head when things feel like they are going awry. Simply monitor over time your sales to receivables ratio, and in the case of inventory ensure your inventory isn't trending up when your sales are not!

The real ' quality ' of your profits / income is ultimately related to your management of these 3 potential parasites.

In Canada you can fix, eliminate, or control these parasites in a variety of ways. They include a term cash flow loan, receivable and inventory financing, true asset based lending facilities, or the monetization of tax credits such as the SR&ED credit.

Speak to a trusted, credible and experienced Canadian business financing advisor on how you can find and deliver on solutions to management financing challenges.



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_cash_flow_management_financing_challenges.html

Don’t Make These Blunders When Financing A Canadian Franchise . Franchising In Canada … Done Right!

Are You Doing The Right Things When It Comes To Franchise Financing In Canada?


Information on franchising in Canada. Financing a Canadian franchise requires not making certain costly mistakes



A blunder. We're told it's about ' acting blindly ‘... ‘without guidance'. Can you actually afford to make a blunder when it comes to financing a Canadian Franchise? Talk about a costly mistake.

Let’s examine some ways in which you can avoid making those serious mistakes when looking at franchising in Canada and the financing needed to complete that purchase. And by the way that includes buying a resale franchise, or of course a new ' turnkey ' operation.

It goes without saying that you need to do your homework in order to ensure that Murphy's Law doesnt kick in... ‘What can go wrong ... will '. We're also often asked if there is a difference in working with a Canadian franchisor as opposed to a U.S. founded organization. We certainly don't think so... and the reality is you may well be dealing with a Canadian master franchisee anyway. That's of course a Canadian or Canadian organization who has secured the U.S. rights for Canada.

Identifying the right amount of capital required for your business franchise is critical. That of course involves the initial franchise fee, as well as the amount then required to facilitate the entire purchase. That might include equipment, leaseholds, inventory, etc.

It's at this time that many potential Canadian franchisees make their first ' blunder ‘. They forget to consider longer term working capital. That’s the funds required to run their business on a daily basis, re operating costs. Remember that your business can't grow without a proper base of working capital.

And coming back to our debt and equity scenario, spend some time understanding how the right mix of personal investment and debt plays out relative to leverage, risk, depletion of personal resources, etc.

There is a danger in making a sizable non refundable deposit if in fact you are ultimately unable to complete financing for your Canadian franchise. And talk about a sinking feeling if you complete a transaction and ultimately find you are not suited to the nature of the business with respect to the personal satisfaction that comes from creating and growing your own business.

There is probably no better ' homework ' when it comes to a Canadian franchise opportunity than talking to other franchisees within the system you are considering - they might also provide valuable insights into how they financed their franchise and what obstacles you might need to overcome .

We're not so sure you can call it a blunder, but it's certainly an over expectation if you think your franchisor will provide or significantly help you with the financing of your purchase. In fact you might be surprised that it’s the federal government, via the CSBF program that in fact finances thousands of franchises in Canada. Avoiding blunders in making that program successful for yourself is a whole other subject.

Avoid those blunders we're talking about when assessing your options in franchising in Canada when it comes to selection and finance of your business.

Consider also speaking to a good franchise lawyer, accountant or Canadian business financing advisor who can assist you in eliminating costly mistakes and enhancing chances for success.








Stan Prokop - founder of 7 Park Avenue Financial –

http://www.7parkavenuefinancial.com

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

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

2 Signs Your Business Is Going Broke And Your Solutions For Fixing Business Cash Flow Problems

Solving Business Cash Flow Problems .. Today Or Before They Happen

Business Cash flow problems can be solved with the right info an Help . Solutions for business liquidity before you hit the wall!


Can you spot (or have you spotted already) business cash flow problems inside your firm? A better question might be - have you got some solutions to those problems! We've got some insights into both today.

Business failure, temporarily, (or otherwise!) often comes back to cash flow and working capital. In some cases it's an ongoing situation that saps management strength - at other times it's a time bomb inside your firm, seeming ready to explode at any time as you hit the proverbial cash flow shortage wall!

Your ability to perceive this challenge and correct it is of course critical.

Let's get to the meat of the matter... jumping right into the matter. Here are 2 key areas or reasons why you might be ' going broke ‘, and maybe not know why. The term ‘ going broke ‘ is a bit unsophisticated .. but anyway …here goes!
Your ongoing challenges might involve one of these, or both . We'll let you make the call.

Sign # 1- your cash flow cycle. Simply speaking it’s the relationship around the ' in’s and outs' of your business. It's the time cycle between collections and payables. We met with a CEO yesterday of a larger firm who commented that in his cash flow cycle they typically get paid by clients before suppliers are paid. They are in the food industry - and that would be typical. When that issue is reversed, i.e. suppliers needing to be paid before clients pay you face a cash flow cycle problem.

And by the way, you need the right mix of those ' current assets ' when it comes to turnover. When your a/r or inventories become ' bloated ' that's a sign of ' going broke '.

Sign # 2- Leverage. It's a common term that the business financial folks use. It's essentially the fixed costs in comparison to the profits you can earn from selling more. As you look to buying more assets, or even buying a competitor that leverage issue becomes critical. Buying more assets and taking on more fixed costs just puts more pressure on you to breakeven, let alone make a profit.

Too much leverage ultimately will lead to business failure.

Remember also that one of the biggest misconceptions in business is that profits aren't cash. Lenders in Canada generally aren't impressed by romantic, slick company names, high ambitions and future profits. They focus on cash flow and the quality of earnings - when you track income and cash flow over time they should gradually come together.

Our final advice - seek out the ' bad news ' in your cash flow problems - and understand where they are coming from.

Solutions in Canada are abundant - depending on where you are in the business maturity cycle - i.e. start up, growth, mature, etc. Those solutions include solid banking support, receivable and contract finance, inventory and P.O. finance solutions, and asset based lending and equipment finance.

Speak to a trusted, credible and experienced Canadian business financing advisor on how you can utilize these to... dare we say it... not go broke!



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_cash_flow_problems_solutions.html

How To Finance A Company In Canada .Mistakes You Don’t Want To Make In Cash Flow Financing

Looking For Traditional and Alternative Debt Financing Solutions In Canada

Information on how to finance a company in Canada . What cash flow financing alternatives are available to the Canadian business owner and financial manager ?




How To Finance A Company...that's the challenge for owners of new and existing businesses in Canada when it comes to equity, debt, and cash flow financing.

Let's examine some basic aspects surrounding that issue with a focus on how Canadian business owners and financial managers can both identify and then source capital. Our focus will be primarily outside of the equity arena as private and public entity is... well... a whole different kettle of fish.

Timing is of course... everything .. and it sure helps when you're financing a firm in an economy that is a bit healthier. Financing, both from a debt or cash flow point of view is of course the lifeblood of any firm. Great companies, both small and large go out of business due of course to inability to get the proper mix of financing in place.

As most business people know it’s not only a challenge to generate the interest of a financial partner - then it becomes the challenge of an approval securing those funds! And as your firm grows you will need additional cash flow financing - you don't want to be in a position of growing so much that you business fails - that has happened to many in Canada.

In Canada banks and other commercial financing firms provide the debt and cash flow financing capital you need Let's explore and recap some of those debt and cash flow financing options available

When most business owners think in terms of external financing they consider Canadian chartered banks as the key option. That is no doubt certainly the most publicly available finance - and when you have the corporate and personal assets and collateral the rates, terms and structure of the bank agreement is without a doubt appealing.

But in many cases the Canadian banking system can't support the thousands of firms who have additional or specialized needs. In the case of securing bank credit you need positive profits, assets and collateral, a track record and probably forms of what the banks call ' secondary repayment - Our clients know it as the ever concerning Personal Guarantee!

So, when you are looking s to how to finance a company what are some of those other options? They include asset based lenders; in the true sense of an ' ABL ' solution these firms provide non-bank lines of credit secured by your A/R, inventory, and fixed assets on the balance sheet. And a lot of the emphasis that banks place on approval do not come into play with an ABL lender.

Equipment financing, aka leasing your key assets is also a very effective method of financing your firm. It also relieves the larger cash outlays your business needs when it acquires assets.

Start up and small businesses have access to the Government SBL loan program, which has great rates, terms and structures when it comes to acquire assets and even financing leaseholds and real estate. And the majority of the loan is guaranteed to the bank by the Federal government.

Cash flow financing, or the ' monetizing of assets ' can be accomplished by utilizing receivable financing, inventory finance, and even selling your tax credits such as those under the SR&ED program . Why wait a half year to get your cheque from your non repayable tax credit?!

One of the best methods of cash flow financing comes your a partner you know only too well - yourself and your firm. By managing your assets such as inventory and A/R you can generate internal cash flow through your business operations.

Speak to a trusted, credible and experienced Canadian business financing advisor on those equity and debt options when it comes to how to finance a company in Canada.






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/how_to_finance_a_company_cash_flow_financing.html