ABL Financing . Recognize Early Warning Signs For The Need For A Canadian Asset Based Finance Business Credit Line?

Time for a Paradigm Shift In Business Credit Line Thinking?

Information on ABL financing in Canada. How business owners can spot trends in the need for an asset based finance business credit line



ABL Financing in Canada. How do you know when it just might be time to both discover and utilize one of Canada's best financing mechanisms for a business? There are in fact some strong signals and warning signs when it comes to switching to an asset based finance business credit line.

It kind of sneaked up on us, but asset based finance is growing and becoming more popular everyday in Canada as a business finance mechanism. While banks and other lending institutions focus on cash flow and ratios and covenants the asset based line of credit lender sits quietly in the corner and focuses just on one thing- ' Assets '!

We're going to discuss how you can recognize some key early warning mechanisms around when to consider this method of finance, but the simple rule of thumb is that you have to have assets such as accounts receivables, inventories, lien free fixed assets, and even real estate... well lets just stay... you qualify! That’s why wholesalers, retail organizations, and manufacturers and service companies of all types are gravitating to ABL finance.

We're always surprised when we hear clients say they haven’t even heard of ABL. More so when you consider some of the largest companies in Canada have abandoned bank facilities and moved to ABL. While for the larger company asset based finance business credit lines can in fact cost less and be more flexible, the reality is that for the small to mid size sector the cost of such a facility will in fact be more than bank credit. But, consider this, if you don’t qualify for the amount of bank financing you need that lower interest rate doesn't mean much when you're forced to restrict growth and focus almost all day on managing cash flow in an often crisis type mode. That's when reasonable financing costs should be the least of your problems.

Let's get back to some of those early warning signs that just might signify your need to check out a new paradigm in business lines of credit. Sales revenue has a direct relationship to working capital needs. Because those higher sales and growth opportunities bring higher levels of receivables and inventory and of course higher levels of payables.

Velocity, aka ' speed'. It not becomes a greater challenge to turnover assets to generate that working capital. It's up to the Canadian business owner and financial manager to, as you're growing establish what is acceptable in inventory levels, A/R collection days, as well as, oh yes, paying those suppliers.

Two ways for you to monitor your financial cash flow and working capital needs over time are to keep a simple track of working capital to sales and working capital turnover itself. The former is calculated simply by taking your current assets and dividing them by sales for, say, an annual period. Working capital turnover is measured by taking you sales and dividing them by your working capital for any period. You then track those!

Let's say you kept track of your working capital turnover and notice the ratio is trending lower. That means poor working capital performance, and you probably are feeling this via cash flow pressures.

When you utilize an ABL Financing facility you will find those assets can be monetized faster, with more liquidity in margining, resulting in higher borrowing power for working capital needs.

Speak to a trusted, credible and experienced Canadian business financing advisor when you feel your firm just might be exhibiting signs of a need for a better way in a Canadian business credit line via asset based finance.




7 PARK AVENUE FINANCIAL

ASSET BASED LINE OF CREDIT EXPERTISE







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/abl_financing_asset_based_finance_business_credit.html

Getting Business Working Capital Financing Right . Ideas ,Tips And Solutions For Cash Flow Finance In Canada

Addressing Cash Flow Inside and Outside Your Business!

Information on sources of working capital financing in Canada and how to measure and asses your cash flow finance needs .



Is there life after business working capital financing and cash flow runs out? It's unthinkable but the reality is that business failure looms in the horizon when companies in Canada (and everywhere else by the way)run out of cash , or improperly manage asset accounts.

So how do you cope with cash flow challenges and what does the Canadian business owner and financial manager need to do to address this financing challenge.

As a starter, whether business people like it or not (certainly owners and financial managers) you have to have a grasp on your overall liquidity situation. This essentially becomes a matter of relationships , understanding how the relation of your current assets ( receivables, inventory , cash on hand ) are relevant to your cash flow success.

Not every analysis of some of these relationships is going to be relative to your firm all the time. The reality is that different industries have different financial profiles and it becomes a case of understanding where your company fits into the industry profile. And by the way, we never met a client yet who didn't think their firm was a bit different!

When you look at cash flow solutions you're looking at really two areas of focus, one is the overall solvency of your firm, and secondly the amount of risk you're prepared to take in making investments, taking on debt, and growing their company.

That's of course the inner view. The outer view is from lenders and suppliers, who are looking inside your company relative to your debt paying capability and your overall financial health, now and somewhat into the future. They have a vested interest in doing that based on what products of services they are supplying. And lenders don't even get us started on that...! The bottom line is they are looking to get repaid!

So business working capital financing then becomes a measure of looking at your balance sheet, i.e. your company resources... and addressing the various types of assets you have and how to monetize them to meet your operational goals. Any look into your balance sheet is a 'static one’... it's where you are at one place in time .It basically reflects how you're performing today. That income and cash flow statement basically show you how you got there.

So it's therefore important to understand some of those structural relationships when addressing cash flow financing.

In Canada your choices for working capital financing are one, or a combination of the following - receivable financing, sale leaseback financing, inventory financing, cash flow term loans, and bank and asset based lines of credit.

Which one of the above makes sense for your firm and how do you satisfy those working capital objectives? Speak to a trusted, credible and experienced Canadian business financing advisor today on how to best meet your business finance needs for growth and operational survival.




7 PARK AVENUE FINANCIAL
CANADIAN WORKING CAPITAL AND CASH FLOW FINANCING EXPERTISE



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_working_capital_financing_cash_flow.html

Finance Software? Computers ? Little Known Facts on Computer And Telecom Asset Financing

Leasing and Financing Your Tech Assets


Information for Canadian firms wishing to finance software and computers . The right computer and technology financing can be critical to your firms growth and success




Finance Software? Yes you can. Financing computer and telecom assets? Yes ... you should!

Never has the challenge and importance of financing your needs for Information Technology, software services, and telecom assets been more important. Safe to say also that it's a bit of a minefield around properly acquiring those assets. One of the reasons is that quite simply those needs change over time... and, oh yes, they tend to cost a lot more often than not!

As we seem well out of the collapse of the financial markets in 2008 -2009 (we kind of hope/think!) the importance, and access to that capital and those creative solutions seem once again at the head of the table, so to speak.

More sophisticated corporations tend to call it the ' technology sales cycle ', while companies in the Small to medium Enterprise sector in Canada simply call it a ' financial need '!

As you can see, we have a theme going here, and its basically you not only have to know ' what to buy” ... that's your problem, but from who to buy it from and finance it ... and that's where we can shed some light on some of those ' little known tricks ' we've mentioned. And when you master some of those tricks you quite clearly will be achieving a better ROI, as well as the cash flow conservation and budgetary pressures that come with investment in technology assets.

The whole concept of financing tech revolves around one basic premise - you want to be able to acquire the technology you need and at the same time be able to access flexibility, because boy do things change in tech!

So why should you consider the finance of software, computers, etc. Simply because it eases cash flow going out of your business. Many new innovative solutions also revolve around ' pay per use ' program. Quite simply the computer industry has taken the photo copier model and allowed you to pay for computing, printer and telecom power when you use it.

Don't forget to also investigate CLOUD and ASP solutions which also can save you tens perhaps hundreds of thousands of dollars in computer hardware investment.

So let's get back to a couple of those tricks of the trade. Cash conservation is one of them, so don’t forget to explore all options when it comes to staggered or flexible payments, and even operating leases which years ago were the ultimate in optimal tech financing - perhaps less so now because of accounting changes, but they are still a cash flow conservations strategy.

When you're budgeting for technology assets don’t forget to keep in mind the total solution, and ensure that solution can be financed. That's when the bundling of software, installation, delivery, maintenance etc can again save you thousands of dollars in outflows of cash. And by the way, one of the premises of leasing anything is the old maxim - ' IF IT APPRECIATES, BUY IT, IF IT DEPRECIATES FINANCE IT. Could any saying be more applicable in computer financing? As a business owner you want to be able to match the productivity benefits with your payments - over time. It's as simple as that.

Canadian business owners and financial managers sometimes have a fear of being ' locked in' to a particular vendor or product. The financing of that technology allows you upgrade and change flexibility to somewhat to a certain degree eliminate the whole issue of obsolescence.

Matching your financing solution and source to computer financing needs is important. If you want to explore those ' tricks of the trade ' and little known facts on methods of financing tech assets speak to a trusted, credible and experienced Canadian business financing advisor .





7 PARK AVENUE FINANCIAL
CANADIAN TECHNOLOGY FINANCING EXPERTISE



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/finance_software_computer_financing_computers.html

Don’t Utilize Receivable Finance .. Until You’re Read This . Mastering Tricks Of The Trade In Business AR Financing

How Much Do You Really Know About A/R Financing In Canada?

Information on understanding how business ar financing works and how receivable finance is priced .





Receivable finance in Canada. The business battlefield is littered with firms who either don't understand business AR financing from a pricing or a mechanics perspective, or, heaven forbid, have hooked themselves up with the wrong partner firm.

It's that proverbial fork in the road, and let's assumes the Canadian business owner or financial manager has taken it - he or she has opted to solve cash flow problems that have hampered growth and entered into an invoice financing facility.

But were the costs of the facility properly addressed, and are you working with the right lender ?Those two issues alone , when properly solved, or addressed, give you working capital and cash flow piece of mind.

You can make a huge mistake in receivable finance in Canada by not taking a bit of time to, as we say ' peel back the onion ' and ensure you understand that cash costs and mechanics of business AR financing.

So what issues should you consider when picking the right finance firm for your AR financing? Just like any other business or consumer contract you might look at you'll find that you need to address ' the fine print ', which typically isn’t the favorite thing we like to do, right?

Some of those miscellaneous charges can add up- for example some finance firms might want you to guarantee a minimum amount of financing business during any period - that might be a month, quarter, etc. A fee might be assessed if you have lower turnover.

The actual ' interest ' or financing charge is a subject of great discussion when we talk to clients about A/R finance. In general terms the amount of financing you do, the quality of your customer base, and to a certain degree the overall financial strength of your firm play a key role in pricing.

But business owners will find that the industry does in fact place a huge amount of importance on your A/R portfolio itself, not your own firms general credit worthiness. And that’s a good thing.

Also watch for the miscellaneous items that can add up, they include wire transfer charges, service fees, admin fees, - OMG it's almost as if we're banking in Canada !

If you're dealing with the right firm you'll find that you can finance all your Canadian and U.S. receivables without any issue. We do point out to clients though that if your receivables have a foreign component you may require some sort of credit insurance - which by the way isn’t a bad thing anyway.

In a perfect world you want to be able to move either to another A/R finance firm, or to a bank or other lender without penalty. Customers have a bit more negotiating power than they know when addressing this issue, and it should clearly be discussed up front at the time of entering into the facility.

Finally, make sure you understand the differences between a bank facility, a working capital term loan, and invoice financing, aka ' Receivable Finance '. The characteristics of a business AR financing facility are different - it's not a loan, it’s not a collateralized facility such as with a bank, it’s simply the ongoing sale of your invoice sales as you generate them, with the option of financing which sales you wish when you wish. It's simple as that.

Oh and by the way, we’re all for minding our own business, so be sure to consider a facility that allows you to bill and collect your own a/r without notification to suppliers, clients , etc . It’s our absolute recommended facility .

So is this method of Canadian business financing the answer to your current and future cash flow problems? As we said, it can be, if you take some time to master some of those tricks of the trade.

Speak to a trusted, credible and experienced Canadian business financing advisor today on how you can best understand and utilized business AR financing.





7 PARK AVENUE FINANCIAL
Canadian A/R Business Financing Expertise






Stan Prokop - founder of 7 Park Avenue Financial –

http://www.7parkavenuefinancial.com

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


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

Looking For Help For A Business Financing Acquisition In Canada ? Managing Mergers With Finance Solutions That Make Sense.

Looking for Merger or Acquisition Financing?

Information on financing mergers and acquisition situations in Canada . M&A business finance solutions.


Financing an acquisition in Canada. Or is it a Merger that needs a solid business financing solution? There are probably a good handful of technical or financial differences around the differences between a merger and an acquisition, and we of course all know it’s rare that you would have a perfect alignment of the planets - two companies that have identical business, equal asset strength, and income statements that are perfectly complimentary. That's the perfect world.

But Canadian business owners know it's not a perfect world and that such ' perfect storm' scenarios exist.

We can also make the case that years ago mergers and acquisitions were financed on the basis of asset values. These days it's safe to say there are lot of goodwill and analysis of future cash flows that play a large part in the total financing equation.

When we meet clients and talk to them about their M&A needs a few basic reasons always emerge as to some essential deal basics? In some cases the firm being acquired might be in somewhat of a 'death spiral ' due to mismanagement or its inability to wrestle with present economics. Heaven forbid, but we also even see crisis type situations.

Other scenarios that are part of the M&A profile includes owners ' cashing in' , family business scenarios, and growth opportunities that can't be realized by a firm without additional help, or financing.

So what do you need to consider when it comes to financing that acquisition or merger? It's important to understand both your internal and external resources, and to ensure you understand the different options you might need to complete an appropriate financing. We say ' appropriate ' because we often seen mergers and acquisition financing that have been the solution, but far from the right one.

This is exactly the right time you should be looking at your team - which might include a Canadian business financing advisor, your lawyer, accountant, etc. Here's where issues that might seem over technical to non financial types can hopefully be clarified in a common sense manner. They might include goodwill valuation, deprecation policies, asset valuations, etc.

Although you need financing for the merger it’s also important to understand what the borrowing capabilities will be for the new entity, and what form they might take. Solutions such as asset based lending, the gov’t CSBF loan, subordinated debt, and vendor take backs can all play a key part in a successful acquisition financing. It's precisely at this point that issues such as leverage can make or break ongoing business success. Putting one ' over - borrowed' company together with another leads to... well... you know... business failure.

For help in managing thru and completing an acquisition or merger speak to a trusted, credible and experienced Canadian business financing advisor.





7 PARK AVENUE FINANCIAL
CANADIAN BUSINESS ACQUISITION FINANCING



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_acquisition_finance_mergers_business.html

This Just In! Get Rid Of Franchise Finance Fear Once And For All . Financing Franchising Opportunity In Canada

Financing A Franchise In Canada – Don’t let fear of the unknown stop you now!

Information on franchise finance in Canada . How the Franchisee can overcome fear of financing franchising opportunity with the right info and strategy .




Franchise finance in Canada. The good news is that when it comes to financing franchising opportunity in Canada there are some proven methods for removing the ' fear ' or concern about not being approved for the purchase finance of your new business.

At the core of every successful franchise finance transaction in Canada is a solid business plan. And although you use this plan for financing the reality of it is that it has a lot of other value also. Most franchisors that have credible organizations in Canada, or who are U.S. owned can in fact provide you with some solid general assistance in the area of what should be in that plan .

Also, don't be fazed about the cost or time involved in putting together such a plan if you don't have a financial background. The cost of a crisp decent plan is in fact quite moderate and one can be completed in a relatively short period of time.

We find a lot of prospective franchisees have talked a lot about buying the franchise, and how much money they will make, while at the same time haven’t discussed the franchisors experience in their network of units in Canada when it comes to financing their stores. Oh, and by the way, we're even more surprised by many franchisors who don’t qualify their franchisees with respect to general credit worthiness, or net worth or business experience, but that’s another topic for another day. It would appear to us that if you're a franchisor you're only as strong as your weakest link!

Many franchisees in Canada have a fear of financing approval simply because they don't understand their options. There are only 4 options in Canada, and if you arent aware of all of them then we can certainly commiserate with you when it comes to being doubtful for financing success.

Oh, and what about those 4 methods. They are as follows:

You can self fund the entire transaction - not recommended, but if you can we're jealous!

You can use the vehicle in which thousands of franchises are financed - the Canadian government BIL/CSBF program

You can fund via a specialized commercial finance firm that specializes solely in financing franchising opportunities with well known franchisors

You can use a combination of any of the above scenarios and compliment that with equipment financing, merchant financing, or a traditional working capital term loan.

The key to a successful transaction is pretty simple, and it will remove all your fears if done properly. It’s to understand the level of personal financial commitment that you can bring to the table, along with planning venture with a proper business plan, and finally, soliciting the help of an experienced, trusted and credible Canadian business financing advisor who can assist you with the steps involved.




7 PARK AVENUE FINANCIAL

CANADIAN FRANCHISE FINANCING EXPERTISE





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/franchise_finance_financing_franchising.html

Is ABL Financing The Radical Change You Need In An Asset Based Credit Line For Your Business

The Canadian Asset Based Business Credit Line


Information on ABL financing in Canada . Why is the asset based business credit line a game changer for Canadian business .




ABL Financing is a ' game changer '. Let's take a look at some of the reasons why and the background around the business asset based credit facility.

If you're the financial manager or business owner of any sized business in Canada it would appear you're more often than not searching for working capital. The assets in your business can offer that flexibility when they are turned into a business line of credit facility that the financial folks term an ' ABL '.

The good news is that more and more firms in Canada, everyday, discover that the flexibility provided by this financing arrangement. When Canadian firms can't find a suitable traditional bank lending arrangement for working capital needs ABL emerges as a solid solution of choice.


All your firm needs with respect to qualifying for such a facility is any mix of accounts receivables, inventories, equipment or real estate. A typical ABL facility is a combo of 2 or more of these asset categories. The asset based credit line in fact gives the business increased borrowing flexibility versus a cash flow based solution from, for example, a bank .

Why is that? It couldn’t be simpler, in that assets such as receivable and inventory are margined at higher values than they are with the Canadian chartered bank offering. Again, its collateral, not ratios and covenants that count when it comes to an asset based credit line.

Is there a quick way for the Canadian business owner to rationalize a move to ABL? While no financing methods is always perfect , all the time the appeal of ABL is that it does not really focus on covenants - really the only thing that drives borrowing is the overall liquidity of your assets, whether you are growing or not.

Another key positive is that an asset based line of credit can pretty well increase automatically as your business grows - That’s because your assets would tend to grow at the same time.

We've said no single method of business working capital financing is the panacea of perfection. So business owners should realize that Asset based credit typically involves more month end reporting on those assets.

And while most asset based credit lines cost more than bank financing they can, on occasion be actually cheaper.

The ABL market in Canada consists of a fragmented bunch of firms, some niche based and Canadian owned, while others are divisions or subsidiaries of U.S. banks and mega corporations. The industry services companies of all size, from start ups to major corporations. It should come as no surprise that some of the largest and well known corporations in Canada and the U.S. use ABL financing so don't feel you are doing missionary work in business financing! ABL is here and it just might be the radical ' game changer ' when it comes to financing your firm.

Speak to a trusted, credible and experienced Canadian business financing advisor on how asset based credit lines can fund your daily operations, acquisitions, and growth.







7 PARK AVENUE FINANCIAL
IS AN EXPERT IN CANADIAN ASSET BASED
LINES OF CREDIT




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/abl_financing_asset_based_credit_line_business.html