Buying And Financing A Business Purchase With An SBL Government Loan In Canada

Let Your Business Purchase Put You On The Road To Richistan !


OVERVIEW – Information on the buying and financing of a business purchase in Canada using a SBL government loan strategy. A Hands On How To!




At some point in time many business people have the opportunity to purchase a business in Canada. That’s buying a business, not starting one by the way!

But financing the business purchase, i.e. putting your transaction together is another story. Here's one great way to do it if you business fits some basic criteria, and it’s via the SBL government loan. Finally, some help from Ottawa, but we digress...


There are of course the obvious advantages to buying versus building a business. First of all it's easier to find if you know what you are looking for, and many of the challenges of starting a business are immediately eliminated when you have a turnkey operation already in place. Finding premises, buying and financing assets, and generating revenues with a sales / operating team are instantly removed. Not that we're making anything too easy.

Oh and buy the way when we think in turnkey, we often think franchises, and to make it perfectly clear our strategy today also covers existing franchises, or corporate stores owned by the franchisor .

Getting a clear look and quick access to the business financials, but no matter how good, or bad... those financials look it’s a case of also trying to understand the motivation of the seller. Things like a financial tool called the VTB... the vendor take back can often play a key role in our financing strategy today and the proverbial ' motivated seller ‘ is often ok with a vendor take back . (If not, he or she is probably willing to negotiate price a bit more?!)

When you utilize the government SBL business loan for a business financing strategy in Canada you need access to those financials. They will tell us what assets are in the business, and by the way, it’s difficult, if not impossible to finance a smaller concern when there is a huge ' goodwill ' component in the final purchase price.

Although the income statement is important in our financing strategy via the SBL loan it’s not the deal breaker. However clearly you do want to know that the business is generating sales, that’s growing sales, and profits. If not the business can still be financed, don't despair, but you better have an action plan in place for that missing sales and profit strategy!

Getting back to the balance sheet, that’s key today in our finance strategy of buying a business in Canada. Here's where the SBL government loan comes into place. That’s because it finances the current and fixed assets of the business, as well as existing leaseholds. Leaseholds?

Yes, the government loan financing via the BIL/CSBF program finances those three asset categories - fixed assets, receivables as a portion of the current assets, and leaseholds. A qualified appraisal of these is required and the SBL program finances a total of $350,000.00 of these assets. A down payment or equity injection by yourself, as well as perhaps our previously mentioned vendor take back can get you often pretty close to a 1/2 Million dollar financing for your business purchase.

So, is that a creative strategy? We think its closer to a common sense strategy, and one that comes with great rates, terms, and structures, including limited personal guarantees and flexible repayment options that include repayment without penalty.

Buying and financing that business purchase via the SBL loan is a solid way to become a Canadian entrepreneur. Speak to a trusted, credible and experienced Canadian business financing advisor to kick start your business purchase.

7 PARK AVENUE FINANCIAL
CANADIAN BUSINESS PURCHASE 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/buying_business_financing_purchase_government_loan.html

When Do You Need AR Financing And Is It Really That Simple And Effective ? Factoring In Canada

Looking To ‘ Cash Flow’ Your Largest Asset ?



Information on factoring in Canada, Why AR ( a/r ) Financing Works, and how it works!.. in Canada



No secret that Canadian business owners and financial managers in the SME (small / medium enterprise) sector in Canada are constantly seeking simple and effective business financing solutions in Canada. That's where AR financing comes in – it’s assistance for the constant need for cash flow.

We don’t think we can count the number of clients we meet that always bemoan the lack of cash to run their business. And borrowing via some sort of term debt solutions isn’t exactly what they consider a solution.

Enter ' FACTORING '. In the right circumstances (more about that later) its time efficient and not really any sort of complicated approval process. The fundamental solution it provides is very simple - your clients owe you money but you would rather have that funding... today!

Although conceptually its similar to a business bank line of credit the difference is that the documentation surrounding this Canadian business financing solutions essentially has you selling those receivables, not just ' borrowing ' against them, as you would with a chartered bank in Canada.

You get the funds immediately, basically you’re able to cash flow the receivable as soon as you generate it and are able to document that you have delivered your product or service.

So how does the actual cash flowing of the invoice work. Let’s take an example of a $ 50,000.00 invoice as an example! As soon as you have issued that invoice you receive cash for the invoice, less a discount, which is typically in the 2% range in Canada, sometimes more... sometime less.

Our style is not to complicate things, but in actuality usually an additional 10% is held back as a reserve, or holdback. That money comes directly back to you when you client pays. So at the end of the day all you have in effect ' paid for ' is the invoice discount, the previously mentioned 2% range.

That seems very simply, but typical client questions are:

Why does the discount or financing cost change or vary?

Does the quality of my A/R portfolio affect pricing?

What if my client pays doesnt exactly pay on time?

Good questions ... here are the answers:

Financing costs vary based on the type of firm you are dealing with and the size of your monthly receivables, In general your firm can attract better pricing with a higher quality customer base, but this is certainly never always the case. And finally, we haven’t really met anyone that ' pays on time ' these days when cash is valuable. So the factoring industry addresses this by charging a daily ‘per diem ‘rate based on what one additional day of the overall financing cost we have referred to.

So why is this form of financing effective? Simply speaking it’s your new cash flow and working capital solution, allow you to finance receivables and inventory and grow your business. It's no secret that cash flow runs every small business and every FINANCIAL POST 100 firm in Canada. Factoring, aka ' RECEIVABLE FINANCING “helps you smooth out the ups and downs of the business cycle ... effectively.

7 PARK AVENUE FINANCIAL
CANADIAN FACTORING AND A/R FINANCE 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/factoring_ar_financing_canada.html

Your Futile Search For Government Business Loans Ends Here. The Canadian Govt SBL Loan Navigated ….Perfectly!

Real World Financial Help For Gov’t SBL Loans


Information on the government business loans in Canada. Let the SBL govt loan put your business on solid footing.



It's over. No... Really it is. That somewhat futile search for what you have been looking for - government business loans. We're going to take you from the world of government websites (boy are they jam packed) to the real world of the SBL govt loan.

The real world is where we toil everyday and we'll share key info and advice on what thousands of firms such as yours look for additional financing not available elsewhere.

The trick is how to get that loan, and its approval through a process of qualification and documentation. We'll focus on three basic areas -

1. Why is this program such a great option?

2. Where exactly do you get this loan - that... in spite of the government websites! is still a mystery to many

3. What do you need to both apply and get approved?


Taking the guesswork out of the SBL govt loan process is where you want to be, right? So why is it worth the time to spend on this great business financing option? The reality is that you're in a large group, that’s the tens of thousands of businesses in Canada our SBL program deems as small.

That brings us to the definition of ' small ' which in the case of government business loans is under 5 Million dollars. Oh, and by the way that ranges from start up with zero revenues to actual sales, annually under 5 Million dollars.
It's of course firms such as yours that employ people, and represent a mega huge portion of Canada's economy. Thats in effect our answer to our above question #1 - obtaining financing is difficult for any business, any size, anytime... so for your firm to have access to a program that has great rates, structures and terms , with only a partial personal guarantee ... well, we think we have made our point!

So where do you get an SBL loan? In Canada this program is sponsored and administered from a regulation perspective the Industry Canada, a branch of our government. But the govt has arranged for your local Canadian chartered bank to run and finance the program, with a majority of the loan, in effect ' guaranteed ' to the bank... by the govt.

So, it’s as simple as that? Trucking down to your favorite local bank manager (are there even bank mangers these days ... i.e. the guy or lady that sits in the corner?) and applying?

Not so fast. Here's where reality hits the pavement. Although the program is available from every chartered bank, and even some credit unions not all banks love the program, some have changed the rules a teeny bit, and many don't employ staff who are both familiar with and are comfortable with putting the loan together .

And trust us... it’s not rocket science. We can't think of one aspect of government business loans that is really that different from any other type of business financing you may have applied for... other than ensuring you have paid and filed your personal income taxes. (Hey, it’s a ' Govt' loan!)

Program highlights?

Maximum borrowing of $350,000.00.

Great interest rates for the start up or established firm.

25% Personal guarantee only.

And by the way the program finances both assets and ‘leasehold improvements’. How good can it get?!


Looking for a fast track to the SBL govt loan? Speak to a trusted, credible and experienced Canadian business financing advisor who can get you from the 100 yard line to the goal line in a process that isn’t as hard as you thought.

7 PARK AVENUE FINANCIAL
CANADIAN SBL GOVERNMENT LOAN 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/government_business_loans_sbl_govt_loan.html

Don’t Make These Mortal Sins When Buying And Financing A Business Purchase Acquisition. Buy A Company Or Competitor .. The Right Way!

Looking for Cutting Edge Advice on Buying And Financing A Business

Information on buying financing a business purchase acquisition in Canada . Buy a company , even a competitor, the right way!



More and more Canadian business owners and managers are looking toward executing and financing a business purchase acquisition. Buying a company, even a competitor has become one way to succeed on a growth strategy. But when you buy a firm are there some secrets to both not overpaying as well as some solid advice on how to finance the acquisition? We think there are.

Naturally the big guys execute acquisitions and mergers almost every day, all day. Valuations, currency, and business politics and competition play a huge role in determining the success of those deals, which we read about everyday.

But how about your transaction in the small to medium size (SME) sector in Canada. How do you access the cash and finance mechanisms that make a transaction work?

Many clients we speak to are looking to maximize on what they feel are ' undervalued' firms, in some cases the company you may be looking at might be in dire straits.


Naturally there are reasons why your acquisition target is undervalued, or in those dire straits we talk about. The reality is that more often than not it’s not just the price or value that you have agreed on, but the post sale cash flow and operations of the acquisition that will make or break your deal.

Where can things many times go wrong is simply when you don't spend enough time on the financials or the careful financing of the purchase. And boy is you committing a grave mortal sin when you overpay for a deal. The concept of overpaying and then not being able to execute on your overall strategy now puts you in... You guessed it... dire straits.

So what are they key areas of ' sinning ' when you buy a firm, from a financial and financing perspective. Naturally, as we have said, valuation is important, as well as a careful study or what you could call ' risk areas'.

------>

Financing the transaction must have you taking a hard look at profits, cash flow, and how your final balance sheet will look. It's very important to focus in on what cash flow the new company will generate. This is when your new ' economies of scale kick in.

Three other key areas of focus are total new sales growth, what assets are needed in the new combined entity, and how working capital will be financed. This includes growth in receivables, inventories, etc.

Don't get caught in other misconceptions - the concept of 'diversifying ' can sometimes turn into a fiasco. Diversifying into a completely different industry can bring both danger and financial risk. And don't think you can rely totally on the acquired management team to totally achieve your goals. That is up to you and your team!

There you have it, some pitfalls... to avoid when you buy a company through some sort of merger or acquisition process. Speak to a trusted, credible and experienced Canadian business financing advisor for tips and solutions to buying and financing a business in Canada.

7 PARK AVENUE FINANCIAL
CANADIAN BUSINESS ACQUISITION 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/financing_business_purchase_acquisition_buying_buy.html

A Stunning Claim? You Made A Big Financing Mistake By Not Considering An ABL Lender! Asset Based Business Finance Works

Asset Based Financing In Canada


OVERVIEW – Information on asset based business financing in Canada . Should you consider an ABL lender for your operating line of credit needs ?



How dare us. Are we actually saying you, the Canadian business owner of financial manager don’t know how to run your business? Not really! Our point is that you in fact may have missed one of the most solid strategies out there today when it comes to business financing. Simply speaking, if you haven't look at an ABL lender for asset based finance business lines of credit, you just may be missing the boat.

We do think we can relate to the Canadian business owner though, because we're the first to acknowledge that refinancing your business, in good times or bad is both a challenge and concern to the owner/manager.

Whether you like it or not we often, in Canada, get our business trends from the U.S. (We’re not necessarily thanking them for the 2008 world wide implosion), and in the states asset based lending drives a huge amount of business financing. So, we should at least look into that, right?

When we talk to clients about asset based financing their business initial conversations focus on two areas - first of all a definition of the subject, and secondly where ABL fits.

In terms of our subject matter let’s get straight on definition. We're talking about what some call a ' comprehensive ' ABL, that is to say it is in fact one business financing revolving line of credit facility that lumps together receivables, inventory, fixed assets, and even real estate if your firm has got that, into the mix.

And where then does ABL fit? That’s the good news, as it fits... everywhere. This type of business financing facility can function as a business line of credit, it can be used to purchase another firm via the other firms asset base, and it is more often than not used to replace or pay out a bank facility when that isn’t working for the client . Bottom line, a true business catch all!

So who uses ABL? That’s probably one of the biggest surprises to clients when we put forth an ABL lender solution. Why? Because what form of finance can be used from start up to worlds largest corporation. Certainly none that we are aware of. Although not widely publicized, many of the world’s largest and most successful corporations utilize ABL as an alternative to traditional bank financing.

Cost is always a discussion point when you consider a new form of daily financing for your firm. Here you need some clarity, because asset based business credit lines are cheaper than bank facilities, and they are also more expensive. What drives your final cost is your over all credit worthiness, the size of the facility, and who you are dealing with. That's the quick answer to ' whets my rate '?

So what do you need to really consider when it comes to assessing a new business line of credit solution?

Some key areas to focus on / explore and discuss are:

What are the direct advantages of ABL? (More borrowing power)

Can both private and public companies use it? (Answer - yes!)

How does the facility operate on a daily basis different from a bank line - (it doesnt)

Does ABL deliver more cash to my business (yes, 99.999999% of the time?)


Speak to a trusted, credible and experienced Canadian business financing advisor on why this solution for daily financing of your company... works!

7 PARK AVENUE FINANCIAL
CANADIAN ABL ASSET BASED 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 9 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_lender_business_financing_asset_based.html

Got Cash Flow In The Cross Hairs? The Agony And Ecstasy of Working Capital And Lending Solutions In Canada !

It’s Changing Times In Canadian Business Finance!


Information on the lending solutions for cash flow and working capital challenges in Canadian business.



Has your firm got cash flow in the cross hairs?

For many Canadian business owners and financial managers its clear - something isn’t working. Business seems kind of back to usual after 2008-2009 collapses ( of everything) but the average SME business owner and financial manager finds they have less working capital and lending solutions available than they had in the past .

Industry experts point out that the actual access to business credit and cash flow solutions is more and more a great predictor of survival.

Naturally all banks and major finance firms have websites and advertisements that indicate they are providing more credit to great companies like yours. Sorry for the sarcasm...

It's no secret that lending standards are tighter than in the past, there are certainly not a lot of looser credit standards and criteria these days.

Here's a big irony - a large amount of businesses in Canada actually run their businesses on credit cards - both business, and... You guessed it, personal.

The one danger there of course is that the owner’s personal financial life is significantly mixed into the business. In general that's not a good thing. One study in the states indicated that business owners seem to squeeze about 5k of revenue out of every 1k they spend via business credit cards ... it could be worse we guess. All of a sudden that 0% interest rate on a new card must seem tempting we suppose.

In a perfect world (and we know it isn't) you want your company to be able to have enough cash for all your business needs, all the time. That’s of course where the imperfect world comes in.

What really happens is that you spend a lot of cash sometimes, and in those good months you receive a lot of cash from clients for goods and services delivered... For start up firms or companies with a lot of seasonality in their business it's even a rockier road.

If the business owner and financial manager tracks ' the numbers' over time he or she will find that at time when they have high inventories and receivables they are generally running out of much needed working capital / cash flow .

Here's a fundamental concept that every business needs to get a handle on : You can raise cash flow by drawing down all the cash you have in the bank, borrowing via lending solutions - short term or other wise , or raise additional owner equity . But you can’t keep doing any one of those all the time!! There needs to be a balance, and a strong look at why you are always running low on cash.

Is there a most recommended way to access cash flow? More often than not it’s an internal solution, reducing A/R and inventory and managing payables carefully.

Great lending solutions for your cash needs include:

Receivable financing

Inventory Finance

Supply chain / PO financing

Asset based busines credit lines

Chartered bank lines of credit

Monetizing tax credits

Speak to a trusted, credible and experienced Canadian business financing advisor who can assist you in your business financing needs.

7 PARK AVENUE FINANCIAL
CANADIAN 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/cash_flow_working_capital_lending_solutions.html

Resistance Is Futile! Experts Agree . Finance Leases And Equipment Loans Via Lease Financing

Canadian Equipment Finance – Here’s Why .. And How!


Information on finance leases in Canada . Asset acquisition via equipment loans and lease financing works .



Yes, in the case of Finance Leases in Canada resistance might be in fact futile, but unlike the movies where this term seems quite ominous it’s a fact that equipment loans and lease financing in Canada is in fact a valuable resource to Canadian business.

While many Canadian business owners and financial managers might view this form of finance as complex it sure doesnt have to be. Do you have to be an expert or have access to an expert to achieve the benefits of leasing? Yes, it sure helps, but it’s certainly not required. Your business needs to simply know all the advantages that come with this form of financing, and when you don't understand which advantages relate directly to your situation it’s difficult to benefit from the right decision.

Over the years we met hundreds of companies / business owners/managers who actually employ a lease strategy for equipment needs and probably overlook a lot of other positive aspects of this method of asset acquisition simply because they were uninformed, or misinformed .

What could be the reason for ignoring finance leases? One of them simply might be that from the outside it looks a bit overwhelming. Why? Because the decision to finance assets has a blend of legal documentation, financing and accounting inputs, as well as general common business sense!

Are we able to set out some sort of basic roadmap when it comes to this well used (80% of all business lease assets) Canadian business financing strategy? We think it’s possible.

First of all you have to know the general lessor market in Canada. Who are the players, and which ones should you focus on for your specific needs. In truth the market is quite segmented - there are larger Canadian and U.S. corporations doing business in Canada ... Canadian banks also participate, and then there are tens of independent commercial finance firms. These firms focus on different asset categories, and yes, even deal sizes. This is clearly a time when it sure helps to have an expert guiding you through the above maze.

Clients we talk to are, unfortunately focused on the implicit cost of the lease, in layman's language this equates to ' What's my rate?".

Documentation and addressing the previously mentioned tax and accounting issues in a lease are also critical to success and benefits achieved. Simply speaking, just choosing the right type of lease and lease structure, as well as whom to deal with can save you many thousands of dollars. We can't count the times a client has asked us to help them get out of lease transaction ( you basically can't) , or to help them in addressing a risk or cost issue associated with the wrong type of lease transaction they entered into . Knowing how your lease company profits (everyone is entitled to a reasonable profit for risk/reward, right?) alone allows you to better address those finance needs.

So, yes, according to our buddy DARTH VADER in Star Wars,

resistance might be futile, but the better plan of action is to embrace lease financing in Canada with a positive attitude toward achieving the best benefits and lowest risk based on your firms needs. Extra help? Speak to a trusted, credible and experienced Canadian business financing advisor who can ensure you're a ' deal maker ' when it comes to asset finance.

7 PARK AVENUE FINANCIAL
CANADIAN LEASE 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_leases_equipment_loans_lease_financing.html







Stan Prokop