AR Financing . Your Every Question Counts When It Comes To Receivable Factoring

Lost Your Operating Manual For Receivable Financing In Canada?



OVERVIEW – .Information on AR financing in Canada . When it comes to receivable factoring what does the Canadian business owner/manager need to know with respect to operating and benefiting from a successful cash flow strategy .




AR Financing in Canada. When clients we speak to think about receivable factoring solutions they tend to have more questions on this solution than some other types of financings. Why is that we thought? We're not 100% sure but we know those questions need to be answered. So our solution, a mini ' Operations Manual ' on A/R finance in Canada.

It's those operations manuals that provide us with ' how to ‘, dangers, warnings, recommendations, so it seemed quite appropriate to adopt that type of information delivery! Let's dig in.

Canadian business owners and financial managers utilize Receivable factoring for a variety of reasons - one main one being it provides your firm with working capital and cash flow without dilution of your ownership equity in the company. It is often viewed as a short term or intermediate finance solution, avoiding long term commitments and long term debt.

It differs from bank financing from a number of perspectives. When you finance you A/R with a bank you provide an assignment of those receivables that you're financing. When you utilizing an A/R finance scenario you simply bulk up on ' Cash On Hand ' as you are in a position to constantly ' sell' your A/R on an ongoing or bulge type basis .

Both factoring and bank receivable finance advances you a per cent age of the value of your sales. In the case of Canadian chartered banks it's a 75% advance; Receivable factoring typically provides you with a 90% advance, so you have more liquidity.

Does our ' Operations Manual ' of advice recommend any one type of AR financing over another. Ours does! It recommends that you consider Confidential A/R finance
which allows you to bill and collect your own accounts - there are no notices to customers, you are completely independent of your finance partner, and at the same time you have the same or better pricing with respect to limits and credit lines.

In effect you're in control. That ability of Canadian firms to run their own businesses without any ' negative ' client reaction from their customer base. That's a good thing! , when it comes to the somewhat more conservative Canadian landscape of business ' perceptions '.

Receivable financing in Canada is a sub set, we can say, of asset based financing... So in many cases your cash flow financing for your receivables can be combined with inventory of fixed asset financing, allowing you to truly ' bulk up ' on capital needs .

The security for your A/R financing is pretty well the same as that of any Canadian chartered bank. Typically its most easily accomplished with the same type of General Security Agreement that collateralizes the financing.

So does the concept of an ' Op's Manual ' when it comes to receivable factoring make sense. If you're concerned about ' how things work '. ‘dangers’ , 'recommendations', etc consider a LIVE operations manual by seeking out and speaking to a trusted, credible and experienced Canadian business financing advisor who can assist you with your cash flow needs.




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 10 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 :


7 Park Avenue Financial = Canadian Receivable Financing Expertise





7 Park Avenue Financial
South Sheridan Executive Centre
2910 South Sheridan Way
Suite 301
Oakville, Ontario
L6J 7J8
Phone = 905 829 2653
Fax = 905 829 2653
Email = sprokop@7parkavenuefinancial.com



















Stan Prokop

Financing Business Growth In Canada Celebrate Funding Awareness Day Every Day Of The Year

Financing ( GROW OP ) Business Growth And Operations !



OVERVIEW – Information for financing business growth in Canada . Funding Your Company requires appropriate debt and asset monetization knowledge



Financing business growth in Canada. Are you the type of business owner/manager that feels that you're not really celebrating ' Funding Awareness ' Day that often? Here's some information and solutions around that key subject. We suppose you say that we're sharing info on financing a Grow OP... Which of course means Growth and Operations. What did you think we were talking about?! Let's dig in.

Cash and Profits are two key goals for all business, whether you're a start up or a major corporation... But how do you get a sense of what amount and type of funding you need? That question covers our growth situation we're talking about, but is equally applicable for companies are experiencing some sort of level of financial distress or challenge.

But as far as growth is concerned, unless you're in a cash business that has not cost of goods it's a certainty that as your revenues grow you must bulk up, unfortunately, on the current assets part of your balance sheet - A/R, inventories. And don’t forget those fixed assets that either run your business or allow you to maintain competitiveness.

It's an interesting point that is sometimes forgotten that the one good thing about growth financing is that as your sales grow you get automatically more finance from vendors/suppliers

When you're sourcing finance options remember that fixed assets aren't growing. One solid strategy is to consider a sale leaseback of owned assets to enhance business growth cash flow. And here's a new one for most clients we talk to - fixed assets (that are owned) can be used for revolving credit purposes if you are willing to consider a non bank Asset based line of credit.

So what does the business owner do when ‘traditional’ bank financing is either exhausted, or simply not available? Businesses that don't require new assets, i.e. they have extra capacity already are in a better position than firms which require new assets. That’s where lease financing is a solid solution. You minimize capital outlay while obtaining and using assets that will generate future revenues and profits.

Firms that are start up, generally newer, or in the overall category of the SME (Small to Medium Enterprise) always seem to have more challenges. That's when some solid assistance in knowing how you can access non traditional capital when external funding sources are ' bleak ' is key. Some of those include:

Receivable Finance
Working Capital Lines Of Credit
Monetizing tax credits owing your firm (SR&ED, etc)

These strategies maintain your debt to equity ratio constant and help you manage growth.

We hesitate to say that the alternative to growth is to simply stop growing. Here your wont need extra capital but certainly limits profits and competitiveness. Seek out a trusted, credible and experienced Canadian business financing advisor who can assist you in celebrating Funding Awareness Day! for your Grow Op - the growth operation you call your 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 10 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 :

7 Park Avenue Financial = Business Growth Financing
















Stan Prokop

Business Finance Problems ? An Overdose Of Funding Solutions Might Be In Order

2 ½ Solutions For Successful Business Financing

OVERVIEW – .Information on solutions for business finance problems in Canada . Funding solutions will always come down to your assessment of traditional, alternative or internal methods of fixing financing challenges



Business finance problems in Canada? It's no secret to Canadian business owners and managers that the funding they need to solve those challenges all comes down to the overall borrowing quality of the firm. Banks and commercial lenders make it their business to in effect ' predict ' failure.

But what can the owner/manager do to ensure the right access to choices for loans and working capital and can the right type and amount of financing lead to the successful turnaround of your firms’ financing fortunes. Let's dig in!

A good way to look at things it to ensure that the type of financing you seek corrects the poor performance your company might be experiencing due specifically to lack of, or wrong financing. We speak to clients in terms of 2 1/2 solutions to funding challenges in Canada.

They can be broadly grouped into:

Traditional

Alternative

And the 1/2? That comes about by better knowledge and management of existing assets. That might include refinancing assets under a sale leaseback, or just common sense basics such as better receivable and inventory turnover.

Both owner/managers are also cautioned to ensure that the financials reflect the true value of their assets and liabilities. This allows you to look at your company in 4 different ways -

Immediate liquidity challenges

Debt structure

Operating Performance

Profitability

It could probably be debated, but ' liquidity ' is in fact the best predictor of immediate financial problems. Here it's all about the ' Current Assets' part of the balance sheet -how you manage those inventory turns, receivable days outstanding, etc.

Immediate solutions in this area include bank or non bank business lines of credit that are commensurate with your overall credit quality. Other solutions include Purchase order or contract financing, future revenue stream finance, and receivable sales programs typically achieved through a receivable discounting facility. All of these fall into one of two categories we have already mentioned, traditional, or alternative!

That's a nice segue into our next point , which is that those other 3 areas - debt, operational efficiency, and profits will in fact dictate whether you're better to explore traditional or non traditional Canadian business financing solutions .

When it comes to business finance the bank or commercial lenders you're working with will take a hard look at the financial performance history. However good commercial lenders tend to pride themselves on ' failure prediction '. That’s why it's important for the owner/manager/CFO/Controller etc has to ensure all the bases are covered in our 4 different ways we've offered above to assess your historical and current financial performance.

How do the right financing solutions then fix your business finance problems? Properly executed they will show there is a turnaround solution in place, and be able to fix financing challenges within a generally specific timeframe.

If you want to ensure you have the right fixes and solutions in place to support sales growth seek out and speak to a trusted, credible and experienced Canadian business financing advisor who can assist you in areas of traditional and alternative finance. They include:

Receivable financing
Inventory finance
Bank and Non Bank business lines of credit
Sale leasebacks
Tax Credit Monetization
Bridge Loans


P.S. Your take away? Focus on seeking expertise in the 2 1/2 ways of financing your funding needs - Traditional, Alternative, and... Internal!



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 10 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 :

7 Park Avenue Financial = Business Finance Problem Expertise













Stan Prokop

Business Finance Options. Not The Dark Secrets You Thought They Were When It Comes To Traditional Or Alternative Financing

Are Your Business Finance Options Out Of The Box .. Or In The Box ?

OVERVIEW – Information on business finance options in Canada. Business owners /managers must choose between traditional or alternative financing solutions that match their capital and growth needs



Business finance options in Canada. We constantly hear the term ' out of the box thinking ' these days, denoting some level of creativity . When it comes to alternative financing a number of solutions are available that are non traditional in nature.

However a number of these finance strategies get more and more traction every day. So yes, they are ‘out of the box ' to a certain degree, but we can guarantee you there are no 'dark secrets '. Let's dig in.

Let's take a look at some methods to finance your business that might be ' alternative ' in nature. Every successful business requires some level of owner equity. Many businesses are started by the use of personal assets which are monetized. We've said time and time again that it’s important to separate your business and personal life when it comes to finances.

So while selling or liquidating assets might be considered an ' alternative ' strategy the reality is that your personal resources become completed, they are at risk if there is a business failure and your all important personal credit history might unravel. So yes, it's important to commit equity to a business, combined with the right amount of debt. Ensure though that assets you're tapping are in the right amount and that will help attract the correct amount of debt financing you need.

Many businesses that can't be funded by banks are in fact eligible for bank financing! What do we mean by that -simply whether you consider it ' traditional' or ' alternative bank government guaranteed loans are a great way to finance fixed assets, leaseholds, technology requirements, etc. Bottom line - investigate the SBL program.

We constantly run into many businesses that are financed by credit cards. Here it's a double edged sword. Business credit is accessible - caution must be taken to use the right type of cards and to further ensure your personal credit history will not be tarnished by over use of credit.

Certain companies are great candidates for high net worth investors, many of whom are termed ' Angel' investors. They look for good opportunities with firms that have growth and profit potential. Many have experience in the industry you are in, which you benefit from via external expertise. The biggest challenge in Canada is finding Angel investors and understanding they will demand an ' equity ' or ownership role in your business.

Over the years we've worked with a number of clients who have utilized the capital pool or reverse take over option for new financing. Our own experience is that this often does not work, but done properly your firm is certainly more visible to the public and you have the opportunity to attract additional capital.

Many business owners and managers don’t realize they can bulk up on cash simply by selling accounts receivable. This process immediately monetizes A/R into cash, and although more expensive is much cheaper than giving up control and equity ownership. Receivable financing, done right is a solid alternative strategy used by thousands of corporations, large and small, everyday. Our recommended solution in this area is Confidential Receivable Financing , providing you with unlimited credit against your sales and allowing you to bill and collect from your own clients without any third part interference.

Heard of Royalty Finance? We rarely see clients use this method of financing, but it’s certainly up for consideration. It simply allows you to borrow against future sales which creates a win / win strategy for your investor/lender and allows you to avoid debt and grow your company.

Never forget that your suppliers/key vendors are great sources of capital. Just negotiating better payment terms creates business cash flow. In certain cases you might end up considering some sort of more strategic relationship which is of future benefit.

Traditional finance sources include:

Commercial bank lines
Asset based lines of Credit
Bridge Loans/ Sale Leasebacks
Tax Credit Monetization
Supply chain/PO finance

Which traditional or alternative business finance options will provide your company with the capital you need. Seek out and speak to a trusted, credible and experienced Canadian business financing advisor who can assist you with your capital needs.





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 :



7 Park Avenue Financial = Business Financing Options













Stan Prokop

Commercial Financing For Business Credit Lines . Is ABL A Revolutionary Way To View Operating Finance Needs

Looking To Get The Upper Hand When It Comes to A Business Credit Line?

Information on commercial financing in Canada . ABL borrowing is a viable alternative to bank business credit lines for firms that can’t always access the financing they need


Commercial financing for business credit lines. Is there a revolutionary new way to look at the way businesses in Canada can access operating credit? We know there is, and it’s the alternative to the good old stand by of bank commercial borrowing. It's called ' ABL ‘. Let's dig in.

ABL’s are asset based lines of credit that are typically ' non bank ' in nature. Some of the very reasons your firm might not be able to obtain bank financing are the same reasons you're the perfect candidate for a business credit line via ABL.

Non bank commercial entities offer asset based loans that operate in a very similar manner to bank revolving credit facilities. All these facilities monetize your current assets -typically A/R and inventory. The asset based credit line takes it two steps further:



1. It often includes fixed assets which increase your borrowing base, but the facility revolves in the same manner

2. Borrowing margins are significantly higher - Receivables typically financed at 90% - Inventory in the 30-70% range depending on quality and mix of the asset in question

Business owners who are growing or have their debt to equity and cash flow ratios temporarily out of whack are also very appropriate candidates for this method of financing. Dont get us wrong though - you still have to have qualified commercial receivables to decent clients, as well as inventory that have the appropriate amount of turnovers and can be liquidated by the asset based lender if needed. Hopefully that is never going to be the case though!

Asset based financing started in the United States, and is also prevalent in Europe. It continues to gain a strong foot hold in Canada, but clearly there are fewer players involved. This often makes it challenging for the Canadian business owner and manager to access the right partner . Some expertise in picking the right partner is highly recommended.

Clients often question us on minimum and maximums size of transactions for business credit lines that are non bank in nature. Typically $ 250,000 is the minimum, and all things being equal there is no upper borrowing limit if your firm has the assets to qualify.

Many businesses are pressured either via banks or other lenders or their equity investors to put additional equity into the company. ABL business credit allows you to eliminate the ' equity ' component of your overall financing strategy. As a result it’s good for larger retailers, tech firms, manufacturers, distributors, almost ever industry is a candidate.

Is it all ' apple pie and motherhood ' when it comes to ABL credit? Not all the time, as this method of financing is typically (not always) more expensive and you have to be prepared to report a bit more regularly on the assets being financed. That’s because they are the sole collateral for your borrowing! Debt to equity and cash flow coverage don't really play a role in this type of borrowing.

The average business owner, financial manager, CFO rarely feels they have the ‘upper hand ‘ when negotiating day to day credit facilities. Seek out and speak to a trusted, credible and experienced Canadian business financing advisor who can help you select between bank and ABL facilities in a manner that suits your company best.


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 :

7 Park Avenue Financial
South Sheridan Executive Centre
2910 South Sheridan Way
Suite 301
Oakville, Ontario
L6J 7J8
Phone = 905 829 2653
Fax = 905 829 2653

Email = sprokop@7parkavenuefinancial.com

7 Park Avenue Financial = Commercial Financing & Business Credit Line Expertise













Stan Prokop

Financing Sources In Canada. Eliminate Turbulence When It Comes To Canadian Business Financing

The Secret Science Of Business Finance Sources In Canada


Information on in Canada . Canadian business financing challenges can be eliminated when utilizing the right type of finance at the right time



Financing sources in Canada. Truth or Fiction? That's probably one of the feelings or comments some clients we meet have when it comes to Canadian business financing.

Let's get in behind some of those sources of finance for the commercial borrower and eliminate some of that turbulence.

Primarily we'll focus on what we could term ' intermediate ' sources of capital. These include trade credit from suppliers, banks, equipment lessors, A/R financiers, and inventory finance solution providers.

Occasionally the business owner /manger forgets to consider that supplier/vendor financing is one of the best and cheapest forms of capital and cash flow. Quite frankly it is much easier to obtain, is rarely, if ever ' secured' or ' collateralized ‘and typically carries no interest penalty

Don't forget though that while delaying payment to suppliers is a ' cash flow positive ' you never want to have that strategy deteriorate the relationship you have with a key vendor. Furthermore if your firm has the cash the cost of not taking a payment discount also must be measured.

Just a quick example on the whole issues of prompt payment. You can check with your accountant but let’s say you bought 10k of product from a supplier and were able to successfully negotiate a 2% NET 60 payment term.

If you calculate your discount foregone and the proceeds from the use of the money you might find that’s an 18% savings rate -so if you can borrow for less than that you clearly are ahead of the game. Bottom line - don't underestimate the power of supplier financing from a payment and cash flow perspective.

Banks are of course the business owner/manger ' go to ' when it comes to financing sources under consideration. However unsecured loans for business, while available, will rarely give you company all the funding you require. Business lines of credit from banks are low cost and flexible - they simply require appropriate bank collateral and the understanding from yourself that there might be some restrictions on your financials re additional borrowing from others, etc. If your company meets cash flow and ratio requirements from banks they are an excellent source of intermediate term capital for loans on equipment, fixed assets, etc.

A/R financing is becoming increasingly popular in Canadian business financing. Why? Simply because it can provide significant capital without additional equity and allows you to avoid long term debt. It has a higher cost, and we also spend a lot of time in speaking to clients around the fact that the old stigma of A/R factoring disappears more and more every day. The old alternative is fast becoming the new traditional.

Other benefits of A/R finance include immediate cash flow and the ability to handle seasonal bulges in your business.

Inventory financing is typically done in combination with a bank line of credit or non bank asset based line of credit. Good inventory financing is available if your firm has quality products; good inventory turns, and is not of a perishable type - i.e. food.

Equipment financing is a solid use of intermediate financing. It allows you to avoid large cash outlays, replenish assets and technology, is easier to obtain from a financing approval point of view, and allows you to simply pay for assets over their useful economic life.

Our bottom line? You can eliminate the turbulence that comes with business finance challenges by understanding what sources are available for what maturity and need. Simple as that. Seek out and speak to a trusted, credible and experienced Canadian business financing advisor who can assist you with your needs for financing sources 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 10 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 :

7 Park Avenue Financial = Canadian Financing Sources




CONTACT:
7 Park Avenue Financial
South Sheridan Executive Centre
2910 South Sheridan Way
Suite 301
Oakville, Ontario
L6J 7J8
Phone = 905 829 2653
Fax = 905 829 2653
Email = sprokop@7parkavenuefinancial.com














Stan Prokop

Asset Financing Dead As A Doornail ? Let An Equipment Lease Company Revive Your Business Finance Challenges

Is Equipment Lease Financing The Magician You’re Looking For Re: Asset Finance Needs?


OVERVIEW – Information on the equipment lease company solution in Canada . Why this method of asset financing continues to gain traction for Canadian corporations





Asset Financing. Could the Canadian Equipment Lease company be the ' magician ' that turns your asset financing challenges around? We think it does, in more ways than one - and we'll prove it. Let's eliminate that ' dead as a doornail ' feeling around business financing . Let's dig in.

Every Canadian company in Canada is a candidate for lease finance solutions. From the start up to the country's largest corporations - all of them have utilized lease financing. North American stats show that over 80% of companies employ this asset finance strategy.

The lease marketplace in Canada is extremely robust. Whether you firm can command rock bottom rates for large ticket transactions, or alternatively if you have financial challenges a lease transaction can always be structured.

Is it the perfect solution all the time? We're a bit biased , but we recognize that for some companies issues such a pride of ownership, the desire to maximize the residual value of the asset, or wanting 100% control of every aspect of the asset over its useful equipment life are prime .

But, if you concerned about issues such as:

Technology obsolescence
Limited use of assets for a specific period of time
Capital preservation
Credit / Financing approval
Budget limitations and cash flow and working capital issues
Flexibility during the term of use of the asset


Let’s just say that - Welcome to the world of equipment finance

So how does the magic come about when you're looking for the optimal asset financing solution? First of all, pretty well every lease company in Canada wants your business (some might not be perfectly suited for your firm - but they probably still want your business!) - The industry is flourishing and robust in Canada.

Rates in lease finance are always commensurate with credit quality - and even Canadian chartered banks for the most part aggressively participate in this method of business asset financing. Bank lease rates are among the most aggressive in the country. If you company has a clean balance sheet, profits, and good predictable cash flows you are in the enviable position of commanding low rates and amortizations that can go anywhere for 2-10 years in most cases . (Typical lease terms tend to be 3-5 years).
But didn’t we say that everyone is pretty well a candidate. So if your firm has credit and financial challenges lease transactions can still be structured to meet your needs.

How does your firm engage in the ' magic ' when it comes to process? You can approach a lessor directly, solicit bids via tender (government and large corporations often do this, or you can solicit the services of an experienced and credit business financing advisor with lease finance expertise.

Issues such as credit finance approval, type of lease you choose, ensuring competitive rates and structures can easily mystify or distract the business owner/manager -. That's the time to get some solid expertise. Issues such as documentation, tax issues, balance sheet implications, etc seem boring but have a large impact on the ultimate success of your asset financing strategy.

So, can the Canadian equipment lease company put the magic into your asset financing success? Thousands of companies day in and day out can't be wrong. Seek out and speak to a trusted, credible and experienced Canadian business financing advisor who can assist.


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 10 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 :

7 Park Avenue Financial = Canadian Equipment Financing Expertise






7 Park Avenue Financial
South Sheridan Executive Centre
2910 South Sheridan Way
Suite 301
Oakville, Ontario
L6J 7J8
Phone = 905 829 2653
Fax = 905 829 2653
Email = sprokop@7parkavenuefinancial.com















Stan Prokop