Business Alternative Lending Solutions : Don’t Get Left Behind On Finance Alternatives

The Middle Path In Canadian Business Financing

OVERVIEW – Information on business alternative lending in Canada . Finance alternatives available to Canadian business owners are more attainable than you think



Finance alternatives in Canada often require the Canadian business owner/financial manager taking the ' middle ground. Traditional finance solutions are, unfortunately, not available to everyone - that means business alternative lending of some type must often be considered, hence the 'middle ground'... so let's dig in.

It really comes down to how you look at the issue - one expert suggests that it's not a ' one size fits all' scenario when it comes to bringing in either debt or operating capital to your business.. That's of course how a business is financed - bringing new debt to the balance sheet or financing assets you already have, in effect monetizing them for working capital.

So it's obvious that a better way to look at it is to ensure you have considered all the options under various scenarios, it is not a question of simply thinking you are some what forced into a particular finance solution.

A good example might be considering a Government SBL loan for the addition of assets or leaseholds to your business, or even to start a business from scratch, including a franchise operation of some sort. While a Canadian chartered bank on its own might refuse to consider such financings in your circumstances you might be pleasantly surprised that they will finance your project under the auspices of the SBL loan.

Many clients we talk to are often happy to consider business alternative lending if only to save time and management focus given that traditional bank type solutions might take many weeks or months to finalize. Trust us, ' it’s a process'!

You should of course consider all financing options, which might well include a bank financing of some sort.- just be forewarned that the financial history of your business, your length of time in business, and your cash flows and profits will come under scrutiny. All of those must align.

While business alternative lending sources might have a lower threshold level of criteria they typically therefore have higher rates - not all the time but 99% of the time. We feel that the best way to look at that situation is to ensure you are viewing alternative finance as a short term solution, typically a year or so. That allows your business to get all the capital it needs but not lock your business into a situation you cannot get out of.

And what are those alternate finance sources? You’d be surprise at the number of choices - They include:

Invoice Financing

Confidential Receivable Financing Facilities

Inventory finance

Non bank asset based lines of credit

Securitization

PO / Supply chain finance

Sale leasebacks

Bridge loans


If you want to be able to assess the ‘ middle ground ‘ in Canadian business financing seek out and speak to a trusted, credible and experienced Canadian business financing advisor who can assist you in ensuring you’re not left behind in finance solutions for your company .



Stan Prokop - 7 Park Avenue Financial :

http://www.7parkavenuefinancial.com

Business financing for Canadian Firms , specializing in working capital, cash flow, asset based financing , Equipment Leasing , franchise finance and Cdn. Tax Credit Finance . Founded 2004 - Completed in excess of 90 Million $ of financing for Canadian corporations . Info /Contact :


7 Park Avenue Financial = Canadian Alternative Finance Expertise !







Have A Question /Comment On Our Blog Or Canadian Business Financing Alternatives ?

CONTACT:

7 Park Avenue Financial

South Sheridan Executive Centre
2910 South Sheridan Way
Suite 301
Oakville, Ontario
L6J 7J8


Direct Line = 416 319 5769

Office = 905 829 2653



Email = sprokop@7parkavenuefinancial.com


' Canadian Business Financing with the intelligent use of experience '

Stan Prokop

Financing Cash Flow : A Fresh Look At Managing Working Capital

Behind The Scenes In Cash Flow Finance Solutions

OVERVIEW – Information on solutions for financing cash flow in Canadian business . Managing working capital is all about assets and solutions



Managing working capital and financing cash flow needs , like other aspects of business , often needs a ' fresh look ' when it comes to addressing the operating and growth needs. Let's dig in.

While a surplus in cash might always be the goal the bottom line for the majority of businesses in the SME (small to medium enterprise) sector the actual reality is that it’s a working capital shortage that is more often than not the challenge.

How the business owner / financial manager deals with that can often be the deciding factor as to whether you're winning or losing n Canadian business.
What business person doesnt relish the thought of putting capital to work to grow more sales and profits, right?

The worst case , of course , in both not managing your working capital, or being unable to access alternative or traditional financing is of course total business failure .

While we're the first to espouse ' alternative ' business financing solutions we're also the first to point out that even alternative financing solutions can be extended if your firm is perceived to be in a death spiral.

What then are some of the positive uses of managing working capital and have access to more cash? They include:

Expanding your business into new product or service areas

Being able to take out more funds for shareholders with the expense of a hit to your financials

Improving relations with suppliers and key vendors

Reducing debt and lowering financing costs


How then do owners/ financial managers address cash flow issues? While the most common is a Canadian chartered bank overdraft facility there are numerous other ways to access cash flow and finance assets. They include:


A/R financing

Asset based lines of credit (they monetize receivables, inventory and fixed assets all into one facility

Inventory finance

Tax credit monetization

Securitization

Sale leaseback

Working capital term loans


While bank financing is the ' go to ' solutions for almost everyone, ' go to' is often impossible if your firm can't meet bank criteria for lending.

Remember that with the exception of working capital term loans all the solutions we have referenced simply monetize assets and allow you to cash flow assets, with no new additional debt coming onto the balance sheet.

A/R financing is often the most comment and logical solution to working capital finance. That's because next to actual cash on hand that you have in the bank it’s the closest asset to cash that you have!

Our recommended solution to clients in this area is the CONFIDENTIAL RECEIVABLE FINANCING solutions. It allows you to bill and collect your own accounts and receive advances of 90% of all sales you generate into your business ledgers. And by the way, its your call as owner or manager to access how much you need and when ; similar to a bank facility you of courser only pay for what you are using , so it makes more sense than ever to manage your receivables efficiently .

If you're looking for that ' new way ' to address the problem of accessing cash to run your business seek out and speak to a trusted, credible and experienced Canadian business financing advisor who can take you behind the scenes in real world finance solutions.





Stan Prokop - 7 Park Avenue Financial :

http://www.7parkavenuefinancial.com

Business financing for Canadian Firms , specializing in working capital, cash flow, asset based financing , Equipment Leasing , franchise finance and Cdn. Tax Credit Finance . Founded 2004 - Completed in excess of 90 Million $ of financing for Canadian corporations . Info /Contact :

7 Park Avenue Financial = Canadian Cash Flow Financing Expertise !





Have A Question /Comment On Our Blog Or Canadian Business Financing Alternatives ?

CONTACT:

7 Park Avenue Financial
South Sheridan Executive Centre
2910 South Sheridan Way
Suite 301
Oakville, Ontario
L6J 7J8

Direct Line = 416 319 5769

Office = 905 829 2653



Email = sprokop@7parkavenuefinancial.com


' Canadian Business Financing with the intelligent use of experience '

Stan Prokop

Options For Commercial Business Financing In Canada Provide A Competitive Edge

Do Business Finance Options Allow You To Wreak Havoc With Competition ?

OVERVIEW – Information on commercial finance choices in Canada . Options for business financing are essential for growth and profits



Options for business financing , executed properly often give the Canadian business owner and financial manager the ability to ' wreak havoc' with the competition, a feeling all businesses probably want to relish. Knowing the commercial financing choices you have available to wreak that havoc is key. Let's dig in.

Just knowing some solid info on how your competition operates can often lead you to financing choices as they relate to the size of your firm, how fast you can grow, the maximum profits you can achieve, and understanding the overall credit profile of clients in your sector .

In some cases also your ability to achieve growth from a merger or acquisition is totally dependent on financing solutions that can make that happen.

In recent times we've learned the hard way that its not just about getting a ' deal ‘, more often than not in the SME sector its simply knowing that somewhere out there is either a traditional, or ' alternative ' finance option for your business.

Lenders, investors, even competitors who know a bit about your firm will often spend significant time on how certain relationships of items on your balance sheet and income statement will show your strength or weakness . Firms with a large amount of debt quickly run into two tricky situations:

1. They are vulnerable to a downward spiral of sales and profits

2. They find that access to traditional bank type financing all but disappears

It goes without saying that if you have your financial house in order your financial strength and access to financing provide a solid bridge to sales revenue growth, cash flow, and profits.

Top experts tell us that a recommended way to address options of financing revolves around two key areas:

1. The amount of funds you need and how you will use them

2. Knowing ( and buying into ) what stage of life your business is in - as that ' stage ' dramatically affects type , cost and structure of financing you need.

As we have offered in the past you are in 1 of 4 different ' stages' of business existence - Simply speaking: startup, early growth, middle market SME, and large cap mature

While the following options are all available to Canadian business:

Going public
Mezzanine financing
Govt SBL loans
Tax Credit Monetization (SR&ED, etc)
Bank lines of credit
Bridge loan
Sale Leasebacks
Non Bank asset based lines of credit
Equipment financing
A/R financing
Inventory finance
PO/Supply chain finance

It’s important to note that some are either unavailable, or even inappropriate for the size, nature and stage of your business.

The right business finance options will always allow you to strategically position your company ahead of the competition; in effect wreak your own style of ' havoc' with the competition.

Seek out and speak to a trusted, credible and experienced Canadian business Financing Advisor with a track record of success who can assist you in positive havoc creation as it relates to finance choices!



Stan Prokop - 7 Park Avenue Financial :

http://www.7parkavenuefinancial.com

Business financing for Canadian Firms , specializing in working capital, cash flow, asset based financing , Equipment Leasing , franchise finance and Cdn. Tax Credit Finance . Founded 2004 - Completed in excess of 90 Million $ of financing for Canadian corporations . Info /Contact :


7 Park Avenue Financial = Canadian Business Finance Options Expertise







Have A Question /Comment On Our Blog Or Canadian Business Financing Alternatives ?

CONTACT:

7 Park Avenue Financial

South Sheridan Executive Centre
2910 South Sheridan Way
Suite 301
Oakville, Ontario
L6J 7J8

Direct Line = 416 319 5769

Office = 905 829 2653


Email = sprokop@7parkavenuefinancial.com

' Canadian Business Financing with the intelligent use of experience '

Stan Prokop

Sr Ed R and D Financing And Film Finance Credit Bridge Loans Are Cash Flow Power : Here’s How

Drawing A Blank On Tax Credit Financing In Canada?

R&D And SR&ED Bridge Loans And Media Tax Credits



OVERVIEW – Information on sr&ed and film finance credit finance solutions. SR ED bridge loan r and d financing and media tax credits provide solid cash flow solutions



SR ED R&D financing , as well as the film finance credit often has some clients we meet ' drawing a blank' when it comes to how to monetize either one of these two significant programs.

The reality is that either tax credit provides significant cash flow power, and the ability to finance you credits either before, or after they are filed represents your ability to beat the 'waiting game’ as it pertains to the government approving, and processing your refund chq. Let's dig in.

The SR&ED program, for those who follow or have a vested interest in it has been turned upside down and inside out in the last year or two. It got to the point where the govt did what they do well (?), which is commissioning a report on the validity and benefits of the program to the govt and claimants.

Given that the government provides funds for these two programs in the Billions of dollars it's no surprise the R&D credit program came under significant scrutiny. Since the thousands of claimants under the program are in the SME (small / medium enterprise) sector they have become significantly dependent on the program the changes out of the government study (‘The Jenkins Report') were fairly dramatic, both positive and negative. They included:

Significant emphasis on the real government ' pay back' on the program

Simplification of the application process

Elimination of certain of the credits under the program - i.e. capital expenditures (The main deductions center around payroll and contractor expenses)

Strong focus on who exactly is preparing the claims (aka ' Sred Consultants') and how compensation is charged

The program is primarily for private firms and doesnt discriminate when it comes to industry, geographical location,


FILM TAX CREDIT FINANCING:

While some might say the SR&ED program doesnt maximize Canadian investment in research the converse is probably true when it comes to the film finance credit. (Film finance credits include movies, TV, animation and digital effects) The ' Hollywood North' nickname for Canada didn’t come by chance; hundreds of productions have been filmed or produced here because of the tax credit investment climate.

The three largest cities, Vancouver, Toronto and Montreal all have booming media business.

The financing challenges on any project in any media category are significant. The right film tax credit, when maximized with the assistance of a good tax credit accountant delivers anywhere from 30-50% of total financing required.

The 3D industry is a booming example of the Canadian film industry. Spending by Cdn and co production partners is in well over a billion dollars in VFX areas.

FINANCING YOUR SR&ED or FILM TAX CREDIT:

Tax credit financing is most often structured as a bridge loan. To the benefit of the borrower no payments are required during the duration of the loan and the loan is collapsed as soon as your refund chq comes in. While some banks participate in this type of financing many producers and foreign co production partners seek commercial financing expertise outside the banks.
If you are looking for true financing of a SR ED or Media tax credit seek out and speak to a trusted, credible and experienced Canadian business Financing Advisor with a track record of success who can assist you with your cash flow needs in this area.



Stan Prokop - 7 Park Avenue Financial :

http://www.7parkavenuefinancial.com

Business financing for Canadian Firms , specializing in working capital, cash flow, asset based financing , Equipment Leasing , franchise finance and Cdn. Tax Credit Finance . Founded 2004 - Completed in excess of 90 Million $ of financing for Canadian corporations . Info /Contact :


7 Park Avenue Financial = Canadian SR&ED And Film Tax Credit Financing Expertise!






Have A Question /Comment On Our Blog Or Canadian Business Financing Alternatives ?

CONTACT:

7 Park Avenue Financial

South Sheridan Executive Centre
2910 South Sheridan Way
Suite 301
Oakville, Ontario
L6J 7J8
Direct Line = 416 319 5769
Office = 905 829 2653

Fax = 905 829 2653

Email = sprokop@7parkavenuefinancial.com


' Canadian Business Financing with the intelligent use of experience '

Stan Prokop

Cash Flow Finance Solutions : Positive Thinking On Canadian Asset Financing

Transforming Sales Revenue Into Cash Flow

OVERVIEW – Information on cash flow finance solutions in Canada. Mastering the right asset financing at the right time helps guarantee business success



Cash flow finance solutions are all about transforming your sales revenue into cash flow for your company. Sometimes it's easy, more often than not... it isn't. Various forms of asset financing are available to achieve that goal - they come with different costs, structures, and implications. Let's dig in.

One of the things that business owners don't often recognize is the need to take a hard look at the ' difference' between working capital and cash flow in their business. What? There's a difference? There sure is we tell our clients - because the text book situation occurs when your sales are growing, things are great, your accountant tells you that you're making a profit... the only issue .. you feel you're constantly in a cash flow crisis.

The best way to look at it is to simply view the situation around cash flow as the funds that are generated at specific times. It relates directly to what we call the ' cash flow conversion cycle ' which simply tracks the time it takes for money to flow through your business... and end up in the bank.

The profits you show on your income statement almost never approximate the amount of cash you have in the bank. How does the business address financing the working capital accounts: receivables, inventory, and work in process? Numerous solutions are available. A few bring new debt on the balance sheet, which often isn't desirable (example - a working capital term loan).

The other solutions which typically 'monetize' your working capital accounts simply cash flow your assets - into capital... today. Those solutions? They typically include:

Canadian chartered bank lines of credit

Non bank asset based lines of credit

Inventory Finance

Receivable finance

Tax Credit Monetization (Financing your SR&ED claim)

Working Capital term loan

Unsecured Cash Flow Loan

Purchase Order Financing

Sale leaseback of owned assets

Certain types of cash flow finance solutions require traditional credit criteria - for instance banks insist and require clean strong balance sheets, profits, and solid historical cash flow. Thousands of business owners and financial managers can't meet these criteria, so other solutions are still relatively easily attainable - they often come at a higher cost but still provide all the capital you need.

An example - The non bank asset based line of credit. It provides a revolving credit facility that monetizes your A/R, inventory and equipment into one business line of credit. While often 2-3 times more expensive thank current low bank rates it’s still a solid method of achieving cash flow finance.

We mentioned already that profits and assets don't equal cash. If there is any good news in this statement its that if you do have positive working capital - i.e. assets to cover your short and long term liabilities you are solvent. But how you manage, and finance those assets will ultimately determine the success of your business.

If you are looking for ways to transform assets in to cash and manage growth seek out and speak to a trusted, credible and experienced Canadian business financing advisor who can assist you with your cash flow needs.


Stan Prokop - 7 Park Avenue Financial :

http://www.7parkavenuefinancial.com

Business financing for Canadian Firms , specializing in working capital, cash flow, asset based financing , Equipment Leasing , franchise finance and Cdn. Tax Credit Finance . Founded 2004 - Completed in excess of 90 Million $ of financing for Canadian corporations . Info /Contact :


7 Park Avenue Financial = Canadian Cash Flow Financing Expertise





Have A Question /Comment On Our Blog Or Canadian Business Financing Alternatives ?

CONTACT:

7 Park Avenue Financial
South Sheridan Executive Centre
2910 South Sheridan Way
Suite 301
Oakville, Ontario
L6J 7J8

Direct Line = 416 319 5769

Office = 905 829 2653



Email = sprokop@7parkavenuefinancial.com


' Canadian Business Financing with the intelligent use of experience '

Stan Prokop

Confidential Receivable Financing : The Re- Invention Of Invoice Factoring Services

The Experts Guide To The Best A/R Financing

OVERVIEW – Information on receivable financing in Canada. One of the best factoring services is Confidential receivables finance – here’s why




Receivable financing in Canada has made some interesting gains in recent times. First of all there is nothing like winning a 'popularity contest ' and thousands of firms have continued to embrace this method of financing cash flow. And even better than that some interesting ' changes' to how this finance works has offered even more appeal to the Canadian business owner/ financial manager. Let's dig in.

The SME (small to medium enterprise) sector in Canada can be forgiven for feeling under served when it comes to accessing capital that other larger and public companies find easier to achieve. So a sub set of asset based lending, ' factoring services' have stepped in nicely when they find themselves less ' credit worthy' and unable to access all of the working capital they need.

If we step back a bit it's not hard to discover why receivable financing services have such appeal. Utilizing this method of financing, including our favourite and recommended " CONFIDENTIAL RECEIVABLE FINANCING ' your company can finance all North American A/R , ( international accounts often require some form of credit insurance ) , and depending on the type of financing you need risk of bad debt can even be transferred to your financing partner.

While the traditional form of this financing can be termed somewhat ' invasive ' as the collection dept of your firm is taken over by the finance firm it still works for thousands of firms who simply wish to access capital , and aren't really concerned about notifying clients about how they finance their business .

Enter Confidential A/R finance. The appeal here is significant. While the main benefit continues to be the fact that you have daily access ( if you need it ) to working capital this type of ' confidential ' credit line facility allows you to bill, and collect, all your receivables without any intervention whatsoever with a third party . In our own experience with clients that seems to be the desired route business owners/ financial managers wish to take, perhaps it’s our inherent Canadian conservatism!

So how does this method of financing cash flow work? It's pretty basic stuff. Standard finance documents that you would sign with any type of financing are put in place at the outset of the arrangement.

All sales you generate can be financed the same day that invoices are generated. 90% margining of accounts is typically available, which by the way even beats the 75% offered by our Canadian chartered banks. Your clients are totally unaware of your financing mechanism, and you're running a ' business as usual ' company, with one exception; you have all the cash flow and financing you needed based on your sales growth!

If your firm has good financial records and a track record of growth, as well as future growth potential seek out and speak to a trusted, credible and experienced Canadian business Financing Advisor with a track record of success who can assist you with the best factoring services.





Stan Prokop - 7 Park Avenue Financial :

http://www.7parkavenuefinancial.com

Business financing for Canadian Firms , specializing in working capital, cash flow, asset based financing , Equipment Leasing , franchise finance and Cdn. Tax Credit Finance . Founded 2004 - Completed in excess of 90 Million $ of financing for Canadian corporations . Info /Contact :


7 Park Avenue Financial = Canadian Receivable Financing expertise!







Stan Prokop









Have A Question /Comment On Our Blog Or Canadian Business Financing Alternatives ?

CONTACT:

7 Park Avenue Financial

South Sheridan Executive Centre
2910 South Sheridan Way
Suite 301
Oakville, Ontario
L6J 7J8


Direct Line = 416 319 5769

Office = 905 829 2653


Email = sprokop@7parkavenuefinancial.com


' Canadian Business Financing with the intelligent use of experience '

Stan Prokop

A Sale Leaseback Is A Solid Way Accessing Bridging Finance Needs : The Asset Bridge Loan Made Easy

A Different Way Of Looking At Short Term Loans Via Bridge Finance



OVERVIEW – Information on the bridge loan concept in Canada . Sale leaseback transactions can help the balance sheet and cash flow via a unique way of looking at bridging finance need




Bridging finance , in some manner, is often sought by Canadian business owners and financial managers. The sale leaseback, via a traditional lease, or a ' bridge loan' (there’s a difference) is one way to achieve that financing need. Let's dig in.

Your company has the ability to make maximum use of your firms owned assets in a manner you may not have considered. It's the 'sale lease back’, and by selling back the asset, or assets to a third party you can address several key challenges you might be facing on the balance sheet, not the lease of which is cash flow.

So how is this type of transaction completed... successfully ? Several factors come into play. When you have assets such as equipment, technology, and even real estate that are used in your core business, are still needed, and are owned outright a significant opportunity exists to ' cash flow' the asset/assets.

Naturally the need for capital can be satisfied in a number of ways, but most owners are reluctant to address the issue of new equity investment - it dilutes ownership and sometimes simply isn’t possible.

Let's recap some of those key benefits of a bridge loan/ leaseback on owned assets. They inlcude:

The ability to free up equity that’s held on your balance sheet - this could actually be distributed to the owners or used as a working capital component to continue growth of the company

If your business is doing well and simply hampered by growth capital the ability of your company to earn higher profits that offset the costs of the bridging finance is a desirable route

In many cases it allows the company to re do their balance sheet in some manner, i.e. pay down other more expensive debt, eliminate some debt altogether, etc

Using company owned real estate as an example you can ensure your company is using capital to operate and grow the business, as your charter is clearly no real estate ownership. Note: Many large corporations, even our chartered banks included have sold their real estate holdings and leased them back - even the big guys recognize they are running a business, not investing in real estate. Apologies of course to those ' PRIDE OF OWNERSHIP' folks!

In certain cases the interest rate environment alone might be a major consideration. The current low rate environment might make sense to acquire capital at 4% and reduce debt acquired at 9% as an example.

Finally, in some cases your advisors such as accountants and the tax folks might be able to point out some solid advantages to a sale leaseback.

If you’re looking for a different way to raise capital/cash the sale leaseback is a great way to address bridge finance needs. That might be either a traditional lease or a short term bridge loan. Seek out and speak to a trusted, credible and experienced Canadian business Financing Advisor with a track record of success who can turn those needs into ' easy'.



Stan Prokop - 7 Park Avenue Financial :

http://www.7parkavenuefinancial.com
Business financing for Canadian Firms , specializing in working capital, cash flow, asset based financing , Equipment Leasing , franchise finance and Cdn. Tax Credit Finance . Founded 2004 - Completed in excess of 90 Million $ of financing for Canadian corporations . Info /Contact :

7 Park Avenue Financial = Canadian Sale LeaseBack expertise!







Stan Prokop









Have A Question /Comment On Our Blog Or Canadian Business Financing Alternatives ?
CONTACT:

7 Park Avenue Financial
South Sheridan Executive Centre
2910 South Sheridan Way
Suite 301
Oakville, Ontario
L6J 7J8

Direct Line = 416 319 5769

Office = 905 829 2653



Email = sprokop@7parkavenuefinancial.com


' Canadian Business Financing with the intelligent use of experience '

Stan Prokop