Equipment Loans And Leases : How Much Do You Know About Leasing Companies

Why Canadian Business Got Hooked On Leasing Business Equipment

OVERVIEW – Information on why leasing companies are almost always a solid bet when it comes to asset financing/refinancing . Recognizing the benefits of equipment loans and leases makes your business a winner




Equipment loans and leases in Canada, as offered by leasing companies and other commercial finance firms are at an all time high in popularity.

When the business owner/ financial manger understands why this is the case he or she can take advantage of benefits and advantages that are reserved for all. Its one time when following the crowd is a must! Let's dig in.


The acquisition of assets in business always comes down to several key decision points - the use and benefits of the asset and the cost and cash flow outflow ramifications. More and more the owner / manager is focusing on using an asset, not necessarily owning it. With all respect to those ' pride of ownership ' folks preserving cash flow is almost always king.

Equipment financing sometimes by necessity can get a little complex - more often than not it’s a simple process, but it’s critical to understand that some of the factors you must also consider in financing equipment include:

Tax ramifications

Accounting Treatment

Effects on your balance sheet / Debt load

Impact on credit line facilities

It's interesting to note that almost all the Canadian chartered banks today offer specialized leasing services via separate entities within the bank. Typically these transactions are reserved for bank clients, and those that have solid credit. Deal size is typically larger here also.

The balance of industry is covered off by independent Canadian commercial finance companies. These firms typically have set credit profiles they are looking for, as well as deal size and asset mix.

In Canada almost any asset can be financed. That includes technological needs also - such as computers, software, telecom equipment, etc

While the majority of the industry is focused on what is known as the ' Capital lease ‘, aka ' lease to own ' its important to know that another choice exists - that’s the ' Operating lease ' or ' lease to use ' so to speak.

Factors that business owners must take into account when considering leasing or the type of lease they will choose include -

Estimated life of the asset

The desire to own or return the asset

Leasing structure relative to rate, term,

Cash flow impact


Computer leases are probably the best way to describe the benefits of operating leases. That’s because the technology changes so quickly. Owners wish to often upgrade, replace or refresh, and assets can be efficiently returned with no obligation to buy.

Assets you own can also be leased by the way! That’s essentially called a sale leaseback, and allows you to keep assets in the business and take advantage of the equity in those assets. The process is relatively simple and includes ensuring the asset is lien free, has value (typically via an appraisal) and ensuring a proper lease or loan structure is in place. The lease can be in this case substituted for a ' bridge loan' of sorts.

Have we forgotten anything? Oh yes. If you business offers a product that can be leased you can benefit from offering a customer financing program. By partnering with the right firm you can offer all the benefits of equipment loans and leases to your clients. Key benefits include:

Immediate cash flow for the vendor

Removal of budget and price constraints in your products

Creating a strategic advantage via your client’s perception you offer a one stop solution


So, if 80% of Canadian business is ' HOOKED ' on solutions offered by leasing companies the choice seems pretty clear. 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 business financing 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 EQUIPMENT FINANCING AN LEASING 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

Filed Research And Development Credit On Hiatus ? Accelerate SR ED claims Via A SRED Financing

Looking To Side Step Waiting For Your SR&ED Claims ? Finance Them ! Here’s How


OVERVIEW – Information on SRED financing in Canada . Monetizing your SR&ED Research and Development Credit makes cash flow sense











SRED Financing in Canada is all about cash flowing/monetizing your SR&ED tax credit. It's not unusual for business owners and financial managers that access this program to get the feeling their claim is on somewhat of a ' hiatus ' after they have filed their claim. Can things be ' speeded up ' a bit? They can! Let's dig in.

While there might be some legitimate reasons for the actual time period from filing your claim to receiving your refund cheque from the government that’s little consolation to your business - a significant amount of time has lapsed since you've spent those funds, and you're looking for ' cash back' !

What are some of the reasons a claim is delayed or slowed down based on time to final approval and refund? They might include things such as the financial or technical audits done on your business and the claim. It might also simply be a ' backlog ' has occurred in volume of claims processing inside Canada Revenue Agency.

It should be no secret by now that there have been some major changes in the program. This includes a lot of scrutiny on those folks that prepare claims (aka ' SR&ED Consultants ‘) who created a feeding frenzy of sorts around the way they bill their fees on the processing of your claim. These fees typically were ' contingency fees ' meaning that the consultant bore the risk around the time and ultimate success of the claim, and for that charged a per cent age of final amount received.

SRED Financing allows for your research and development credit claim to be cash flowed, allowing you to purpose the funds for any general company purpose. This is even more critical to firms that are in development or pre revenue stages.

A handful of common sense strategies and enhance both the final approval of your claim, as well as it's financing. They include:

1. Ensuring you are taking advantage of your positive SR&ED history - while claims for first time filers can be financed it goes without saying a track record in previous years sure helps the cause and speed of your approval

2. Ensuring your claim addresses some of the key ' true requirements ' of a claim such as your firm’s efforts to address uncertainty, advancement in processes, etc

3. A copy of your SR ED claim is always a key part of the financing of the claim - remember that the claim itself is the key ' collateral ' for a SRED loan

The other parts or a SR&ED loan application are as basic as they can be - your financials , a list of any secured creditors , info on who prepared your claim, etc .

SR&ED loans are structured in a unique manner. They typically are set up as a loan with no payments made during the term. Funds are advanced at 70% loan to value - for instance a filed 200k claim would be eligible for a collateral loan of $140,000.00. Naturally when the claim is approved by CRA and funded you receive the balance of 30%, less financing costs.

Banks in Canada don't really finance a SR&ED loan. So if you want to ' side step ' the waiting line for cash flowing your R&D claim seek out and speak to a trusted, credible and experienced Canadian business financing advisor who can assist you in monetizing your research and development credit .



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 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



Email = sprokop@7parkavenuefinancial.com


' Canadian Business Financing with the intelligent use of experience '

Stan Prokop

Tech Financing Needs : What You Ought To Know About Technology Corporate Finance

Get Rid Of Technology Financing Challenges Once And For All

OVERVIEW – Information on technology corporate finance solutions in Canada. Consider these tech financing strategies to maximize ROI

Tech financing needs in Canada can be a combination of challenge (and a headache!) Canadian businesses in the SME and large corporate sector. Technology corporate finance solutions, no matter how small or large your company is, come in a variety of flavors and sizes. Let's dig in.

The start up or early phase company has difficulty in attracting any type of financing. So planning for tech solutions and upgrades is crucial and challenging. The reality, as harsh as it is in Canada is that owner equity provides the majority of early stage financing for operations and technology. The irony here is that many times the technology is what will drive higher and faster growth and profits.

Service based businesses, and those relying on ' IP ' (intellectual properly)

create even more of a problem for themselves, as much of the financing for the SME Commercial sector in Canada is ' asset based '. So from the owner/financial manager perspective they feel they are compelled to take financing at rates, structures and terms that are less than favorable.

It's no secret to Canadian business owners and entrepreneurs that it's difficult to pitch technology financing needs to our Canadian chartered banks. The reasons are pretty simple: Tech needs seem to quickly become obsolete, and even with prices of the majority of tech assets going down in price they still are a huge part of any firms ' CAPEX' budget.

So who are the ' sources of financing ' - those firms that can fill the tech financing gap you're faced with? As well, is there a better way to address rapid growth in technology changes and those ' life cycles'?

One way to secure financing for hardware, software, telecom equipment, etc is to take a look at the Government CSBF loan. Recent changes have appeared to make the program even more popular. Billions are borrowed every year under this program.

So is there a clear cut way to finance the acquisition of technologies? The obvious choice? LEASING! The reasons are pretty simple - along with typical tax and accounting advantages the owner/manager has the ability to match cash outflows with the ' estimated ' useful life of the asset.

And because many firms want to ' use ', not ' own' tech assets they also have the choice of opting for operating leases. These allow for maximum flexibility when it comes to upgrades, buying out, or simply extending.

Currently the industry as a whole prides itself of fast approvals, often within a day or so. And again, those assets that can be financed:

APPLICATION SOFTWARE
COMPUTERS
SERVERS
LAPTOPS/NOTEBOOKS/TABLETS
TELECOM EQUIPMENT
PHONE SYSTEMS

If you're looking to get the proverbial ' monkey off your back ' when it comes to financing tech needs 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 ensuring you're ' up to speed' in tech corporate finance requirements.



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 TECHNOLOGY 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

Business Cash Flow Loans : Reversing the Working Capital Slowdown

Your Business Cash Flow Financing Nightmare Is Probably Not Just In Your Head

OVERVIEW – Information on business cash flow loans and asset monetization strategies for Canadian businesses. Working capital needs can be fulfilled in a variety of manners – here’s why and how
















Working capital shortages can almost always be reversed with the right asset monetization or business cash flow loans. It's no secret that challenge can easily become a nightmare

when not identified and properly addressed in a timely manner. Let's dig in.

Critical to implementing the right solution is the understanding of some key basics - they include:

Understanding your ' cash flow cycle’

Halting and managing cash outflows

Being able to accelerate cash receipts via proper credit and collection policies

Your company can improve overall business health with proper cash flow management and external and internal financing. We've mentioned above that ' cash flow cycle '. It's simply the ability to understand how a dollar flows through your company and how long it spends in inventory, A/R, etc.

But what solutions are in fact available to halt the oncoming of a cash flow crisis.

They typically include:

Bank lines of credit

Asset based non bank lines of credit (Known as ' ABL ' they are the alternative to Canadian chartered bank facilities

A/R financing (this comes in a variety of shapes and sizes)

Inventory finance

Working capital term loans (permanent injections of working capital)

Purchase order/Contract financing

Tax Credit Financing (SR&ED Tax credits)

These are the external financing solutions available to any firm that wants or needs to address avoiding a cash flow crisis. Internally though owners and financial managers can better monitor and accelerate cash via constantly assessing days sales outstanding, inventory turns, and payables days outstanding. Oh and don't forget expense mgmt!

A simple cash flow forecast can easily anticipate upcoming working capital and cash shortages. A simple trick - Constantly monitor the relationship between A/R and sales on a monthly basis, in the form of a ' ratio'. If that ratio is greater than one? Danger ahead! Simply speaking cash flow problems are upcoming as you are running out of cash.

Your company is either eligible for bank financing or it is not. Bank finance solutions in Canada are low cost, and flexible. In some cases your company might be eligible, but not in the amounts needed.

Short term shortages must be addressed by short term financing strategies, typically lines of credit, A/R financing, and inventory finance. Many businesses of a small to medium size are considering A/R finance these days. This tool turns everyday sales into everyday cash. Our recommendation is to consider CONFIDENTIAL RECEIVABLE FINANCING. While more expensive than bank lines it provides unlimited financing and allows you to bill and collect your A/R in a matter similar to bank credit facilities.

If you want to avoid the cash flow nightmare via proper business cash flow loans and asset monetization strategies seek out and speak to a trusted, credible and experienced Canadian business financing advisor who can assist you with your working capital 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 CAS FLOW BUSINESS LOANS 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

Franchise Loans Canada : Let The Sun Rise On Franchising Finance Success

Are You ‘ All In ‘ When It Comes To Franchising Finance in Canada You Don’t Have To Be !

OVERVIEW – Information on franchise loans in Canada . Franchising finance properly executed doesn’t have to be the financial personal commitment that some franchisees think it needs to be . Here is why


Franchising finance makes many would be ' entrepreneurs ' feel like they must be ' ALL IN ' when it comes to franchise loans in Canada. ‘ALL IN ' of course connotation major personal investments in their franchises. Does it have to be that way? Not necessarily! So let's dig in.

When it comes to financing a franchise in the current ' hot ' Canadian franchise market the clients we talk to seem to think that comes with significant personal investments, overdrafts on personal lines of credit, and complicated financing packages that inter mingle with their personal finances. Again, that’s what they think, but it’s not necessarily the case.

We must emphatically say that the would be franchisee would be entrepreneur must in fact contribute some capital to the business. It goes without saying there no ' free ride ' on ' OPM ' - i.e. 100% other people’s money.

In fact some of the amounts required to properly finance this type of business in fact are normally not financeable - those include the actual franchise fees themselves, brokerage or consultant fees, etc. These types of charges typically come out of the owner’s capital investment.

As a broad rule you should be prepared, depending on the overall situation, to put down anywhere from 10-50% of the total amount of financing required to kick start your venture.

Funding the balance of franchise loans in Canada is typically dependant on the size of the purchase, the quality of cash flow forecasts, and lenders interpretation of the viability of your franchisor as a whole. Not all franchisees might be aware that many franchisors are willing to let a franchise fail, knowing they can re-sell it to another potential viable franchisee. Here issues such as ' location/ location/location' and mgmt competence and experience are important.

Never forget that at the end of the day the actual repayment of the franchising loan, which typically is amortized over 5-7 years will in fact come from ongoing cash flows and profits. Since most franchisees tend to be 100% cash businesses that is important.

In Canada franchises are financed via a small handful of specialty finance lenders, the Govt SBL loan, and a combo of various other financing solutions that might inlcude equipment financing, merchant advances, working capital term loans, etc.

So our advice? You don't have to be ' all in ' thinking you have to pledge your personal assets in franchising finance. More important is the ability to seek out and speak to a trusted, credible and experienced Canadian business financing advisor who can assist you with your funding 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 FRANCHISING 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

Lease Back Financing Tips : Sale And Leaseback Transactions Can Be A Winning Strategy

Sale Leaseback Financing Makes Seemingly Impossible .. Possible!

OVERVIEW – Information on the ‘ leaseback ‘. Sale and leaseback transactions, done properly, can be a solid cash flow tool . Here’s some key considerations







Sale and leaseback transactions are sometimes a truly perfect solution cash flow needs. In some ways it’s a ' perfect storm' of financing - your business gets to keep the asset in question (typically equipment or real estate) while at the same time employing its use and possession.

By the way, that could include your corporate jet - although we don't run into
a lot of those these days.


What are the fundamental reasons for choosing the lease back? It usually comes down to:

A need for access to capital that otherwise might not be available, or available the rate and structure the business owner/manager desires

It’s sometimes a more efficient and quicker process than starting the journey into looking for new debt solutions or having to consider ownership dilution from new equity sources. Alternately the owner/owners of the business are now required to put in additional personal funds

The ongoing need and use of the asset to operate and grow the business - otherwise the asset should probably simply be sold!

In certain cases, as we mentioned, rates and costs of financing might be more attractive under the sale/leaseback

Because of the nature of how the transaction is recorded the lease back, properly structured can enhance the overall ROI - ' return on investment’

As we noted any asset of the business can theoretically be sold and leased back. A typical solution is business real estate, i.e. the business operating premises. Even Canadian banks in recent years have shed their huge office towers under this effective strategy. - And they of course still inhabit the buildings.

The other asset category is business equipment, which, while depreciating still has valuable use to the business. That raises the point that it’s important to consider the financial and tax consequences of the leaseback - for example if the funds received are greater than the present value of the equipment a profit on the transaction might have to be reported.

When you enter into this financing strategy your choices are the same as with any other lease financing transaction. Simply speaking you can structure your deal as a capital ' lease to own' or an operating ' lease to use '. The operating lease might be perfect for things such as a technology transaction for computers and telecom equipt. for example.

And that corporate jet

we were talking about? All of a sudden is a perfect candidate for an operating lease!

We caution clients that it's always important at the start of considering such a transaction it’s important to fully understand the value of the equipment or asset being re financed. That residual value must be well understood in the context of your company's needs for the asset and the financing structure required.

Seek out a trusted, credible and experienced Canadian business Financing Advisor with a track record of success who can assist you in putting together a winning strategy on refinancing business assets. The impossible just became possible.




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 AND LEASEBACK 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

Business Asset Finance Via Confidential Factoring Services Finally Explained

Looking for a Cash Flow Rescue Solution - Confidential A/R Finance Via Non Notification might just be it


OVERVIEW – Information on the benefits of confidential factoring services . Business asset finance via an invoice discounting program is a happy medium between bank A/R financing and alternative finance solutions




Business asset finance comes in a variety of 'flavors '. One of those is Confidential Factoring Services, which is the monetizing of your sales and receivables into immediate cash flow. Let's dig in.

While any form of Canadian business financing is meant to allow the owner/.manager to grow the business the harsh reality sometimes is that it also ' rescue ' the company when financial challenges and pressures have made traditional forms of financing unavailable . Think ' the bank'.

And by adding the word ' confidential '

into this method of financing it’s as close to traditional financing as one can get.

In the business cycle of any commercial business, whether that is a product or service sales generate receivables which generate cash. Whether your firm is start up, early revenue, or fast growth its all about your ability to ' release' working capital out of sales revenue.

Canadian chartered banks do that for you by setting up business lines of credit. The receivables (and sometimes inventory) act as the 'collateral' for the facility. Confidential factoring services provide the same result; they just do it in a different manner.

That difference is the essence of receivable finance/factoring in general, as the paperwork around the facility ' monetizes' your A/R. The paperwork in effect has you ' selling' your sales for cash as they are generated, and the use of confidential factoring allows this to be done privately between you and the finance firm.

That level of confidentiality is important , because we benchmark that against ' old school'

factoring ( still hugely popular ) which makes the whole process fairly public between your clients, yourself etc. In our experience business owners and financial managers in the SME (small to medium enterprise) sector like to keep how they finance their business to themselves.

Let's make sure we all understand the process of CONFIDENTIAL RECEIVABLE FINANCING. As you generate sales you receive 90% of your sales invoices as immediate cash to your business bank account. In our case immediate pretty well means ' same day ‘. Bye bye receivables - hello cash on hand!

So what are the benefits then?

Hopefully they are pretty obvious. They include your ability to run and grow your business. As long as you are generating revenue you will always have the respective amount of cash available.

For the majority of many of our clients we see them now being able to take on larger contracts and sales orders. No more worrying that your are reaching your ' borrowing limit ‘, as with pre set bank credit lines.

Some clients also use this cash to pay down other debt they have taken on, although it’s important to ensure you are matching short term financing solutions with short term debt obligations.

Let's summarize the process again quickly -

1. Sell your products and services!
2. Provide your invoices to your finance partner
3. Receive immediate cash (10% is held back and paid to you as soon as your client pays - it’s a ' buffer ')

Note - the financing costs of Confidential factoring are taken out of that 10% holdback and as an example would be in the 150 -200$ range on a 10,000$ invoice.

If you're looking for a rescue plan on cash flow challenges seek out and speak to a trusted, credible and experienced Canadian business financing advisor who can ensure that this unique method of financing is carefully explained re costs, benefits, and operations.



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 CONFIDENTIAL RECEIVABLE 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