Turnaround Finance Canada: Don’t Just Imagine Company Restructuring Financing

Ch – Ch - Changes – Turnaround & Restructuring Financing In Canada

OVERVIEW – Information on turnaround finance solutions in Canada . Investigating key aspects and elements of successful company restructuring financing needs

Turnaround finance solutions in Canada will almost always mandate ' ch ch changes '

in how a business is and will be financed. While David Bowie probably wasn't thinking company restructuring financing when he wrote his iconic song it's safe to say that ' change ' is something business owners in challenging situations must address. Let's dig in.

Financing solutions for ' turnarounds ' have the ability to be both complex and simple, requiring knowledge, experience and the ability to access financial resources that augment the turnaround. The goal is almost always the same - avoid bankruptcy, maximize the value of the assets of the business, and in some manner ensuring the long term viability of your company. Bottom line, it’s all about addressing the various constituents - owners, creditors, suppliers, employees.

While we're focusing here on financing issues other items need to be addressed- i.e. sales growth, employee issues, cost reduction, etc. All of those, and others, necessitate ' ch ch changes'! In many cases the type of industry you are in will often necessitate the type of change required.

Assets and collateral are often at the heart of any turnaround finance. If not addressed with the right financing solutions the perception or reality is that assets have the potential to lose their value in challenging times. The ability to leverage those into a proper finance solution is key. Unfortunately items such as ' goodwill ' and ‘R&D' don’t play well into current and immediate fix requirements. In some cases they might need to be written down or curtailed respectively.

One of the best solutions that is somewhat all inclusive and a one stop fix is the ' ABL ' - the Asset Based Loan. Whether term or operating in nature it rounds up receivables and inventory (operating) and equipment and real estate (term) assets and monetizes them into one facility. Almost always it takes our current secured creditors and banks - while often injecting more capital into the business immediately. It allows owners and financial managers to address what the pros call the ' capital structure ' of your business in a temporary fix manner.


While fewer ' traditional ' finance options exist in turnarounds those that do can address your creditor issues.

Other company restructuring solutions include:

Bridge loans

Sale Leasebacks

Mezzanine / Cash Flow financing

Any one of the solutions we have mentioned allow the business to self correct some of those key issues around financial ratios, covenants, owners guarantee liability, etc.

What is the focus of a financial turnaround? Key requirements include:

- A strong and realistic cash flow forecast - (strong A/R and a/p analysis)
- understanding current liquidity
- balance sheet /working capital ratio analysis
- profit /margin analysis

The best situations in turnaround often show that the company itself has a lot of long term potential, it’s just all about correcting the present balance sheet - in effect a ' makeover' is required!

Timing is everything in refinancing under restructuring - it's all about stopping the negative cascade of events and perceptions. One top expert referred to his as halting the ' melting ice cube '!
Accessing turnaround finance requires credibility and expertise. 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 restructuring financing that helps ensure the fix.




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 TURNAROUND 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

Leasing Companies In Canada : Calling All Businesses Needing Lease Company Asset Financing Needs

Looking For A Hail Mary Pass On Financing Assets ? Here It Is

OVERVIEW – Information on leasing companies in Canada . What does the business owner/manager need to know in order to benefit from a lease company solution



Leasing companies in Canada almost always provide the classic ' Hail Mary Pass ' when it comes to financing asset needs. Whether its fixed assets, rolling stock, or technology needs the ' right ' lease company solves the problem, just when you needed it most. Let's dig in.


How though does the business owner/financial manager sift through, process, and reap the benefits of the equipment financing solution? Numerous real or perceived obstacles come up - they include a requirement to understand some of the basics of the industry, allowing you to reap the benefits they so strongly preach.

While many owners more experienced in lease financing constantly reap those benefits many firms still wrestle with the basics - they include:

What is the difference in rates based on asset size, credit quality, and type of asset financed?

Are there alternatives to the lease solution?

How important are the tax and accounting implications of asset financing?

Is it necessary to perform a ' lease vs. buy ' analysis?

What types of leases are available and how do they work?


As a lessee you're in much strong position than you think. The Canadian lease landscape is very competitive, current rates are at an all time low, and different types of finance firms truly want your business. By the way it's during this negotiation stage that your firm, or your lease advisor. truly wields the most negotiating power.

At future stages in the lease process when it comes down to credit approval and documentation it's as important to define your rights and obligations under the lease .Knowing the asset quality and useful life of the asset is also important, as that ' end of term ' value is often critical to knowing who's making more money on the transaction, you or your lessor!

As we have said, the choice in your financing needs is significant in the Canadian marketplace. Independent commercial firms, banks and captive finance firms that are directly related to manufactures all vie for your business. A lot of shoe leather can be wasted, by the way , when it comes down to searching for firms that ultimately can't meet your needs when it comes to deal size, assets financed, or your firms credit profile . The good point of ' credit profiles is that virtually all credit quality can be financed. If your company has credit ' challenges ' leases can be ' structured' vis a vis term, down payment, outside collateral, etc.

It can't be expected that all firms requiring asset financing needs know all there is to know about the mechanics of the equipment lease. That's when it might be beneficial to use the services of a trusted, credible and experienced Canadian business Financing Advisor with a track record of success who can assist you in issues such as:

Pricing/ financing cost

Your firms deal requirements

Suitable funders

Documentation/ Credit Approval

In effect you're utilizing the experience and knowledge of the industry for your firm’s maximum benefit. All of a sudden that ' Hail Mary pass' looks better than ever.


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 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

A Shred Credit Financing Loan Unleashes The Cash Flow Power Of Your R and D Sred Tax Credits

SR&ED Tax Credits :

Prepared - Check

Filed - Check


Financed - Check!

OVERVIEW – Information on ‘ SHRED’ ( SR&ED ) credit financing in Canada . The ability to utilize SRED Tax credits loans enhances your businesses ability to accelerate the cash flow benefits of this program – ie monetizing your refundable tax credit today , without the wait

Shred Credit financing in Canada eliminates business owners / financial managers trying to imagine when they will receive their refund. The cash flow derived from a SRED Tax credits loan is often one of the most valuable cash flow injections many firms experience through the year. Let dig in.


For the thousands of firms that file for the billions of dollars in refundable tax credits the program is somewhat affectionately known as ' SHRED ' , while the actual correct name has the ' ampersand' in it - namely SR&ED . When your company utilizes and qualifies for this R&D recovery strategy you're in a position to recover a large majority of the expenses your firm outlays for research and development.

We're the first to acknowledge the program name, SR&ED, Sred, or whatever..!! conjures up images of men and women in white coats and labs.

The reality? Thousands of Canadian firms use the program and qualify for work they do in advancing their products, services, and processes. A very general rule of thumb is that 35% or so of funds spent are typically recovered.

But how do owners overcome what some associate as time consuming in anything related to government? That's easy - as the vast majority of claims are prepared by third party ' SR&ED Consultants ' , who further eliminate time and both risk by preparing claims on a contingency basis - thereby claiming a portion of the refund for their work . They are responsible, along with yourself for deadlines, quality of your claim, and the back up needed to validate your firms spend.

With respect to the financing of the claim suffice to say that rarely do owners complain about anything that refunds a large portion of your firm’s expenses in your effort to stay competitive. What can cause concern of course is the time gap in between filing and waiting for your refund! Business owners would always prefer to get those funds working in their business , for any purpose they desire, including of course starting to spend on next years work in research.

Enter the SRED TAX CREDITS Loan! It leverages your claim into instant cash flow/working capital;

even more so given the general ' SHRED' credit financing structure. Financings are structured as ' bridge loans ' which enable you to monetize up to 70% of your claim today, without making payments during the time of the loan.

When the combination of federal and provincial claims are approved and funded by the govt the loan is in effect ' collapsed ' with your firm receiving the balance of the claim less financing costs which typically are ' mezzanine' in nature given the uniqueness of the financing .

Looking for even better news? Consider the fact that claims can be financed prior to filing, or even as you start next years claim.

If you're looking to unleash the financing power of Shred Credits consider a SRED Tax credits loan : 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 the financing of your refund .






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 :


http://www.7parkavenuefinancial.com/shred-credit-financing-sred-tax-credit-loan.html





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

The Rise Of Online Financing In Canada

Check our our article which was featured as a cover story in the latest issue of CANADIAN EQUIPMENT FINANCE MAGAZINE ( article is on page 20 )


Here's the link to this excellent publication geared towards borrowers and lenders alike :


http://issuu.com/dmn.ca/docs/cef_novdec2014_w/1




If you're looking for finance solutions in any area of lease financing including
technology acquisition, software finance, sale leaseback contact us .



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 '

Receivables Loans Provide AR Cash Flow Advantages

The Design Genius & Advantages Of Non – Bank Confidential A/R Receivables Based Financing

OVERVIEW – Information on AR cash flow solutions in Canada . Receivable Loans ( it’s not a loan per se!) via Confidential A/R Financing just might be the solution to beat your working capital finance challenges

AR cash flow can be achieved in a number of manners. Receivable loans (they are not actually loans by the way!) for many business owners and financial managers immediately conjures up bank financing. But that's not always the case as we'll see. And you just might find the 'design genius ' of some of these offerings quite interesting, and more importantly... achievable. Let's dig in.

The concept of financing A/R revolves around the need for short term day to day operations. That challenge is accentuated when it comes to ' growing ' your revenues and profits. Businesses requiring SME COMMERCIAL FINANCE needs should not feel alone in this area - some of the largest companies in Canada constantly have to address cash flow needs.

So what then is ' Confidential ' A/R based finance? At it's simplest it's securing financing via your client receivable base on a typically ongoing basis. When you're dealing with a bank your accounts are ' pledged’, but a commercial finance firm utilizes paperwork to reflect an ongoing 'sale ' of your accounts as they turnover. That's the essential difference.

It's not secret that bank rates for any business financing is typically the lowest cost of borrowing. While Confidential ' non notification' loans are more expensive, their benefits mirror a traditional bank facility. This is achieved via your ability to bill and collect your own invoices, while still reaping the cash flow benefits of same day financing for all your sales.

Many firms that utilize commercial A/R cash flow loans are in a transitory phase. They are either leaving the bank (having been asked to!) or seeking commercial financing for their sales as they repair any financial issues in their business allowing them to migrate back to... you guessed it... the bank!

There is no business that does not have the ability to finance their accounts receivable. The only requirement - Sales and commercial A/R.

While we have painted a picture of many businesses having no access to bank funding there are numerous firms who have access to some bank credit, but not all that meets their needs.

From an approval perspective Confidential A/R funding takes a holistic look at your whole business - that encompasses your current financial position, its challenges, your industry, as well as your overall client portfolio. Issues that can slow down, but not hinder your AR financing might be CRA issues or having some clients or a client represent a large part of your whole business - i.e. the concept of ' concentration'.

What then are some key ' drivers' that you would consider in receivable loans? They include:

Positive : the ability to achieve continual financing day to day, facilities revolve, growth becomes virtually unlimited , greater flexibility in negotiating terms with key / new /large clients

Less than Positive

- higher cost, occasional higher reporting needs


If you're interested in the 'design genius ' of AR cash flow financing that mirrors a bank solution 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 your finance 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 A/R 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

Bank Financing Solutions In Canada : A Mindset Rework On Working Capital & Term Loan Solutions

Diving Into Bank Financing In Canada With Knowledge Vs. Myth

OVERVIEW – Information on achieving successful bank financing in Canada. Working capital, cash flow and term loans can power your business to new levels with flexible finance and low costs if you know how to qualify and position your business

Bank financing in Canada is often viewed as a ' hurdle ' for business owners/financial managers, particularly in the SME COMMERCIAL FINANCE needs area. These can be often overcome with some basic knowledge of success strategies to achieve what is arguably the lowest cost/most flexible financing available to the Canadian business owner. We're diving into some truths and myths around bank lending .Let's dig in.

We're not 100% sure of the per cent age amount of bank finance applications that are declined in the Canadian marketplace , but we do know that in talking to clients it's difficult for them to overcome getting inside the box . The box? That's the credit box of ratios, covenants and collateral that your firm must fit in. When you are not approved you're forced to get financing ' outside the box '! - more on that later.

Let's cover off some basic bank solutions to your capital needs, and then let's discuss several key areas you can in effect ' pre-qualify' yourself on, thereby improving chances of success.

The good news in Canadian chartered bank financing is that, when successful, you can achieve all your short, intermediate and long term financing needs for your business.

Those needs? They include:

Unsecured business loans: These loans are substantiated by your immediate cash flow. Terms are shorter in nature and are often for interim financing or seasonality finance needs of your business

Business line of credit: This of course is to cover off your ongoing working capital needs. It's quick daily access to your ongoing working capital and cash flow needs. In essence it funds your working capital accounts on your balance sheet - typically A/R and inventory.

Term loans/ Leasing - These solutions allow you to finance fixed assets and take on debt that makes sense for your firm. While not all Canadian banks offer ' leasing' solutions for assets in some cases they partner with major well known players. A term loan can also often achieve the same results and equipment lease finance.

Let's cover off some basics around the process. First of all it's critical to have a strong handle on what can be called your ' use of funds'. Knowing how much to ask for allows you to take a look at your finance statements and ensure you can meet 'debt service' ratios that are required for approval. Key point - banks love ratios!

Get used to it!











Typically a cash flow ratio of 1.25:1 is required. By knowing your cash flow ratio you can literally determine yourself the amount of busines credit you will qualify for - all other things being equal.

In the SME COMMERCIAL space in Canada owners must have reasonable personal credit. Know your credit score and be prepared to address issues that might arise out of that discussion.

Canadian chartered banks focus a lot of collateral, both inside the business as well as the owners outside net worth/assets. Different types of assets have different value - a good analogy would be real estate versus perishable inventory. Big difference in collateral!

Bank financing can also be achieved via the Govt Guaranteed Business Loan, which is administered by the banks but is actually a govt program, it’s a great way to achieve inside the box financing that you might otherwise not qualify for.

If it's necessary to go ' outside the box '

don’t forget that numerous non bank solutions exist for business capital needs. They include:

A/R Financing
Inventory Finance
Asset based non bank lines of credit
Tax Credit Financing for refundable tax credits
PO/Royalty financing
Leasing/Sale leasebacks

If you're looking to do a rework on your mindset of what Canadian chartered bank business financing is , or is not seek out and speak to a trusted, credible and experienced Canadian business financing advisor who can assist you with your capital needs - inside and outside the box!



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 BANK 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

Asset Lending In Canada: A Multiverse Possibility On The Newest Business Revolving Line Of Credit

While You Were Out A New Kind Of Business Credit Line Emerged

OVERVIEW – Information on asset lending as the newest form of a business revolving line of credit . Here’s why this works .. and how

Is a business revolving line of credit the only one of its kind in Canada, or the universe for that matter? The answer is a resounding ' no '! - Apparently it’s really a ' multiverse '! where asset lending has created a unique version of business borrowing for revolving credit facilities. Let's dig in.

Asset lending is somewhat of a ' stealth ' type of borrowing in Canada - unbeknownst to many it has become extremely popular. So in our parallel universe we have the Canadian chartered bank line of credit as well as the 'ABL' (Asset Based Lending ‘) facility. While our banks choose to focus on a combination of cash flow, balance sheet proportions, and evidence of good profits the ABL credit line chooses to keep it simple - it's all about your assets - namely a/r , inventory, and fixed assets; any single or combination thereof .

The asset based line of credit also distinguishes itself in that it can also be used as the base financing for purchasing a business, merging with one, or reviving one via a turnaround. Larger retailers, who typically only carry inventory as their financeable asset, are excellent candidates for asset lending as one can imagine.

In the U.S. for example some of the largest and most successful well known corporations have turned to asset based lending as their ' credit line of choice ‘. It should be mentioned that for larger successful companies there is almost no negligible difference in rates/financing costs when benchmarked against bank lending.


However, in the SME COMMERCIAL FINANCE area in Canada these facilities, while providing more liquidity come at a higher cost. So for the business owner/financial manager its all about balancing liquidity needs and access to capital versus cost of financing.
Similar to bank facilities the ABL credit line is typically renewed on a yearly basis; although some companies prefer (or are asked) enter into multi year commitments for the financing.


How do commercial asset based lenders justify this type of borrowing when it comes to their own returns and risk? The answer is quite simple - as one top expert put it, they are ' fanatical' about asset quality and turnover, as well as putting in more disciplined reporting. This offsets the need for covenants, ratios, and outside collateral, which is the staple of commercial bank lending in Canada.

Typical asset lending provides a borrowing margin of 90% on receivables and a much higher level of borrowing power on inventories and fixed assets. So, in case you haven’t figured it out your business has access to different solutions in your business revolving line of credit needs. Whether it's traditional bank financing or credit line achieved via asset lending seek out and speak to a trusted, credible and experienced Canadian business financing advisor who can help you navigate the financing universe, or should we say ' multiverse'.





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 CREDIT LINE 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