How Can My Canadian Company Get a SR & ED Tax Credit Loan - Can SR ED's Be Financed?

Looking to be on the winners list for Canada's SR&ED Program ? Here's one way

Information on SR&ED financing in Canada . SR&ED loans are an important way for Canadian business owners
to access the cash they require to facilitate their r&d goals.

Not all Canadian business owners and financial managers are aware of one of the greatest government programs still currently in existence at both the federal and provincial level. The formal name for the program is Scientific Research and Experimental Development program. Most people call it simply the SRED (SR &ED) program; we have also heard many people pronounce it as 'SHRED 'also!




Not all Canadian business owners and financial managers are aware of one of the greatest government programs still currently in existence at both the federal and provincial level. The formal name for the program is Scientific Research and Experimental Development program. Most people call it simply the SRED (SR &ED) program; we have also heard many people pronounce it as 'SHRED 'also!

We put Canadian businesses into two categories when we discuss the program - those that don't know about the program period, and those that know about the program but are not aware that their claims can be financed.

SR ED financing is an excellent source of short term cash flow, and allows a company to reap the benefits, in cash of funds that they have put into R&D.

It is probably useful to do a short overview - let's call it a SR ED primer!

The program is administered at the federal and provincial levels of the Canadian government. It is very important to note that the SR ED grant (yes it's non-repayable) is for Canadian private firms only - it does not apply to public corporations the program is applicable literally to almost every type of firm and industry in Canada. A company files it's claim at the same time it files it's year end tax return.

In our experience the majority, we feel almost 95%+ of claims are prepared by an independent third party. They have expertise, credibility, and have a strong knowledge of the program and the government requirements. We would further point out that if a claim is not prepared by a qualified third party then there may be an issue in financing the claim - not always, but sometimes.

Claims can be expensive to process and prepare, and in general the industry has evolved into two types of costs associated with the claim. What are those two cost scenarios?

1. Customer pays a third party in full for time and preparation involved in the claim. The customer reaps the full benefits of the claim when it is processed

2. Customer signs an agreement on a contingency basis, and pays the preparer of the SR ED a portion of the claim when it is approved - bottom line he has no cash outlay and the SR ED consultant is at risk re time and preparation involved in the claim.

Let's now focus on financing of the claim. The financing of the claim is somewhat of a boutique industry in Canada, and requires specialized knowledge around the quality and collateralization of the claim. The Canadian banks, as a rule, with only minor exceptions, do not make SR ED loans.

Claims are financed at approximated 70% of loan to value. What do we mean by that? We mean that loans on SR ED are made to 70% of their combined federal and provincial amount. Example - Customer files a claim for $ 300.000.00. The SR ED loan would be for 70% of that amount: = $210,000.00.

Claims can be financed relatively quickly when working with a qualified financing expert in this area. It certainly is possible to complete a transaction in a couple of weeks, from initial discussions.

Naturally some level of due diligence is required on the firm, and we point out that many firms are in fact total start ups and are filing their claim for the first time. An additional financing note is that first time claims are scrutinized more closely as the customer at that point does not have a track record in this area. Track records help the financing.

In a future article we will discuss further relevant aspects of SR ED financing. Our key take away points here are that the SR ED program is a very viable program and sourced of cash for Canadian business. Claims can be financed, and are a valuable source of working capital for many Canadian firms. If your firm sees the benefits of SR&ED financing 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 financing needs.








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 100 Million $ of financing for Canadian corporations . Info /Contact :





ABOUT THE AUTHOR
Stan has had a successful career with some of the world’s largest and most successful corporations.
Prior to founding 7 Park Avenue Financial in 2004 his employers over the last 25 years were, ASHLAND OIL, ( 1977-1980) DIGITAL EQUIPMENT CORPORATION, ( 1980-1990) ) CABLE & WIRELESS PLC,( 1991 -1993) ) AND HEWLETT PACKARD ( 1994-2004 ) He is an expert in Canadian Business Financing.

Stan has over 40 years of business and finance executive experience. He has been recognized as a credit/financial executive for three of the largest technology companies in the world; Hewlett-Packard, Digital Equipment and Cable & Wireless. Stan has had in depth, hands on experience in assessing and evaluating thousands of companies that are seeking financing and expansion. He has been instrumental in helping many companies progress through every phase of financing, mergers & acquisitions, sales and marketing and human resources. Stan has worked with startups and public corporations and has many times established the financial wherewithal of organizations before approving millions of dollars of financing facilities and instruments on behalf of his employers.





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

Factoring Costs In Canada : The Receivables Factor Credit Line Solution

Finally ! The Mumbo Jumbo Around Factoring & Receivable Financing Costs Resolved

OVERVIEW – Information on factoring costs in Canada associated with a receivables factor credit line

Receivables financing, via a ' factor credit line ' often conjures up two words in the mind of business owner/entrepreneurs and financial managers - Mumbo Jumbo!

Factoring costs and how these facilities work, including the different types of A/R facilities available have often created mass confusion for Canadian businesses searching for a simple solution for cash flow and working capital problems. The solution? Understand what this financing does, how it costs, and identify which of numerous types works for your goals. Let's dig in.

So what is ' factoring financing ‘? At first glance it seems too simple. Selling your receivables as you generate sales for immediate cash. While originally gearing for specific industries factoring no long discriminates - it's available for all commercial receivables in all industry sectors.

Confusion reigns supreme when it comes to the ' cost ‘associated with this method of finance. We think we know the reason - simply that the way commercial factor company prices receivables finance is associated by their clients as an ' interest rate '.

It's not.

Financing your factor credit line on a daily basis works as follows: A specific amt of the invoice - typically 1.5-2% is deducted when funds are advanced. Clients we talk to take those #'s - multiply by 12... and Panic!

The basic answer here is that the ' price' a commercial lender charges in factoring is simply a cost for using money for typical 30 day term, and annualizing that like a fixed term loan with an interest rate is a poor comparison. It's not a loan, and by the way those factoring costs become even lower when you use the cash within that period to take your own supplier discounts, negotiate better vendor prices, and lower the cost of carrying your receivables, which have a true cost associated with them that most owners don’t always consider.

When do you decide to finance your A/R through a non bank 'factor' solution? The factors (no pun intended!) we consider when we talk to clients are:



Your Rate of return you earn on running and profiting in your business

What amount of cash you prefer/need to have on hand

The amount of negative cash balance, i.e. overdraft that will seriously impact your business

The discount fee or ' price ' that factoring firms will charge you



Is there one factor credit line solution that stands out head and shoulders above the rest? Here’s your best choice and why. It's called CONFIDENTIAL RECEIVABLE FINANCING and it's ' confidential ' in that your clients or vendors have no notification of how you are doing your financing. It's your competitive edge while receiving all the benefits of this method of cash flow financing.

So what about some more of that Mumbo Jumbo?! When you're not working with a trusted advisor in business financing you just might find you're a little ' befuddled' around the different types of facilities the industry offers - they include”

A/R DISCOUNTING
FULL NOTIFICATION FACTORING
REVERSE FACTORING
NON – RECOURSE FACTORING
SPOT FACTORING


.... All of which do the same thing - finance your A/R with different nuances around day to day financing of your sales. Heaven forbid we disparage anyone in the industry , but keep in mind that many firms only offer 1 type of this method of financing – leaving you unclear on your other options at a time when you need cash the most .

Looking to clear up some of that Mumbo Jumbo? Seek out and speak to a trusted , credible and experienced Canadian business financing advisor who can assist you with your Receivable finance needs.


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 100 Million $ of financing for Canadian corporations . Info /Contact :

7 PARK AVENUE FINANCIAL = CANADIAN RECEIVABLE FINANCING AND FACTORING EXPERTISE



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 '

ABOUT THE AUTHOR
Stan has had a successful career with some of the world’s largest and most successful corporations.
Prior to founding 7 Park Avenue Financial in 2004 his employers over the last 25 years were, ASHLAND OIL, ( 1977-1980) DIGITAL EQUIPMENT CORPORATION, ( 1980-1990) ) CABLE & WIRELESS PLC,( 1991 -1993) ) AND HEWLETT PACKARD ( 1994-2004 ) He is an expert in Canadian Business Financing.

Stan has over 40 years of business and finance executive experience. He has been recognized as a credit/financial executive for three of the largest technology companies in the world; Hewlett-Packard, Digital Equipment and Cable & Wireless. Stan has had in depth, hands on experience in assessing and evaluating thousands of companies that are seeking financing and expansion. He has been instrumental in helping many companies progress through every phase of financing, mergers & acquisitions, sales and marketing and human resources. Stan has worked with startups and public corporations and has many times established the financial wherewithal of organizations before approving millions of dollars of financing facilities and instruments on behalf of his employers.








Stan Prokop

Asset Based Lending PutsYour Balance Sheet Back To Work Via A Commercial Credit Line

Have You Considered Mining As An Option To Business Finance Success?

OVERVIEW – Information on asset based lending in Canada . ‘ ABL’ financing is a more recent version of commercial credit line requirements for firms that can’t access the chartered bank financing they need

Asset based lending in Canada, we maintain, in the context of a commercial credit line puts you in the mining business! What are you mining? Answer: your balance sheet! Let's dig in

Ever felt like you're getting 'squeezed '. Thousands of businesses in Canada in the SME sector feel that way as most top experts see them search for Canadian business financing alternatives. Asset based credit lines (called ‘ABL’s) use your total business assets (or parts of them as applicable) to address financing needs.

Many reasons draw businesses to ABL commercial credit facilities. It might be the general cyclicality that comes with many industries, or in certain cases it might be best for firms that are having financial challenges and can't be 'banked' properly by our venerable Canadian chartered banks.

What are the key differences then in a senior loan facility from asset based lending versus ' traditional' financing as offered by Cdn banks? Simply speaking it’s the essence of ' collateral ' - your ability to borrow heavily against inventory and receivables, as well as your fixed assets if you want those in the mix also. The result: More operating funds! , even when cash flow is still not yet positive.

While your balance sheet takes on no debt in an ASSET BASED LENDING commercial credit line in certain cases it might makes sense to structure the fixed asset portion of the ABL facility as a term loan. Bottom line – to quote our lawyer friends ‘it depends’ !

While some of the largest and most successful corporations in the world utilize asset financing today for their business credit lines we're old enough (unfortunately!) to remember when there was actually some element of a negative stigma to firms that used non bank operating credit facilities! One proof of that? Boutique divisions of banks actually also offer this financing, competing with their ‘regular banking ' peers for these type of facilities. (The one caveat of a bank ABL is that minimum facility size is in 5-10 Million $ range - often an unrealistic requirement for firms in the SME COMMERCIAL FINANCE sector.

While an alternative for many firms in certain circumstances is a term loan or an unsecured cash flow loan many business miss the only key requirement for that type of financing - Positive cash flow. Enter ABL operating financing to the rescue. It's very safe to say that more often than not new equity capital is either totally unrealistic to consider, or impossible to access.

Fluctuating sales often drive business owners to look for business credit alternatives such as asset based lending. In certain cases some of these operating funds might be used to pay down or help organize other existing debt.

One other major difference in the eternal ' bank vs. abl ' struggle is the noticeable lack of ratio and covenant requirements in asset based lending. We've always thought that using financial ratios to run and manage your business is a better use rather than borrowing on them!

While there is no doubt that the majority of ABL loans probably lean towards Canadian businesses that have finance challenges - some of that driven by the ebb and flow of success and challenge in many industries . Example - automotive seems great now... in the past? Not! using the General Motors bankruptcy as an example. While a combo of fast and high growth is desirable by many entrepreneurs’ banks don't necessarily like the unpredictability of the financial complications and challenges that come with that. ABL likes high growth / fast growth.

If you're ready to consider ' mining ' your balance sheet for additional operating line business credit seek out and speak to a trusted, credible and experienced Canadian business Financing Advisor with a track record of success who can help your balance sheet back to full employment !



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 100 Million $ of financing for Canadian corporations . Info /Contact :

7 PARK AVENUE FINANCIAL = CANADIAN ASSET BASED LENDING AND COMMERCIAL CREDIT LINE EXPERTISE





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 '

ABOUT THE AUTHOR
Stan has had a successful career with some of the world’s largest and most successful corporations.
Prior to founding 7 Park Avenue Financial in 2004 his employers over the last 25 years were, ASHLAND OIL, ( 1977-1980) DIGITAL EQUIPMENT CORPORATION, ( 1980-1990) ) CABLE & WIRELESS PLC,( 1991 -1993) ) AND HEWLETT PACKARD ( 1994-2004 ) He is an expert in Canadian Business Financing.

Stan has over 40 years of business and finance executive experience. He has been recognized as a credit/financial executive for three of the largest technology companies in the world; Hewlett-Packard, Digital Equipment and Cable & Wireless. Stan has had in depth, hands on experience in assessing and evaluating thousands of companies that are seeking financing and expansion. He has been instrumental in helping many companies progress through every phase of financing, mergers & acquisitions, sales and marketing and human resources. Stan has worked with startups and public corporations and has many times established the financial wherewithal of organizations before approving millions of dollars of financing facilities and instruments on behalf of his employers.




Stan Prokop

Shred Credit Financing Loan : Log Into SR ED Cash Flow Success

We’ve Hacked Into Some SR&ED Program Secrets – Including Financing Your Claim

OVERVIEW – Information of SHRED credit financing in Canada . Using a bridge loan for your refundable tax credit in the SR&ED program allows your company to accelerate cash flow via your investment in r&d

A ' Shred Credit ' is one sure fire way of completing the SR&ED cycle when it comes to that ' goal line' feeling of accessing your well deserved r&d refund. So let's ' hack' our way into some solid program tips and secrets around sr ed cash flow success, including our best tip : finance your claim! Let's dig in.

There's no doubt that your portion of the 2-3 Billion refunded annually in CRA's ' SR&ED ' (Scientific Research and Experimental Development) program is well deserved, and a legitimate and valuable business expense recovery. It's safe to say your competitors are also lining up for their fair share.

Investing in the ability to improve your products and or processes clearly is a win / win for any firm, improving chances of sales and profits. No where in business life is the expression ' timing is critical 'more important than the SHRED Credit process which has a lot of important timelines that can't be missed. While some of those deadlines might not necessarily impact your ability to finance your claim it's a sure thing scenario that they might well slow down your ability to get your refundable tax credit approved.

Key timelines include of course filing your claim within the governments prescribed limit for you to actually file coincident wit your fiscal year end. At this point you also will be co coordinating the actual filing with your accountant and your SR&ED consultant -those folks that typically prepare the majority of claims.

While the majority of SRED claims do in fact involve those consultants it's typically because the risk and cost borne with preparing claims is covered by SR ED consultants. These folks have certainly taken the heat on their fees, but times have settled down it seems.
Most top experts agree that a solid SR&ED claim depends more on technical expertise than financial or accounting smarts.

Given that all business loans have interest/financing costs attached to them one can see the important of both maximizing your refund via its quality, as well as filing as quickly as you can. Financing costs associated with a SR&ED loan can then be minimized. SHRED Credit loans rarely last a year and are often shorter, and... by the way... can be repaid at any time in whole or part.

Any size business from start up to larger firms can finance their claims- including by the way start ups, partnerships, and even individuals.

The financing of a refundable R&D tax credit is a basic process. Key collateral? The SHRED! The quality of the claim is a natural consideration for financing - therefore the importance of either your previous filing experience with the program or the general reputation of your SR ED preparer.

Typical other documentation in a SR ED Cash flow loan is general business info, your financials, and info/overview on owner’s mgmt. If other secured creditors have claims on your business it's critical to ensure that the paperwork around the SR ED can properly have the refund as collateral.


‘How much can we get? ‘is our clients typical question around a bridge loan for their tax credit. The answer? The vast majority of claims are financed at a 70% loan for sred value ratio. That of course is for the combined full value of your fed/prov refund. Loans typically take a couple weeks to fund.

If you’re looking to ‘ log in’ to the benefits of a ‘ shred ‘ credit 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 with your SR ED cash flow needs.








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 100 Million $ of financing for Canadian corporations . Info /Contact :

7 PARK AVENUE FINANCIAL = CANADIAN SHRED CREDIT LOAN EXPERTISE



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 '


ABOUT THE AUTHOR
Stan has had a successful career with some of the world’s largest and most successful corporations.
Prior to founding 7 Park Avenue Financial in 2004 his employers over the last 25 years were, ASHLAND OIL, ( 1977-1980) DIGITAL EQUIPMENT CORPORATION, ( 1980-1990) ) CABLE & WIRELESS PLC,( 1991 -1993) ) AND HEWLETT PACKARD ( 1994-2004 ) He is an expert in Canadian Business Financing.

Stan has over 40 years of business and finance executive experience. He has been recognized as a credit/financial executive for three of the largest technology companies in the world; Hewlett-Packard, Digital Equipment and Cable & Wireless. Stan has had in depth, hands on experience in assessing and evaluating thousands of companies that are seeking financing and expansion. He has been instrumental in helping many companies progress through every phase of financing, mergers & acquisitions, sales and marketing and human resources. Stan has worked with startups and public corporations and has many times established the financial wherewithal of organizations before approving millions of dollars of financing facilities and instruments on behalf of his employers.






Stan Prokop

Business Loans And A Line Of Credit : Checking Out Asset Lending Is Worth It

The Unboxing Of A New Type Of Business Credit Line

OVERVIEW – Information on ‘ ABL ‘ – The asset based lending solution for a corporate line of credit . Not all business loans and revolving facilities are created equal and offer the same benefits . Here’s an alternative solution that makes sense for thousands of business owners in Canada

Business loans , when it comes to a line of credit provide owners/financial managers with the challenge of financing working capital needs. While the majority of companies in the SME sector want to rely on Canadian chartered banks for these needs ' Asset Lending' has emerged as an alternate - and quite often easier to achieve. We're ' unboxing ‘ABL (asset based lending) for your consideration. Let's dig in.

The easiest way to think of an asset based credit line is to simply take a look at your balance sheet. The total assets you have in receivables, inventory and equipment are essentially your ' box' of assets that are margined under a new separate non bank line of credit facility. ( While banks also offer this type of lending more often than not it's for transactions in the 5-10 Million dollar range and up, obviously eliminating many firms in the SME sector who typically have revenues in that range, not assets!)

So while our banks focus on what they do best - addressing cash flow and risk and outside collateral and guarantees, the asset lending model looks to the main source of fluctuating repayment - your sales and your assets. (Sales create receivables) The majority of asset loans tend to reflect a higher amount of risk as companies in the SME sector ( Most define this as firms with under 25 Million $ in sales ) typically present a higher risk rating when it comes to overall credit quality .

While asset based lending solves problems of high growth and erratic profits and balance sheet structures it also can address problems such as financial distress. Notably it is also used in many situations in acquisition financing, as it allows you to monetize the assets of the target firm.

How does the asset lender offering these types of business lines of credit then manage the overall risk - allowing them at the same time to offer higher levels of financing than you typically could achieve from a bank? The answer - specialized knowledge of the true value of your assets as well as placing a higher value on more regular reporting of asset categories such as a/r, inventory , and equipment values .

Equipment becomes a component of your credit facility, and is almost always subject to an appraisal. Rarely will a bank lend against fixed assets as a part of your revolving credit line - the asset based lender will.

Successful business owners/mgr's will always be open to checking out newer forms of financing that might assist in growth and profits. If you're looking to ' unbox’ new types of business credit alternatives seek out and speak to a trusted, credible and experienced Canadian business financing advisor who can assist you with your needs.

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 100 Million $ of financing for Canadian corporations . Info /Contact :

7 PARK AVENUE FINANCIAL = CANADIAN BUSINESS LINE OF CREDIT AND LOAN EXPERTISE



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 '

ABOUT THE AUTHOR
Stan has had a successful career with some of the world’s largest and most successful corporations.
Prior to founding 7 Park Avenue Financial in 2004 his employers over the last 25 years were, ASHLAND OIL, ( 1977-1980) DIGITAL EQUIPMENT CORPORATION, ( 1980-1990) ) CABLE & WIRELESS PLC,( 1991 -1993) ) AND HEWLETT PACKARD ( 1994-2004 ) He is an expert in Canadian Business Financing.

Stan has over 40 years of business and finance executive experience. He has been recognized as a credit/financial executive for three of the largest technology companies in the world; Hewlett-Packard, Digital Equipment and Cable & Wireless. Stan has had in depth, hands on experience in assessing and evaluating thousands of companies that are seeking financing and expansion. He has been instrumental in helping many companies progress through every phase of financing, mergers & acquisitions, sales and marketing and human resources. Stan has worked with startups and public corporations and has many times established the financial wherewithal of organizations before approving millions of dollars of financing facilities and instruments on behalf of his employers.





Stan Prokop

The Best Business Revolving Credit Line Is Actually A Choice For Canadian Companies

Business Credit Lines Are A 4 Lane Highway : Which Lane Are You In ?

OVERVIEW – Information on business choices within the need for a business revolving credit line . What types of financing work best are what are some of the cost and operating issues in bank and non bank corporate credit facilities

Business revolving credit line needs are a necessity for almost all Canadian businesses in the SME Commercial sectors of the economy. But did you know that this type of credit / borrowing facility is actually a 4 lane highway. The challenge? Which lane are you in? Let's dig in.

Why does business prefer revolving facilities? It's probably because they have maximum borrowing flexibility and it's established once up front.

Your business might not need a line of credit if you're one of the lucky ones that actually have ' negative working capital ‘, which is in effect a cash type business where you collect monies before you pay suppliers, etc . Examples might be an internet retailer or certain retailers. But that's the rarity of course and the category your company probably does not fall into.

So, as we asked, if biz credit lines are a 4 lane highway, which lane are you in?!
One of those lanes is a traditional Canadian chartered bank line of credit. It's in effect an open ended credit facility which your business draws on as needed. Given today’s low rates its maximum flexibility at lowest cost - if you qualify! (Miscellaneous fees typically apply) .Security for bank credit lines is typically an all encompassing security agreement (‘GSA’) and guarantees of the others. Potentially outside collateral is also required, as well as the potential requirement to maintain certain minimum account balances. Typical bank advances for receivables are 75% of your accounts that are less than 90 days old.

Let's not also forget that banks and other commercial lenders typically will ask you to maintain certain financial ratios and covenants when it comes to your balance sheet or cash flow. Failure to meet those makes you ' off side'!

A 2nd type of revolving credit line is a more basic solution. It's A/R financing on its own, often called ' Factoring' but coming with many additional ' flavors ‘. In many forms of factoring you will be required to have your clients notified of the whole process - with client payments going to the lender. To avoid this somewhat ' undesirable ' process we recommend a better solution to clients: CONFIDENTIAL RECEIVABLE FINANCING. This form of ' factoring' allows you to bill and collect your own receivables with no notification to others. Canadian business owners no doubt love this type of control.

Key benefits of A/R financing inlcude the fact that no credit limit is set on your business - it fluctuates with your sales revenue. Typically higher costs come with this type of financing, but the benefits are significant - unlimited cash flow potential to grow your business.

A 3rd lane on our business credit line highway is the 'ABL ' Asset based business line of credit. This facility, offered by both banks and more notably commercial finance firms allows you to borrow under one facility based on the total ongoing value of your A/R, Inventory and Fixed Assets. Borrowing advances are therefore much more generous, and it’s very common to double your borrowing power under ABL facilities as compared to a bank fixed credit limit.


Our 4TH lane on the business credit line highway includes your ability to access numerous miscellaneous single solutions to working capital borrowing - they inlcude inventory finance ( suited to retailers /distributors ) , tax credit financing for SR&ED claims, PO Financing, and Royalty finance .

Which lane on our business credit line highway does your firm belong in? 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 finance needs.



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 100 Million $ of financing for Canadian corporations . Info /Contact :

7 PARK AVENUE FINANCIAL = CANADIAN REVOLVING BUSINESS CREDIT LINE EXPERTISE





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 '

ABOUT THE AUTHOR
Stan has had a successful career with some of the world’s largest and most successful corporations.
Prior to founding 7 Park Avenue Financial in 2004 his employers over the last 25 years were, ASHLAND OIL, ( 1977-1980) DIGITAL EQUIPMENT CORPORATION, ( 1980-1990) ) CABLE & WIRELESS PLC,( 1991 -1993) ) AND HEWLETT PACKARD ( 1994-2004 ) He is an expert in Canadian Business Financing.

Stan has over 40 years of business and finance executive experience. He has been recognized as a credit/financial executive for three of the largest technology companies in the world; Hewlett-Packard, Digital Equipment and Cable & Wireless. Stan has had in depth, hands on experience in assessing and evaluating thousands of companies that are seeking financing and expansion. He has been instrumental in helping many companies progress through every phase of financing, mergers & acquisitions, sales and marketing and human resources. Stan has worked with startups and public corporations and has many times established the financial wherewithal of organizations before approving millions of dollars of financing facilities and instruments on behalf of his employers.



Stan Prokop

Cash Flow / Finance Working Capital Challenges : A Really Complete Explanation On Cash Flow Solutions

Superintelligent AI Is Not Needed For Accessing Reasonable Working Capital & Cash Flow Solutions

OVERVIEW – Information on cash flow solutions for Canadian business. The ability to finance working capital separates winners from losers in business financial success

Cash flow for Canadian businesses and the ability to finance working capital is a top priority for successful companies - of any size - start up, SME, or large corporation. Let's examine how and why companies need and use working capital - and by the way it doesn't require superintelligent artificial intelligence! Let's dig in.

In truth the ability to finance your business on a day to day basis means different things to different owners/managers and how they address the challenge differs often. The essence of successful short term financing for your business is ensuring your ' current assets ' - cash / A/R / inventory are turned and financed properly. The ability to both run your company and plan for growth is what cash flow is all about.

Unexpected cash flow needs always pop up in business - some call it ' seasonal bulges ‘, in other cases it might be new or large orders/contracts. Retailers planning for seasonality is a solid example. The goal? Simply to have enough cash on hand to meet your obligations.

One of the great surprises ( and by the way it shouldn't be !) is that fast growing sales and profits can actually lead to a business failure for the simple reason that working capital needs consume cash as you build up inventories, buy new assets, and grow your a/r . Firms that invest in longer term assets and projects should consider:

Equipment Financing

Working Capital Term Loans

Cash Flow financing

to address their long term plans.


Firms that invest in R&D and who are not public companies should take strong advantage of the governments SR&ED program - and by the way these refundable tax credits can be financed for short term working capital - eliminating the need to wait for your claim.

By the way, it's unfortunate that many business owners/mgrs, most often in the SME sector, seem to think they can use CRA obligations to finance their working capital needs. This often leads to disastrous consequences, given the heavy hand that CRA can hold over a business based on unpaid ' superpriorities'.

A good way to always consider how and why you need to finance your working capital is to simply view the need for positive working capital as the right balance of any debt you have combined with your owner equity. The problem? Companies in the SME sector, including start ups of course often can/t raise equity or debt to the extent they need it.

Mistakes in cash flow financing are often made when firms don't match short term finance solutions with short term needs.

Short term financing solutions to be potentially considered are:

Chartered bank facilities for business credit lines - these open ended ' loans' provide great liquidity at good rates and maximum limits are typically established

Commercial finance A/R financing

Asset based non bank business lines of credit - A solid way to finance assets and generate cash flow based on your sales and assets - it is the non bank alternative to cash flow

SR&ED tax credit financing

PO/Contract financing

If you're looking to finance working capital and cash flow needs with traditional or alternative solutions that make sense for your business 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 needs.

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 100 Million $ of financing for Canadian corporations . Info /Contact :

7 PARK AVENUE FINANCIAL = CANADIAN WORKING CAPITAL AND CASH FLOW FINANCING EXPERTISE



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 '

ABOUT THE AUTHOR
Stan has had a successful career with some of the world’s largest and most successful corporations.
Prior to founding 7 Park Avenue Financial in 2004 his employers over the last 25 years were, ASHLAND OIL, ( 1977-1980) DIGITAL EQUIPMENT CORPORATION, ( 1980-1990) ) CABLE & WIRELESS PLC,( 1991 -1993) ) AND HEWLETT PACKARD ( 1994-2004 ) He is an expert in Canadian Business Financing.

Stan has over 40 years of business and finance executive experience. He has been recognized as a credit/financial executive for three of the largest technology companies in the world; Hewlett-Packard, Digital Equipment and Cable & Wireless. Stan has had in depth, hands on experience in assessing and evaluating thousands of companies that are seeking financing and expansion. He has been instrumental in helping many companies progress through every phase of financing, mergers & acquisitions, sales and marketing and human resources. Stan has worked with startups and public corporations and has many times established the financial wherewithal of organizations before approving millions of dollars of financing facilities and instruments on behalf of his employers.







Stan Prokop