ABL Lenders In Canada : How To Solve The Hunt On Your Business Credit Line & Banking Dilemma

Feeling A Tad ‘ Underbanked’ These Days ? Here’s A Call To Action

OVERVIEW – Information on how Canadian business can access the business credit line . These facilities are offered by bank and commercial ABL lenders and provide a constant cash flow source for the business

The business credit line requirement often has owners/ financial mgrs feeling somewhat ' underbanked’. This type of facility is only offered by either a bank or ABL lenders. (Asset Based Lending). Take us up on our ' call to action '

and let's end that hunt for that constant cash flow dilemma that you face. Let's dig in.

Let's cover off some basics. These types of facilities allow you daily access to capital as you need it. It's a ' pay as you go' type of borrowing that only charges interest as you access the credit - with the ability to pay it down all the time, typically daily as you collect receivables, etc.

Typical uses of the credit lines include payrolls, marketing, inventory purchases, and most importantly - filling the time gap between sales and collections!

Two key offerings are available in Canada - Banks and Non bank lenders. Banks offer secured and ' unsecured' revolving facilities - typically non bank lenders are fully secured by security agreements covering collateral assets such as A/R, inventory, and often equipment, and of course owner guarantees. The best use of the credit line is when your company pays down and fluctuates the facility regularly.

Typically bank lines are not available to newer or start up businesses, and they are not a source of covering your financial losses/business errors.

While the ' unsecured' credit line is highly appealing you need to understand that your overall business record and financials must be very strong and at a certain point based on dollar requirements typically security is requested. You must demonstrate profits, good financials, and a command of your business. (Financial statements tell almost all about whether you're ' in command ‘)

Key point: Term loans are fixed in nature and usually are for specific assets. They are NOT credit lines per se, the latter having more flexibility. Note however that credit lines almost always have a limit!

To access the right amount of revolving credit facility you should be able to produce on an ongoing basis proper schedules of A/R, inventory, and other obligations your business has committed to. A cash flow forecast is ALWAYS helpful. You want to be able to demonstrate how and why the credit lines will assist you in running and growing your business.

While bank facilities are ' lowest cost ' they are more challenging to secure. Asset based lenders offer more credit but come at a much higher cost -although those costs have come down substantially in the last few years due to the highly competitive nature of the business.

If you're feeling ' underbanked' these days and want to access more, or better suited credit facilities seek out and speak to a trusted, credible and experienced Canadian business financing advisor who can help you achieve the flexibility and ' gap covering' that your business requires.


Stan Prokop - founder of 7 Park Avenue Financial –

http://www.7parkavenuefinancial.com

Originating business financing for Canadian companies , specializing in working capital, cash flow, asset based financing . In business 10 years - Completed in excess of 100 Million $$ of financing for Canadian corporations . Core competancies include receivables financing, asset based lending, working capital, equipment finance, franchise finance and tax credit financing.




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 Cash Flow & Working Capital Funding In Canada : The Money Bottom Line!

Everything You Thought You Knew About ‘ Business Money ‘!

OVERVIEW – Information on business cash flow and working capital funding in Canada . Do finance and money needs remain a top priority

Funding working capital needs for Canadian business comes with both legal , often personal ramifications, and of course costs. Some call it business cash flow, we can even refer to it as ' business money ' - The reality is that the movement of money/funds through your company has some dramatic implications. Let's dig in.

What’s bugging you ? As one top expert recently put it business owners/ financial mgrs find themselves constantly ' bugged' by the cash flow financing challenge. While the might be comfortable with sales and those ' paper profits' their ability as owners to access real cash for corporate and personal needs becomes a constant challenge.

One' rule of thumb' in business is to always have a buffer against unexpected cash needs. Not having those creates constant pressures that come from suppliers, your bank, even staff.

Bank business lines of credit are of course one of the optimal ways to achieve cash flow needs. Some clients we meet are actually in arrears with CRA due to those liabilities being ' rearranged ' for other purposes. That strategy by the way has some serious ' personal guarantee ' issues and is not recommended.

Many business financing alternatives such as:

A/R Financing
Inventory loans
PO Finance
SR&ED tax credit loans

can alleviate ' bulge' needs in business cash flow. Whether ' temporary' or ' seasonal' it's good to know your alternatives.

Stats tell us that a large majority of business owners in Canada spend more each subsequent year on replenishing or purchasing fixed assets. Here's it good to understand your equipment lease financing options as those capital expenditures can take a large bite out of working capital if allocated improperly.

Those ' CAPEX ' needs will always arrive with three questions -

How much can we spend on new assets/technology?
How much internal funds can be used for asset purchases
What outside financing is available?

What then are some solid key considerations in understanding your business cash flow?

They include:

Understanding your real profits

Why are receivables and inventory going up without the same increases in sales?


What options are available to finance new assets

The whole area of working capital, and in particular cash flow is a very misused term as its often neither real ' cash ' , or real ' flow '! If you're looking for straight answers on ' business money ' and company financing techniques and solutions 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 funding your business properly .






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

How To Finance & Acquire An Existing Company : Business Acquistion 101!

Looking For Acquisition Financing ? Try This

OVERVIEW – Information on how buyers can acquire a company . The ability to successfully finance a business acquisition is key to winning when buying a company or merging your business into one

Acquire a company ? That’s one way to beat the ‘organic growth ‘path to business success and it can be a proven strategy ... when done properly. How then does the owner/entrepreneur successfully finance a business acquisition? Some experience in the area helps - given that difference sources of finance in this area demand different approval criteria. Let's dig in.

When buying / acquiring a business, or merging your business into another (That’s the 'M ' in m&a) it’s important to visualize the ultimate structure of the company. While it's preferable that your target business has little or no debt, strong cash flow, and valuable assets the reality is that's not always going to be the case. Therefore different types of financing are required to shore up the overall ' business valuation’

As we have said in the past, financial statements don't provide a ' magic number '

for value, but properly completed (and available) they should show you the cash flow situation of the business. Again, the past is not the future, so careful examination of future financial potential is key.

Buyers must also determine if they are buying the ' shares' of the business, or the ' assets'. There's a big difference in tax obligations here and this is where it's best to consult your lawyer or external accountant. Sellers need to take into consideration the fact that there is no real ' market ' for private company shares. The buying and selling of businesses relies then on proven ' formulas' for valuing a business.

Those valuations typically include giving a multiple to cash flow, profits, sales, or some combination of those. In some cases it's all about the ' assets ' of the business, so both a buyer and seller would benefit from a third party independent appraisal. While sellers will maintain an overall ' glossy ' outlook on assets.... it's buyer beware when it comes to sellers risk. Example: Specialized assets

The quality of the financials and the performance of the business historically dictate what type of financing you will need to complete a transaction. Poor profits, high levels of debt, and other operational deficiencies will dictate finance solutions. Ultimately understanding the working capital and assets are key. Remember also that in the small to medium enterprise area ' GOODWILL ' is rarely if ever financeable.

Oh and by the way the ability to ' sell yourself ' as a manager with skills is key.

Let's get back to our actual finance solutions. They include:

Canadian chartered banks

The Govt of Canada guaranteed ' Small Business Loan'

Asset based loans and lines of credit

Sale leaseback strategies on owned assets


Unsecured cash flow term loans

Seller financing participation - i.e. the 'VTB'

Buyer equity

While larger deals might be able to secure private equity or a public listing for financial success the real meat and bones of the small to mid market area of acquisitions relies on those 7 strategies ( or combinations of them ) that we highlighted above.

If you're looking for expert help and real world financial solutions to buying a 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 in your business acquisition finance needs.


Stan Prokop - founder of 7 Park Avenue Financial –

http://www.7parkavenuefinancial.com

Originating business financing for Canadian companies , specializing in working capital, cash flow, asset based financing . In business 10 years - Completed in excess of 100 Million $$ of financing for Canadian corporations . Core competancies include receivables financing, asset based lending, working capital, equipment finance, franchise finance and tax credit financing.
Info & Contact Details :



7 PARK AVENUE FINANCIAL = CANADIAN BUSINESS ACQUISITION 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

Fax = 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

Buying A Company : Acquisition Financing Methods And Options In Canada’s SME Sector

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Key Points To Consider When Buying and Financing An Existing Business In The Small & Medium Enterprise Sector

OVERVIEW – Purchasing or buying a business isn’t just for BIG business . Understand your acquisition and financing methods and options if you’re buying an existing company

Company acquisition financing methods & options are the method by which Canadian business owners/mgrs successfully complete the pursuit of a desired business purchase. Things go awry when the right expertise and finance terms are not achieved. What are essential points and strategies to successfully complete buying a company? Let's dig in.

One of the larger mistakes purchasers make is to focus solely on the ' price / value ' of the company you are looking at. The reality is that financial statements that accountants prepare never are intended to figure out the ' value ' ' price ' of the company. (They do however hopefully reflect the profits and assets of the business)

Successfully getting financing approved and in place to purchase a business is a well known challenge. Larger corporations of course use the capital markets, the deep pockets of public 'cash rich' companies, or Private Equity firms to facilitate a transaction. The SME sector demands a lot more creativity but still offers some solid options for achieving your goal.

The key options to finance your business purchase will probably include one of the following:

The Govt of Canada Guaranteed Small Business Loan - (The ' SBL ‘)

Asset based Loans & Lines of Credit

Unsecured Cash Flow Loans

Vendor / Seller Participation in the Transaction

Mezzanine finance which typically also comes with a small equity participation request

Also, in many cases strategies that include equipment financing and leasebacks and A/R finance may well round out a transaction

Don't forget that in almost all instances some level of owner equity participation will be desired by almost all lenders.


While Canadian chartered banks of course facilitate these transactions their lending criteria has been modified and somewhat tightened since the global 2008 financial collapse.

The key issues in business purchase finance? They are: profits, cash flow, assets, and debt levels. Those 4 criteria will determine the amount and type of financing you need.


Your ability to successfully buy an existing company will come down to the amount of time and expertise you have in ensuring you have explored the right financing options. 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 completing your business purchase.


Stan Prokop - founder of 7 Park Avenue Financial –

http://www.7parkavenuefinancial.com

Originating business financing for Canadian companies , specializing in working capital, cash flow, asset based financing . In business 10 years - Completed in excess of 100 Million $$ of financing for Canadian corporations . Core competancies include receivables financing, asset based lending, working capital, equipment finance, franchise finance and tax credit financing.
Info & Contact Details :

7 PARK AVENUE FINANCIAL = CANADIAN BUSINESS ACQUISITION FINANCE 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

Fax = 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

Loan And Finance Sources In Canada : Business Financing Done Right!

Business Financing – What Could Possibly Go Wrong ?

OVERVIEW – Information on finance sources in Canada. Business Financing and loan needs come with a requirement to understand needs and sources of capital that match requirements

Business financing in Canada , executed improperly, has the possibility to go really wrong! So when it comes to finance sources and loan needs it's critical to have a solid ' lay of the land' to ensure your company is going in the right direction for survival and growth. Let's dig in.

In Canada there is somewhat of a line down the middle when it comes to the types of capital available - it really comes down to ' traditional’, or ' alternative. Those seeking alternative solutions demand more flexibility to the alternative of Canadian banks, and credit unions. Those banks of course have low rates, unlimited capital for your business, but tougher qualifying criteria - all for the right reasons of course.

The irony of the business landscape is that those firms needing financing the most are in fact the majority of the economy these days!

While business owners / financial mgrs associate government with our category of ' traditional' finance they often overlook two solid sources of funding in this area - Govt guaranteed business loans , and Canada's ' SR&ED program . Recent limit changes in the Gov't SBL program make the program very desirable for start ups and earlier stage companies. Additionally SR&ED credits allow firms to recoup in the area of 40% of their R&D activity, and these credits are financeable!

When we talk about things ' going wrong ' it's important to note that any early stage companies work the Angel investor/VC angle. The reality is that only the smallest % of firms really qualify for this type of financing, and the majority of those are in the tech/pharma area.

Some stats indicate that over 40% of all firms applying for the financing they need from ' traditional' sources are in fact declined. So then, given the need for capital for that ' running/growing' of the business what then are some alternative options.

The key alternatives include:

A/R non bank financing

Purchase Order/Contract Finance

Cash flow loans - Secured/unsecured

Royalty Finance

Working Capital Term Loans - 2nd position loans that provide cash for long term working needs

ABL's - These are non bank business lines of credit that bundle a/r, inventory and equipt into one daily accessible revolving credit facility

To make the right financing decision it's important to distinguish between debt financing and cash flow finance. When assets are being acquired owners/mgrs need to consider equipment financing or term loans. Funds for this category should typically not come from operating cash flow.

If you're focused on doing things right and proactively closing on your finance needs seek out and speak to a trusted, credible and experienced Canadian business Financing Advisor with a track record of success
who can help you address our key question ' What Could Possibly Go Wrong'!


Stan Prokop - founder of 7 Park Avenue Financial –

http://www.7parkavenuefinancial.com

Originating business financing for Canadian companies , specializing in working capital, cash flow, asset based financing . In business 10 years - Completed in excess of 100 Million $$ of financing for Canadian corporations . Core competancies include receivables financing, asset based lending, working capital, equipment finance, franchise finance and tax credit financing.
Info & Contact Details :

http://www.7parkavenuefinancial.com/business-financing-loan-finance-sources.html


7 Park Avenue Financial

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

Office = 905 829 2653


Fax = 905 829 2653


Email = sprokop@7parkavenuefinancial.com

' Canadian Business Financing with the intelligent use of experience '

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 Finance : Up And Running Strategies For Your Loan And Funding Needs

Looking For Business Financing To Prevent The Terminal Event of Business Failure ? These Solutions Just Might Help

OVERVIEW – Information on business finance solutions and strategies. Funding via loans or asset monetization is key to success in corporate survival

Business finance strategies require some serious investigation and consideration in the asset funding and loan needs of any company. The reality is that every company is in a different stage of growth or success, therefore requiring different solutions. Lack of, or improper solutions lead to what we've call that ' terminal event ‘... business failure. Let's dig in.

While working capital needs often measure business success because they typically reflect sales growth and 'paper profits ' the reality is that it always comes back to cash flow as the ultimate measure of success... and by the way.. survival.

While the optimal goal is to have some sort of ' cash reserve ‘, or at least access to that cash via a business line of credit those two goals are not always attainable. It's important to note that almost always some simple cash flow ' forecasting' can help identify future bulges in cash and financing needs.

Compounding the problem is the fact that many industries require different levels of capital expenditure and working capital investment. The winners in this category are ' service companies' who require much less spending to attain sales revenues. This is as opposed to mfr's who invest in equipt and inventory and have a longer cash cycle.

In some cases your firm might be investing in R&D which forces an even longer business cycle. When we meet clients facing R&D capital needs we encourage them to take advantage of Canada's SR&ED program which allows to you recover a large portion of your research spend. By the way those refundable tax credits are financeable and allow you to aggressively accelerate that cash outflow back into your bank account!

When financing becomes a key consideration many owners don't want to look to new equity, thereby ' diluting' their ownership.

Companies who don't focus on managing their receivables and credit will find themselves in those ' dire straits' that can unfortunately lead to our ' terminal event '. If bank lines aren’t available then owners/financial mgrs should consider A/R financing or Asset based non bank lines of credit. These types of facilities allow you to draw against ongoing sales and receivables. They don't work when your sales are in a death spiral or if you're not focusing on good collection turnover.

Remember also that new cash coming into your firm will only comes from a handful of resources, namely collecting your sales receivables, borrowing, and efficient use of supplier credit.

The ' cash gap ' can be filled by debt , equity, or monetizing existing assets via sources of funding such as A/R finance, equipt leases and loans, sale leaseback of assets, working capital term loans, or exploring the possibility of unsecured cash flow loans.

If you're focused on 'avoiding ' our terminal event through the use of proper financing solutions and techniques 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 ' up and running'

cash flow and business finance.


Stan Prokop - founder of 7 Park Avenue Financial –

http://www.7parkavenuefinancial.com

Originating business financing for Canadian companies , specializing in working capital, cash flow, asset based financing . In business 10 years - Completed in excess of 100 Million $$ of financing for Canadian corporations . Core competancies include receivables financing, asset based lending, working capital, equipment finance, franchise finance and tax credit financing.
Info & Contact Details :


7 PARK AVENUE FINANCIAL = CANADIAN BUSINESS FINANCE 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


Fax = 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 Financing : You Have To Deal With Accounts Receivable & Here’s How

Ready For A Gabfest On Cash Flow Financing ?

OVERVIEW – Information on accounts receivable and cash flow financing solutions in Canada

Cash flow financing in Canada requires that business owners/financial mgrs take a positive outlook on how they finance... and manage their ongoing accounts receivable investment. Many aspects of this subject are somewhat misunderstood... so welcome to our ' gabfest ' on this area of business financing.

It's commonly accepted that a positive cash flow in a business is king (or queen). The ability of your firm to on an ongoing basis acquire and pay for assets, meet payrolls, and bring down outstanding debt levels is of prime focus to your company.

While there is a fairly big distinction between running your business day to day versus growing your company on a long term basis different types of financing are required for each of those two categories of a company's maturity. While happiness means different things to business owners clearly most would agree that happiness factor in owning or running a business can be measured by positive cash flow.

Of course your company could adopt a ' not for profit '

and negative cash flow stance but that will only lead to insolvency, highlighting the importance of running and financing your business properly.

Cash flow is such a broad term in business it has the ability to be misunderstood fairly often. Financial analysts/textbooks define it as ' net income plus depreciation’. By the way depending on the amount of depreciation of your assets company losing money or trending downward can actually have positive cash flow - however we don't recommend that as a strategy!

A great business mystery

to many owners is why ' paper profits' look great but a daily cash flow crisis occurs... daily! Often the reason? Your investment in accounts receivable! The ' cash poor ' feeling relates to the payment habits and ability of your clients, and the ability to manage that process/function. And if your company is cash flow intensive that requires funds to be spent on inventories, equipment, etc.

How then do owners/ financial mgrs finance their A/R investment? Solutions include:

Bank credit lines

Accounts Receivable non bank financing solutions such as factoring - Our recommended solution in this area is CONFIDENTIAL RECEIVABLE FINANCING , allowing you to bill , collect and finance your A/R investment without notification to any clients, suppliers, etc

Asset based non bank business lines of credit, allowing you to create a business line of credit facility based on any combination of A/R, inventory, and even owned equipment

The goal in these solutions - generate more, or at least as much! business cash flow as you are spending.

Looking for a clue as to whether you are winning, or losing this battle ? Take a good look at your cash flow statement provided by your accountants. Page 3 is the cash flow statement - focus on cash flow from operations. If that number is negative you should be addressing a fix.

That's our ' gabfest ' on the importance of accounts receivable and cash flow financing. If you're looking for financing solutions and tools to 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.



Stan Prokop - founder of 7 Park Avenue Financial –

http://www.7parkavenuefinancial.com


Originating business financing for Canadian companies , specializing in working capital, cash flow, asset based financing . In business 10 years - Completed in excess of 100 Million $$ of financing for Canadian corporations . Core competancies include receivables financing, asset based lending, working capital, equipment finance, franchise finance and tax credit financing.
Info & Contact Details :


7 PARK AVENUE FINANCIAL = CANADIAN ACCOUNTS RECEIVABLE 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

Fax = 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