Financing Research And Development Tax Credits : SRED Finance Is The Easy Part Of Your R & D

The Short (And Long ) Answer is ‘ Yes ‘ : SR&ED R&D Tax Credits Can Be Financed

OVERVIEW – Information on financing refundable research and development tax credits in Canada. SRED Finance loans monetize your claim and provide .. cash flow today!

Financing research and development (R&D) tax credits in Canada is really the end to a successful outcome of your SR&ED claim. There's been a healthy dose of ' no you can't ' when it comes to a lot of the changes in the program over the last several years. SRED Finance loans are the positive monetization of your claim - in effect the easy part! Let's dig in.

Most Canadian business owners and financial managers who participate in the benefits of the program probably though do realize that for a program that has been around close to 30 years there was probably some ' Times They Are A Changing' ) that were due . (Apologies to Bob Dylan who it turns out wasn’t writing about refundable tax credits)

While top experts and pundits maintained the program was ' broken ' it nevertheless continued to fund Billions of dollars every year for thousands of firms enhancing their business prospects through research. Anything that involves both provincial and federal governments is of course going to evolve.

Participants in the program of course know the basics - it's all about proving some sort of technological advancement. Here it’s about documenting your spend on fixing ' uncertainty ' and trying to progress to ' technological advancement’


After your claim has been filed you're in a strong position to... you guessed it... wait! That waiting can be totally eliminated by utilizing a SR ED bridge loan to monetize your filing, accessing your cash now... instead of weeks, months, or longer? based upon whatever status your claim is in with Canada Revenue. In some cases that of course might be financial or technical audit, in other cases just the bureaucracy that comes with those nice folks in the government.

How then does a SR&ED loan work? It could not be simpler and in fact we maintain that if there’s been changes to the financing of the program they have all n fact been quite positive! SRED loans are financed as bridge loans. You receive 70% of the total value of the claim on approval of the loan. The key collateral of the loan is, as you might surmise, your SR ED.

No payments are made for the duration of the loan, and when claims are finally approved you receive the balance immediately less financing costs which are mezzanine in nature due to the risk profile of this type of financing.

Financing research and development tax credits is a pretty easy decision - it boils down to:

Do you need the cash today and what use can be made of the funds? It's really the ' opportunity cost ' that you are looking at. Funds of course can be used for what the accountants call ' any general corporate purpose ‘. That of course includes operating financing, purchasing new assets, or doing more R&D!

Oh by the way, even next years claim can be financed today if you have a track record or can demonstrate a quality claim with your SR&ED consultant.

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 financing needs in research tax credits. It's the ' easy ' part of research.




Stan Prokop - 7 Park Avenue Financial :

http://www.7parkavenuefinancial.com

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

7 PARK AVENUE FINANCIAL = CANADIAN SR&ED CLAIM 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

Cash Flow Financing In Canada : Reducing Working Capital Finance Challenges

How To Make A Success Story Of Your Business Cash Flow

OVERVIEW – Information on cash flow financing strategies and solutions in Canada . Working capital finance can more easily be accessed with this information





Cash flow financing in Canada is rarely termed a great success story by Canadian business owners and financial managers. How can working capital finance challenges be reduced? Let's dig in.

Numerous factors affect your ability access the right amount of funding you need to run your business. Profit or the amount of it is certainly one of them. Many firms are profitable, but only marginally - and in a lot of cases we see with clients those profits fluctuate tremendously year over year.

Turning profits into cash flow is of course another story. In traditional ' bank lending ' it’s a strong requirement, as opposed to alternative financing which often focuses on assets and collateral in your business. And every business owner knows that in the SME ( small to medium enterprise ) sector most times a personal guarantee of some sorts is of course required. Those personal guarantees are a discussion for another day.

Let's recap traditional and less than traditional methods of financing cash flow and working capital. They include the following:

Traditional Canadian chartered banking - credit lines/term loans

A/R financing

Inventory financing

Working capital term loans

Government Small business loans - structured as term loans but with maximum flexibility around payment

Asset based lines of credit - (These ' ABL''s transform all your business assets into one revolving credit line

Tax Credit Monetization

Unsecured cash flow loans, often terms ' sub debt' or ' mezzanine’

Sale leasebacks of owned assets - this might include assets in one of two categories - equipment and real estate

In some cases it makes sense to form some kind of cash flow contingency plan that might include various forms of ' bulge financing ' solutions, or approaching suppliers and lenders for a payment moratorium of sorts. Those are tough to do, by the way.



Unfortunately many clients we meet don't always have a handle on their financial performance. In some cases they are ' rear focused' , having only historical data , which is challenging if no financial forecast or financial statement strategy is in place re reporting and analyzing.

Businesses with a handle on financial performance have much greater credibility with lenders; it’s as simple as that.

Remember also that while cash flow financing solutions are the fix from an external perspective it makes even greater sense to manage your assets to create internal cash flow.

That is done by having strong A/R controls and turning inventories over faster if inventory is a key part of your business. Naturally financial statement tools and other forms of business software greatly aid the business owner/finance mgr today. Knowing your DSO (day’s sales outstanding) and inventory turns and days outstanding payables is a fundamental you must know to be successful. Watch the business news on TV at night and you'll notice the ' big boys ‘, those major successful corporations always have a handle on these numbers , They're the key elements of the cash flow operating cycle.


If you're looking to be a SUCCESS STORY in your mind (or that of your competitors) seek out and speak to a trusted, credible and experienced Canadian business Financing Advisor with a track record of success who can help you reduce those cash flow and working capital challenges.


ABOUT THE AUTHOR:
Stan Prokop - 7 Park Avenue Financial :

http://www.7parkavenuefinancial.com

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


7 PARK AVENUE FINANCIAL = CANADIAN CASH FLOW FINANCING EXPERTISE



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

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

Direct Line = 416 319 5769

Office = 905 829 2653



Email = sprokop@7parkavenuefinancial.com






' Canadian Business Financing With The Intelligent Use Of Experience '

Stan Prokop

Franchising Loans In Canada : Top Franchise Financing Tips Explained

Unlocking Franchise Financing Secrets In Canada

OVERVIEW – Information on franchising loans in Canada . What franchise financing strategies are available to the prospective franchisee

Franchising loans in Canada, properly obtained and constructed, help guarantee entrepreneurial success for prospective franchisees. We're going to unlock some of those ' secrets’ to help ensure that success story. Let's dig in.

We can categorically say, notwithstanding the tremendous growth in franchising in Canada, that there's no ' easy money ' on the table when it comes to this type of loan or finance solution. In fact, we can safely say that many of the requirements of any business loan apply to almost all franchise scenarios.

So it becomes a question of leverage ( the amount of debt ) the franchisee can take on, the collateral value of assets being financed ( equipment, leaseholds, real estate, rolling stock ) as well as the business experience of the owner .

Often overlooked, or simply forgotten, is the franchisee's ability to misgauge the working capital and growth financing that might be needed post acquisition. While in some cases it might be assumed your business will lose money in the early stages it clearly makes sense to focus on cash flow and profitability from day one.

We meet with many franchisees who are interested in, or in the process of acquiring an existing franchise. Getting past the fact that the franchisor itself must approve this type of sale it's absolutely critical to determine what levels of success (or distress) that business was experiencing pre purchase. This necessitates a strong look at existing financials, personnel, and market conditions re location, industry growth, etc.

While it might seem logical that Canadian chartered banks are the predominant financier of franchises in Canada this might actually not be the case. While the banks do in fact align themselves with the big names in the business those franchises are often, for the obvious reasons, more expensive and require much more capital investment and personal financial commitment.

The reality in Canadian franchise financing? It's that most operations are financed by a small handful of specialty lenders, as well as those borrowers to choose to opt for the Government Small Business Loan (aka the ' SBL ‘). Other forms of supplementary financing are also utilized and available to borrowers - they include equipment lessors, term lenders for working capital loans, merchant advance cash flow financiers, and loans secured by personal assets of the franchisee, the latter not recommended.

If you're looking to be successful and wanting to navigate the tips and tricks of the franchise finance maze in Canada seek out and speak to a trusted, credible and experienced Canadian business Financing Advisor with a track record of success who can assist you on the journey to entrepreneurial success.




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 FRANCHISE LOAN 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 Based Financing : Are Business Credit Line Needs Causing You To Miss Out

Is Asset Based Financing The Better Way For Business Credit Line Needs

Information on the ABL business credit line . Asset based financing provides a solid alternative to ongoing working capital facility needs

Business credit line needs can often very well leave the Canadian business owner and financial manager feeling ' left out '. Asset based financing via an ' ABL ' line of credit can easily be called the ' better way ‘Let’s dig in.

Asset based lending, in our case in the form of a working capital facility is the ultimate in ' secured lending '. A laser like focus on your fixed assets and current asset accounts (receivables / inventory) transforms the true value of those accounts into ongoing cash flow.

It's that value in your business assets that allows companies in pretty well any industry in Canada to benefit from what we term a ' non bank line of credit '.

Almost any industry can benefit from Asset based financing, and in fact many industries seem almost perfectly positioned to use this type of borrowing. That includes mfg companies, wholesaling firms, retailers who have inventory financing needs, and even tech companies.

The essential difference in a Canadian chartered bank line of credit and an asset based financing facility is one is asset based (ABL) and one is more cash flow focused (the bank!). Bank facilities typically have ‘caps’, aka limits on the facility. The asset based credit line is more, shall we say ' elastic' in nature and really grows or contracts relative to your sales and working capital accounts.

Many companies, for a variety of reasons simply can't meet the stringent requirements of bank credit lines - which comes with very low rates, but requirements that are often onerous for firms that are in various stages of their life - that might be a turnaround scenario, or coming off a difficult year, or surviving, but paying the price of a one time incident such as the loss of a contract or key personnel.

It's those above mentioned typical scenarios that don’t allow firms to meet cash flow and balance sheet ratios required by bank lending. In some cases a lot of companies are subject to seasonality and cash flow ' bulge' requirements. It's the ability to also incorporate other assets into your credit line that assist in financing those ' bulges' in cash flow needs - seasonal or otherwise.

Because asset based financing for credit lines is almost always more expensive it's often a bridge to other forms of financing, think of it as a solid business band aid. If you're focused on getting business credit that meets your cash flow and financing needs seek out and speak to a trusted, credible and experienced Canadian business Financing Advisor with a track record of success who can assist you with your asset based financing needs.



Stan Prokop - 7 Park Avenue Financial :

http://www.7parkavenuefinancial.com

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


7 PARK AVENUE FINANCIAL = CANADIAN ASSET BASED FINANCING & 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





























Stan Prokop

Why The Equipment Lease Bravely Steps Up : Leasing Company Solutions Help Acquire Assets

Getting It Wrong Is Not An Option When It Comes To Asset Lease Finance

OVERVIEW – Information on what key concepts business owners and financial managers must address when constructing the right equipment lease with their chosen leasing company solution provider

Equipment lease solutions aid in acquiring assets. Simple as that. It's a solution that's used by a majority of businesses in Canada and the U.S. alike. But can you ' get it wrong ' when it comes to a leasing company choice. In some cases any mistake in financing an asset properly costs your firm time and money. Let's dig in.

Whether you're a public company, a government entity, or even a start up it's still important to give serious attention to how you're leasing and asset, who you are dealing with, and the rights and obligations you have in leasing equipt. in Canada.

Leasing is all about cash flow conservation, so some solid cash flow planning around projected monthly payments relative to the useful life of the asset.

Naturally no form of Canadian business financing is ' all inclusive ' and works all the time - so yes, alternative options do exist. They include loans or rentals, although rentals are in effect a form of the ' operating lease ' solution.

Picking the right term is critical as it relates to our cash flow mention, as well as being able to accurately determine the life of the asset. While longer term/amortizations are available typical lease terms are 2-5 years in Canada. Certain heavy equipment/aircraft/production equipment etc lends itself to much longer terms potentially.

It seems our clients always only want to talk about ' rate' ' interest rate' considerations on any transaction. That's all well and fine but the actual terms of the lease as well as type and structure are considered much more important by experienced lessors. At the end of the day your overall business credit quality (or lack thereof) will take care of the interest rate question, if only for the reason that the industry itself is very competitive these days!

It's that competitiveness that will allow you potentially negotiate critical customer concerns such as down payments that might be required, the dreaded ' personal guarantee', or end of term options such as upgrading, returning, extending the lease .

Many of our clients we initially talk to don't fully understand that ' capital lease' (i.e. lease to own) solutions are known as ' hell or high water ' contract, requiring you to make all the payments under the lease - i.e. no early terminations, etc.

Who in fact offers lease finance solutions in Canada. You'd be surprised at the number of players; they include some of our Canadian chartered banks, independent commercial lease firms, captive organizations within certain large manufacturers, and niche players. In some cases your lessor might be 100% Canadian, in other time it might well be a subsidiary or division of a U.S. organization. (Not that there's anything wrong with that!)

So is there any one way to guarantee you are aware of and selected the right lease structure and lessor? One possible solution is to seek out and speak to a trusted, credible and experienced Canadian business financing advisor who can ensure ' getting it wrong ' is not the option.




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 LEASE 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

Gov’t Guaranteed Loans In Canada : Winds Of Change In The Government Small Business Loan

The Great , The Good, And The Bad & Ugly On Changes In Government Small Business Loans

OVERVIEW – Information on recent (relatively !) changes in the government small business loan in Canada . Gov’t guaranteed loans provide solid business financing for thousands of businesses from start up to SME

The government small business loan has been, and continues to be a benchmark in start up and small business financing in Canada. Govt guaranteed business loans have had some changes, so it's time to ' plug in ' to these changes and how they impact the financing benefits of this program. Let's dig in.

Have you heard about those ' winds of change '

in ' SBL’ small business loans in Canada? The ' great ' news is that the fundamentals and purpose of the program clearly do not seem to have changed. That's probably recognition by INDUSTRY CANADA (they sponsor and manage the program) that the SME COMMERCIAL FINANCE sector in Canada generates a huge portion of employment, revenues, and... oh yes ....taxes!

So for over 50 years the program has delivered solid financing for businesses in all industries. Fundamentals of the program include the opportunity to start, grow, and expand your company. In many cases these loans are a direct substitute that our clients would normally not be able to successfully receive under ' traditional ' bank financing criteria. Those criteria are all too well known to the entrepreneur who arrives ' plate in hand ' looking for business financing or expansion capital.

Those winds of change that have entered the program do not affect the basic fundamentals - financing is available for start ups or established businesses with less than 5 Million dollars in projected or actual revenues respectively .

Assets that can be financed include equipment that is either new or used, or leasehold improvements to leased / rented premises. It's important for the business entrepreneur, financial manager to understand that those equipment categories are extremely broad. It includes rolling stock, such as trucks or other vehicles, computer, telecom, and application software, and even the ability to finance a franchise.

What can't you finance under a government guaranteed SBL loan? That's the painful news we often have to deliver to clients to have exhausted other financing options - that includes goodwill, credit lines, fees to purchase a franchise, or R & D costs in developing a product. ( Note - use the SR&ED program to finance and cash flow your research and development - these credits can be financed also ).

So what about those ' changes ' to the program? Although banks are chartered to fund and administer the program the bad news is that different banks tend to, by law, interpret the program differently.

Recent legislative changes to the program include the ability for fees to be charged by the bank, as well as personal guarantees to be required on a case by case basis. (Traditionally only 25% guarantees were required). We suppose those are the ' ugly ‘(as deemed by the borrower) portions of changes under the program.

If there's a bottom line it's certainly that most top experts agree that the Canada Small Business Loan program is still a clear winner for start up, franchise, and growth financing in the SME sector. 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 obtaining govt backed loans that meet your requirements.







Stan Prokop - 7 Park Avenue Financial :

http://www.7parkavenuefinancial.com

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





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

An ABL Revolver Credit Facility : Reasons To Consider This Business Credit Line

Which Of These Business Credit Lines Would Your Company Choose


OVERVIEW – Information on the business credit line knows as the ‘ abl revolver credit facility . Asset based lending is a solid alternative for these reasons provided

Business credit line solutions in Canada actually, believe it or not, come with choices. One choice is the ' ABL ' revolver credit facility; it’s the cornerstone of ' Asset Based Lending ' in Canada. What then are the reasons that Canadian business owners / financial managers choose this finance solution? Let's dig in.

The crux of the matter in ' ABL ' credit is really understanding the differences between other financing options and how it's used in a variety of circumstances. While the majority of companies seeking this method of credit line asset financing do in fact qualify it’s important to understand how the facility is structured.

One of the main good news pieces in ABL revolving credit lines is that they are ' covenant light ' ; business isn't always good news though and some aspects of this type of borrowing includes typically higher borrowing costs as well as the need to provide more ongoing reporting information around ' assets ' .

A good way to define the difference between asset based credit lines and traditional Canadian chartered bank solutions is simply understanding one is very ' asset based' , while the other is very ' cash flow ' based, the latter being of course the bank offering . It's that ongoing focus on borrowing on all your assets under one facility that distinguishes the asset based revolver. Rightly or wrongly the banks our banks don't really look at it that way.

In almost all cases asset backed lenders have a lot more ' asset ' expertise, which one top expert calls ' predictable ' financing. Where banks look at historical, present and future cash flows the asset backed credit lender it’s your A/R, inventory and fixed assets that form the substance of your credit line.

Probably the best example we can provide to clients around why an ABL credit line revolver makes sense is the fact that growing sales places huge pressures on working capital investment, The result? Just when you need credit line financing the most is when bank ratios and operating cash flow ratios limit your company borrowing!

Talk about a double whammy of bad news.







So who uses Asset backed financing solutions? Some of the largest companies in the world actually, its just not generally advertised. For the larger facilities for companies that have good credit ABL solutions pricing is often even better than bank financing, but that certainly doesn't apply to SME Commercial finance borrowers.

So which credit line solution makes sense for your firm, a traditional bank facility or an asset backed ABL revolving credit line? 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 making the right choice.



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 ASSET BASED ABL 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