Does Equipment-Lease Financing Affect My Firms Loan Covenants?

A New Approach To The Asset Finance Challenge For Canadian Business

Information on lease finance in Canada . Equipment loans and leasing strategies play a key role in business financing in Canada . Knowing how this affects your financials and other lending arrangements is key . Here's why

When companies borrow from banks and other asset based lending firms there is, almost always, certain covenants that are put in place to ensure the lenders comfort with the financing. These covenants tend to be financial ratios (we can call them 'number relationships') that would allow a lender to get some sense of early warning that their loan may not be repaid.

The most typical covenants the lenders place on borrowings tend to be:

- Working capital guidelines
- Total debt versus total equity in the company
- Cash flow coverage
- i.e. the company's ability to generate cash to pay the loans

When these covenants are broken discussions ensue with the bank and the company!

Leasing and equipment financing, as a borrowing strategy, 99% of the time we feel, eliminates the additional risk a company takes when borrowing on equipment. That is to say that lease companies, in general, do not insist on those same restrictive covenants that the bank does. We can therefore make a statement that the company has a greater feeling of independence when it enters into a lease financing arrangement.

Why does the lease company not require those restrictive covenants? That is probably for two reasons - the first is the fact that leasing rates are, in general, higher than bank rates, so the lease company reflects their risk in pricing. Many times the lease firm will also ask for a deposit or advance payment to further augment our above point.

And at the core of why the lease company does not insist on restrictive covenants is the fact that most lease firms have very strong asset experience and are generally comfortable with collateral. As we can all imagine, banker can't be expected to have a strong sense of equipment valuation and remarketing - they are of course more 'numbers' oriented - relying on the balance sheet and income statement to predict payment, not the value of the asset.

In summary, leasing as an alternative form of finance allows a firm to acquire equipment without additional concern over lender covenants and ratios more commonly associated with banks.


Stan Prokop - founder of 7 Park Avenue Financial –

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

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


















Article Source: http://EzineArticles.com/3543408

Sale Leaseback Financing In Canada : Saying Yes To The Sale Lease Back Cash Flow Solution

Tweet

Cash Flow Challenge ? Sale-Leaseback Financing ? Yes, You Read That Right !

Information on the sale leaseback business financing solution in Canada . The Lease Back delivers on your company's temporary cash flow needs via refinancing of existing assets

Many business owners and financial managers are often faced with the consideration of utilizing a sale - leaseback to generate cash. This strategy became much more popular over the last year or so as banking and credit liquidity scenarios deteriorated.

The overall strategy can be viewed as giving some operational flexibility to the business. The bottom line of course is that it brings additional cash into the company at a time when ash is king. The customer is of course, essentially 'tapping into equity 'that the firm has built up in the asset. What is that asset?

Typically assets given up for consideration in sale leasebacks are manufacturing equipment, computers, and even a firm's real estate.

Sale-leasebacks have to make sense to both the lessor and the lessee. We view the largest ' negative ' aspect to such a transaction being the potential perception by the lessor, or other lenders that the firm is making a last ditch ' cash grab '. There has to be, as referenced above, an agreement that the transaction works for both parties.

If we analyze a typical example of a transaction we will hopefully get a better sense of why this strategy can in fact be a common sense financing alternative. Company A has manufacturing assets, shown as fixed assets on the balance sheet. In the sale - leaseback scenario the assets of course remain at the company - they do not move. The company receives cash for the sale of the asset to the lease firm. Quite frankly customers who consider this transaction have explored other traditional options by this time, such as reviewing additional financing with their bank or other senior lenders. Naturally the equipment is used on a daily basis to continue to generate sales, (and hopefully profits) for the firm.

In certain instances the sale-leaseback can in fact enhance the customer's balance sheet. One additional major flexibility is that the new sale-leaseback financing can in fact be used to generate additional flexibility at the end of the lease - i.e. the customer can again regain ownership of the asset if it will have economic value, or might choose to negotiate a return of upgrade with the vendor or lessor.

In summary, does a sale-leaseback of assets make sense? The answer as we have seen is ' yes ' if in fact it is done for the right reasons and makes sense for the customer and the lender.


Stan Prokop - founder of 7 Park Avenue Financial –
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

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










Article Source: http://EzineArticles.com/expert/Stan_Prokop/432698

Article Source: http://EzineArticles.com/3556312

Confidential Receivable Financing : Consider Trusting A/R Factoring After This

Tweet







Worlds Almost Oldest Profession Explained – Spoiler Alert – It’s Not What You Think

OVERVIEW – Information on the benefits of confidential receivable financing in Canada. AR Factoring is one of the oldest and proven solutions for business capital in Canada . Here’s why A/R Finance works!

AR Factoring might well rank as one of the oldest professions in Canada. (Probably not the oldest profession you thought we were going to talk about!) How though do such solutions as confidential receivable financing remain such tried and true working capital and cash flow solutions? Let's dig in.

The world of business financing must surely seem more complex than ever in today’s hi-tech world, a world of VC capital, private equity, etc. But even though business owners and financial mgrs can utilize technology to identify capital solutions the rubber hits the road when real capital can be accessed through solutions such as factoring. The ability to generate cash at the same time you make a sale is most welcome to most owners/mgr's and entrepreneurs!

We're told that a/r financing, i.e. ' factoring' goes as far back as 1000 years B.C., but our experience is that owners/mgrs still want the same thing as those early A/R financing practitioners - the ability to sell products and services and obtain cash to keep their business operating cycle rolling. It's that liquidity that keeps business rolling.

Most business owners and their financial managers are often reluctant to take on business debt, and solutions such as confidential A/R finance solve that problem nicely.

The thousands of companies that utilize A/R finance today more often than not ' get it ‘. For other clients that we meet and talk to a certain amount of education is required around costs, benefits, and the many tech solutions that are now delivered through the A/R financing process.
The key benefit around ' Confidential non notification ' AR financing is your firms ability to bill and collect its own receivables while at the same time receiving as much cash as you need or want . You're minding your own business.

Cash flow and working capital financing is all about ' current asset financing ‘, namely the finance of your inventories and receivables. Factoring / AR finance are actually ' subsets' of asset based lending, which can also include turning your fixed assets into a part of your business credit line.

What drives owners/mgrs to consider financing receivables and other current assets? It simply the realization that profits and sales almost never equal ' Cash '! , and the inability of your company to bridge that gap will often determine the true success of your firm and its business financing needs.

Working capital and cash flow solutions include:

Confidential Receivable Finance

Inventory financing

SR&ED Tax credit finance bridge

Asset based non bank lines of credit (combining A/R, inventory and fixed assets into one borrowing facility)

Unsecured cash flow loans

If you're focused on separating myth vs. reality around true current asset financing strategies seek out and speak to a trusted, credible and experienced Canadian business Financing Advisor with a track record of success .

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

Tax Credit Financing In Canada: Refundable Tax Credit SR&ED Loans & SRED Funding Delivers On The Cash Promise

Tweet





Can SR&ED Tax Credit Financing Make Your R&D Journey Happier ?

We Think So And Here's Why

Information on tax credit financing in Canada. SR&ED loans can play a valuable part in refundable tax credit finance . Here's information on why businesses committed to R&D Capital Investment should consider SRED Funding

Not everyone Canadian business owner or financial manager takes advantage of the Canadian Governments SR & ED (Scientific Research & Experimental Development) tax credit program. It's clearly in our opinion of the best and truly legitimate and valuable programs that a government provides for its business entrepreneurs in Canada.

Many, when they hear of the program for the first, are amazed that they can receive significant funds, that are non - repayable (yes that's non -repayable!) for their ongoing investment in research, product development, business processes, etc.

And, those that do take advantage of the program dutifully wait many months, in some cases a year or so or more for their cheques from the provincial and federal government.

Why not borrow against these funds and utilize those funds for much needed working capital and cash flow to further fuel the growth of your firm.

SR & ED financing is still relatively unknown in Canada - it is clearly a very specialized type of financing, somewhat 'boutique' let us say, in nature.

The government, via the program, wants to provide funds to Canadian business so they can continue to further their research and development and provide Canadian firms with a lead in technology and business.

So lets get back to the financing of the SR ED, aka ' SHRED ', aka 'SR &ED'. SR ED Loans are typically for approximately 70% of your combined federal and provincial claim. The claim can be financed as soon as you have formally filed the claim with the government, which is at the same time you do your year end tax filing.

SR ED applications can be filed for the last two years, so on occasion your firm might in fact have a significant receivable generated by virtue of that filing you have done. Our observation is that some companies actually book that receivable in their financial statements for the full amount of the claim. Some companies take the conservative approach and only record the cash coming in when it is received from the government.

So, you as a business owner or financial manager of a Canadian company are asking yourself the obviously - if I book the SR ED as an account receivable, will my bank provide financing for it. Our experience is generally 'no 'they will not. Canadian chartered banks, being somewhat more conservative in nature, recognize the SR ED claim may or may not be approved. So if there is any risk in your financial structure as viewed by the bank they will not advance funds.

The private sector of Canadian finance is in fact doing the SR ED financing. Claims are financed on the basis of your firms overall financial status, although we add that even pre revenue companies or companies that are losing money can still obtain SR ED financing.

Every Canadian firm that files a SR ED claim should consider financing the claim if they feel the additional cash flow and working capital will assist their company in continued growth and success. Talk to an expert and use this alternative financing as a great way to boost cash flow.


Stan Prokop - founder of 7 Park Avenue Financial –
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


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

Film & Sr Ed Tax Credit Financing In Canada : Making Sense Of Tax Credit Loans

Tweet






Exactly What It Means To Finance Tax Credits In Canada :

Good News On Your Film & Sr&ed Credits!

Information on tax credit loans in Canada. Film tax credit financing and SR&ED finance funding can play a key role in your cash flow needs. Here's your why and how !

Film Tax Credit Financing in Canada is a niche alternative financing sector that is growing in popularity. Similar to SR & ED tax credits, film tax credits can be financed.


Various programs are available under different provincial and federal legislation. The Canadian film industry, as well as related Digital and Multimedia industries, seem to be on a healthy rebound which we can attribute to a recovering economy, and a faltering industry in the U.S., again, economically related.


There are a number or very specific programs that can be financed to generate, or recover, funding for your projects. Along with the aforementioned SR &ED program, there is the Ontario Film and Tax Credit, a similar B.C. program, etc.


In many instances our firm can originate financing on an interim basis, in order that your project does not have to wait for funding after completion and final claim finalization and adjudication. Much of the financing that is done in the SR ED, film tax, and Digital and Multimedia areas is a very boutique and specialize financing. However. If you clearly qualify for these programs your claim can be financed. Traditional institutions, such as the Canadian chartered banks do not really play a major role in these types of tax credit financings.


Naturally the benefit of financing such a claim is simply the recovery of funds, almost all of which are ‘ non- repayable ‘ ‘ grants’ that will assist Canadian firms in the completion of their projects and for general working capital purposes . If your firm has significant or major contracts with either the government or a corporate client you require financing to complete the project in a timely and proper manner.


Tax credit financings, in our experience typically take approximately 2-4 weeks to complete. We strong recommend that firms work with a trusted and experienced advisor in this area to ensure they maximize the benefits of such a financing with respect to a solid rate, term and structure based on the unique nature of their claim.


Financing of these programs encourages continued innovation, and more and more funds are available for the film, multimedia, and digital sectors of Canada. Again, we stress the importance of working with qualified parties who can maximize financing benefits and assist you with your working capital needs.


‘Cash flowing’ your project either during or after production has a significant appeal to players in this Canadian industry sector. Naturally there has to be a reasonable investment of time in key areas related to the financing. In order to finance a claim properly entities should be incorporated as a Canadian taxable corporation and should have made the appropriate corporate filings. Naturally your project has to be certified, which can be done through various entities such as Cavco. Financing and documentations is clearly strongly associated with proper and up to date filings and certifications.


Accounting systems and processes typically might not be the forte of firms in the digital, multimedia and SR &ED sector – however it is important that owners and financial managers in t these industries ensure all costs are properly accounted for and documented in their financial statements and tax filings. Filings should be up to date with all federal and provincial bodies with respect to tax returns, and of course your application will be reviewed and audited by the proper authorities.


In summary, Canadian digital, multimedia, film and SR &ED expenses can be financed to maximize your firm or projects working capital. Ensure you are certified and eligible, focus on good accounting and information systems re your claim, and work with a trusted and credible advisor with financing experience in this area. It’s all about the cash flow!


Stan Prokop - founder of 7 Park Avenue Financial –

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

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

3 Business Strategies For a Financing Turnaround & Restructuring

Tweet




Three Strategies To Save Your Company In A Business Financing ' Pickle ' !

Information on business turnaround strategies for challenged firms . Restructuring financing is all about Loans a& Cash Flow Strategies That Make Sense

There are strategies that troubled companies can use to save themselves from dire straits and regain their former financial success. These same sort of strategies are valuable for business owners and financial executives to understand how their firms can avoid financial turbulence and failure.

We must first realize that business failure or bankruptcy never happens overnight. Normally there is a gradual trend of financial deterioration that is sometimes exacerbated by industry troubles. In the 2009-2010 environment the auto industry is a poster child for a troubled industry, as an example.

Naturally firms that are on the very precipice of failure or bankruptcy do not have many options or time left. It has to fix itself, or sink. No business owners or entrepreneurs want to face bankruptcy, liquidation, and other creditor issues.

Do financially failing firms survive because of a revival in products or their services, or have they in fact executed on improved financial management. This is a challenging questions, because the very financial problems that beset a firm hinder it in getting new sales, acquiring inventory, and regaining supplier credibility.

Also, lets be realistic, banks and other finance companies do not throw themselves at failing firms with financial offers of loans, lines of credit, etc. In fact what usually happens is that the company is forced to pledge some or all assets at much higher rates, sometimes simply accentuating the financial problems that were already there.

So what are the financial strategies that a firm can undertake to avoid financial failure when it has been losing sales, not generating profits, and generally traveling down a potential death spiral?
There are three or four solid strategies that can save the firm. The first is ' assets '. The second is liabilities and debt, and the third we will simply call ' maneuverering '.

Strategy 1:

Assets have value. They can be sold, re financed,, or pledged to secure new financing. This type of strategy works best when it works for all parties, the company and the lender, or the company and another firm. However lets be clear that this is somewhat of a one shot strategy. It either must work or it doesn't. Asset maneuvers have 3 stages of success: assets can be used to get a new loan, assets can be sold, or they can, in somewhat of a worst case scenario, be liquidated.

Strategy 2:

On the other side of assets on the balance sheet is debt and equity. Debt can be structured properly to ensure the lender gets a reasonable reward, and the company is able to both repay and survive. There are too many types of debt to consider for the purposes of this article - suffice to say that creativity in debt is somewhat unlimited. A firm could issue debt, as an example, and repay only when the company is earning profits again.This would normally entail higher rates, but again, as we have stated, the transaction has to make sense both for customer and lender. A solid alternative solution is to simply re - structure existing debt at new rates and amortizations.
Alternatively to debt a company with promise can bring in new equity or ownership. This is somewhat more risk for all as dilution of ownership is usually significant when a company is failing and bring in new equity capital.

Strategy 3:

A firm sometimes has to look to the outside for help. Since the owners and managers are often too close to the problem it is somewhat of a classic case of not seeing the forest for the trees. Outside consultants and industry experts can often bring a solution to the table. They have insights that management simply did not possess. These strategies include developing new sales and product strategies, bring in new management, or considering a strategic merger.

In summary, anyone who has worked through several business cycles over a number of years knows that companies can in fact be saved. Some go on to be the new super stars of their respective industry. The company must clearly uncover what the problem is, and then adapt strategies, financial or otherwise, to fix those problems. 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 funding & capital needs.



Stan Prokop - founder of 7 Park Avenue Financial –

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

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

Working Capital Financing In Canada : Business Loans & Cash Flow Finance Solutions

Tweet



No, Wait , You Just Might Not Understand All Your Canadian Business Financing Alternatives !

Information on working capital financing in Canada. Factoring and other types of alternative business loans can provide valuable cash flow finance solutions for the funding challenges of Canadian businesses

Working Capital Financing - Canada continues to be challenged by liquidity and financing for business.  For Canadian business owners to be successful they need to have new financing alternatives today. I recently spoke to a business owner who was quite clear on his thoughts on the new financing alternative for business - factoring, also known as receivable discounting. Let’s examine his problems with this unique financing alternative and see how valid his points might be.


According to my customer – ‘Ten Reasons Not to Factor:’
 and our answers to those issues! -->


COST - Many business owners perceive factoring to be very expensive - yes it is more expensive than traditional financing , but it provides you with all the liquidity you need when you cant get receivables financed or margined by a Canadian chartered bank - a proper effective analysis by an experienced business advisor can show you that you can recoup almost all of the costs of factoring in a number of ways - also, many business owners and financial managers don’t understand the true cost of carrying their receivables for  60-90 days and what the financial benefits are of turning receivables over quickly


DON'T UNDERSTAND THE MARKETPLACE-


There are many types of factoring - notification, non notification, recourse, non recourse, spot, etc - Yes , if you don’t understand the marketplace talk to a financing expert - he or she can explain what factoring solution works for your firm


TIME TO APPROVE THE FACILITY - In reality factoring and receivable facilities can be set up in days, not the weeks and months it might take to negotiate a significant bank line


HAVE FINANCING NOW - Factoring can be complimentary to your existing financing when all parties work together, which creates a win win environment


WEAK BALANCE SHEET- If you have a weak balance sheet that does absolutely not preclude you from a factoring or invoice discounting facility
LOSING MONEY - Factoring and receivable financing focuses on assets, not financial losses - Hopefully the financing facility will in fact put your firm back on the road to profits and working capital


I  HATE NOTIFICATION - Our firm specializes in a unique form of non notification factoring financing - you bill and collect your own receivables - Check out CONFIDENTIAL RECEIVABLE FINANCING

I AM WORRIED ABOUT BAD DEBT - Depending on the factoring expert you are working with facilities can be structured to insure your receivables


OTHER FIRMS THINK I AM IN TROUBLE IF I FACTOR - that is an old way of thinking when factoring originated in Canada - the reality is that some of the largest and most successful corporations in Canada factor tens of millions of dollars of receivables


DON'T KNOW WHO TO TALK TO -  Factoring is a newer form of alternative financing, talk to people you trust or engage the services of an experience factoring advisor who will take the time to explain your options and set up the facility
Hopefully my customer now understands that factoring as a working capital option is something that every business should consider as a financing alternative .


Stan Prokop - founder of 7 Park Avenue Financial –
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

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