Financing A Business In Canada : Solving Working Capital & Funding Needs

Time For Some Self Driving Financing ? Here’s How To Finance Your Funding Needs

OVERVIEW – Information on financing a business in Canada. Knowing your working capital & funding solutions & costs enhance business probability for success

Financing a business always seems to come back to that tried and true (cliché?) term of cash flow being the lifeblood of a business. No matter how overused the term might be most business owners and financial mgrs would not dispute the need for the right amount, and type of business funding. Let's dig in.


The downside of not having, or being able to arrange cash flow and working capital financing is simply that you have a lesser ability to grow sales, maximize profits and take advantage of new opportunities .

So what in fact are the working capital and financing issues that are raised on an ongoing basis for your business?

Key is understanding how your receivables, inventory, and other assets come together to drive working capital and cash flow. And, to our point, how do you finance those assets and those needs?

What are the real drivers in funding need - typically it's growing revenues, expanding, and in some cases buying or merging with another business.

Although most business owners/financial mgrs can't imagine having too much capital for their business that over abundance would actually mean you are not using capital properly! The bottom line, as experienced by most business folks, is that financing a business is actually a balance act.


One of the main things you should focus on is your ability to pay your current debt - On the balance sheet your accountant shows that as ' current portion of long term debt ' - You always want to be in a position to meet these obligations as failure to do that means you are bordering on insolvency . All of that snowballs into major issues with your bank, your suppliers, and other creditors such as leasing or finance firms.


So as we have said, you need to be able to calculate, or measure working capital, and then address how you will satisfy the need that comes out of those numbers. There are some easy calculations you can perform in measuring your overall cash flow - it's really simply understanding your inventory and A/R turns, as well as having a handle on your accounts payable days outstanding.

If it was a perfect world you could raise all the working capital you need internally. How would that work?! Well, using an extreme example if you collected your receivables in 45 days, and turned your inventory in 45 days, and were able to pay your payables every 90 days you would be very self financing. Sounds great, except you can hear your suppliers and creditors now I bet... Also, the profits that you generate out of your business obviously become a new additional part of the working capital component and would even further benefit your overall position.


But let's get back to the real world, which states that if you have more current assets than current liabilities you 99% of the time need external working capital.

Canadian business owners achieve that additional working capital in a number of ways - the most beneficial is bank lines of credit, or in some cases, if your firm meets the criteria, a cash flow working capital loan. If you are unable to meet bank criteria, and are still in a challenged or growing position then we advise clients to consider a non bank working capital or asset based lending facility.

If receivables tend to be your main current asset than a factoring or invoice discounting facility makes the most sense. Most Canadian business owners don't fully understand how factoring in Canada works, and are often confused by the costs and process.

So what’s our bottom line recap - it’s simple -

Understand how much financing you need - that means ' measuring' your needs, as well as what type of funding suits that need.


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 13 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

Accounts Receivable Financing In Canada : Inside The Factoring Cash Flow Solution

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Business Cash Flow Pain ? Here’s Some Solutions

OVERVIEW – Information on accounts receivable financing in Canada. Factoring and other cash flow solutions can enhance your chances of business success when traditional financing is not unlimited!

Accounts receivable financing just might be one of the fastest growing ways to generate cash flow and working capital for your business. Thousands of firms in Canada utilize this strategy as a primary method of funding their business. Why? Simply because when traditional bank financing can't or won't get you there cash flow factoring solutions deliver. Here's why and how - so let's dig in.

Let’s examine why this business financing strategy works and how you can best assess if a factoring receivable solution is the best choice for your firm.

We also point out to clients that the Canadian landscape for this type of financing is somewhat different from the U.S. models of this type of financing, and one of the most important decisions you can make after choosing to enter into such a strategy is simply picking the best partner for your particular needs .

Almost every business study or report you read this days has business owners and financial mgr's bemoaning the lack of business financing and funding for their business .


Business prospects have clearly improved, but business access to capital has been very slow to catch up. Most Canadian business owners and financial managers turn to those banks when they need financing; However if your firm doesn’t have very decent financials, or isn't generating profits and operating cash flow your chances of getting the funding you need to run and grow the business is low .


So we come full circle to how does factoring work and why are it a potential solution for your firm. It works in a very simply manner - you sell you invoices, either one at a time, all at once, or regular periodically at your choice . The key word is selling. When you sell something you get cash, and factoring receivables is your method of obtaining immediate cash.

The complexity of factoring, if we can call it that, is simply how it works on a day to day basis within your own business model, and more importantly, how it affects your customer base. Using traditional factoring as our explanation your firm issues an invoice, you are advanced immediately approx. 90% of the funds, i.e. almost the same day!, and when your customer pays you get the rest of our funds immediately, less a financing charge .

That aforementioned financing charge becomes the most important point of focus for many of our clients given that factoring rates in Canada on a monthly basis range from 1-3% per month.

When clients address that issue of cost we point out to them that if they have solid gross margins, can turn over receivables, and have the ability to purchase more effectively with the new cash that the cost of factoring inevitably becomes somewhat of a non event, based on the fact that this facility provides you ‘unlimited’ working capital on a long term basis.

KEY POINT - We strongly recommend Confidential Receivable Financing/Factoring for firms that want to bill and collect their own receivables and manage their cash flow needs.

In Canada the challenge becomes finding the firm that works best for you with respect to the receivable strategy we have outlined. Many of the small nuances around how factoring is marketed, explained, and works on a daily basis becomes the bone of contention for our customers.

Other short term cash flow and working capital solutions are also available inside the world of asset based financing, where ' factoring' resides. These include:

Merchant advances for retailers

SR&ED Tax Credit Loans

Non bank asset based credit lines which combine borrowing power around your total A/R, inventory and equipment


Seek out a trusted, credible, and experienced business financing advisor who can guide you through the factoring maze relative to price, size of facility, and most importantly, how the facility works on a daily basis to augment your cash flow and working capital.

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 13 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

SR ED Financing Via Sred Loans : A SR&ED Tax Credit Loan Monetization Strategy That Works

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Is Your Company Taking Advantage Of SR&ED Loan Financing? Consider This ..

OVERVIEW – Information on SRED loans in Canada. SR ED financing via a tax credit loan is the logical way to monetize your r&d capital credits for cash flow purposes

SR ED financing is the most efficient way to accelerate and monetize your investment in R&D capital. A SR&ED tax credit loan allows you to take maximum advantage of this most famous and used govt refundable tax credit. Why do SRED loans make sense for your firm then? Let's dig in.

Of course the actual ' formal ' name for the program is the Scientific Research & Experimental Development refundable tax credit .By the way , we've never been one for name calling , so whether you call it ' sred ' ' shred' or anything else for that matter only the importance of the program is key to us!

Canadian business owners and financial managers in a variety of industries have the ability to of course file sred claims, and at the same time, if they choose, they can finance their claim and generate immediate cash flow and working capital from this valuable government grant program. Again, to be clear, those funds are non repayable.

Safe to say that the only thing that prevents you from financing a claim is if you do not file a claim, so understanding the basics around a claim, as well as the characteristics that claim needs to be financed is valuable information for Canadian business owners and financial managers. The govt refunds billions of dollars every year under this program , and many owners/mgr choose to finance their claims.

Claims are filed and substantiated under the normal program guidelines. One of the misconceptions around the program is that your R&D has to be successful in nature, and that's actually NOT correct, you just have to be in a position to document what you did and how you did or tried it.

Although claims prepared by owners and management can be considered for financing, the reality is that if you are applying for sr&ed financing it makes a lot more sense to have your claim prepared by one of two parties, either your accountant , or what is known as a ' Sred Consultant '.

Claims have never been easier to file, as the govt has very much streamlined the program - but total care is needed to adhere to current filing guidelines - that's where those SRED consultants come in.

With the information we are sharing here we want to be able to ensure you understand how the quality and size of your claim affect its overall financeability. SRED claims are applied for in all sorts of amounts, we have seen clients file as low as 20,000 - 30,000$ per annum, and as high as 1.5 million dollars, and we are sure there have been higher claims.

The actual claim preparation has an effect on your claims financeability - as your goal, should you need the cash flow and working capital, is to monetize that claim into a short term sred loan - with the sred itself being the collateral for the loan.

When you choose to finance a claim the general advance is made at 70% - so let's do some rough arithmetic around a sample claim and it's financing.

We're told that in business timing is everything - As a business owner you can wait anywhere from 1-12 months to get your cheque in from the government, which is reimbursed at the federal and provincial levels. Or, if you choose to utilize those funds now under a sred loan, you can get an immediate loan of 70% of that claim.

What do clients do with their SRED Loan proceeds? Funds are typically used for working capital purposes, equipment purchases, or even more ongoing sred activity! Looking for more good news? No payments are made on your sred loan; financing costs are calculated at the back end of the claim when you receive your funds, including the previously mentioned 30% that was held back on the financing.

Furthermore, if you have successfully financed sred claims in the past you could be very eligible for sred accrual financing - which is a special program that reimburses you for your sred expenses as you go along during the year.

Traditional financing institutions such as banks and business credit unions are poorly equipped to understand and finance sred tax credits .As a result we recommend you work with a trusted and credible business financing advisor to ensure your claim can be financed quickly and with a modest amount of preparation.

A bottom line on SRED Loans? If you in fact utilize the SR&ED program consider cash flowing your claim to accelerate the monetization of your claim. Seek out and speak to a trusted, credible and experienced Canadian business financing advisor who can assist you in financing your R&D capital refund.


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 13 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

Business Financing Sources In Canada : Perils Of Not Understanding Cost Of Loans & Available Cash Flow Solutions

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Everything You Should Know About Business Financing Sources & Costs In Canada

OVERVIEW – Information on business financing sources in Canada. Loans and other cash flow monetization strategies can make or break your business success

Business financing sources in Canada come with a variety of solutions and different costs associated with these loans and cash flow monetization strategies. Is it important to understand these costs and alternatives? We think so! Let's dig in.

Typically (in a perfect world - and we know it's not) business owners & financing mgrs want to know that can access cash and loans on an ongoing basis. It's critical to know, and understand the costs and benefits associated with those different types of financing.

Working capital needs are often the main driver in the search for supplemental financing - When you understand what working capital is you are obviously in better position to source it!

You therefore need to know how to measure working capital in terms of your overall business needs. That’s part of the problem and challenge, because when we sit down and work with clients on working capital and cash flow needs we quickly determine that working capital and cash flow mean different things to different business owners .

The problem usually starts with the business owner assessing his working capital needs by looking at the cash available in the company bank account. That amount doesn’t of course reflect the ' near cash ' that is tied up in receivables, inventory, prepaid, etc.

We can go to the text book definition also ( not our favorite way of doing things ) and finding out that working capital is simply current assets minus current liabilities, calculated by a quick look at your balance sheet . We are not a big fan of that calculation, simply because it doesn’t give you a true sense of the turnover of those critical balance sheet accounts such as A/R and inventory. Cash flow is all about asset turnover!

By the way , don't assume bigger is better in your total working capital amount - in fact the more funds you have tied up in A/R and inventories will simply place a larger stress on your cash flow needs . That's where constant asset turnover helps - turning inventories and collecting receivables. You should regularly, at least monthly be calculation your days sales outstanding and inventory turns.


By the way, even effective payables mgmt will increase cash flow - much to the chagrin of your suppliers! Don't over manage and ruin vendor relationships which are key to a successful business. Deterioration in supplier / creditor relations is one of the worst things that can happen to your business.

So now you have a better handle on working capital, what next? Well you clearly recognize that cash on hand and growing inventory and A/R isn’t helping your cash flow at all - you need external financing. You achieve external financing by the profits you generate from your business, plus working capital facilities via a bank or independent finance company. Your needs might be seasonal, or ongoing, depending on what industry you are in.



Other more traditional alternatives are bank operating lines of credit, these come with the best rates, current in the 4-5% range in early 2010 in Canada. The only problem? Great rates but difficult financing to achieve as Canadian chartered banks demand solid financials when they are granting this type of facility. A better way to achieve full liquidity via this method is to consider a factoring or asset based facility.

Rates in Canada range for 9% / annum to 1-2% per month based on your overall financial position and size of facility. But, they offer you 100% working capital for all your business financing needs, so that’s a good trade off. 99% of the time you will have increased your available credit availability by 100% as your receivables are margined at 90% and inventory financing is also a key part of a non bank business credit line.

So back to our sources of financing and the costs associated with those sources. You of course have the option of either generating a working capital term loan, or, if it’s a larger facility, it might be called a Sub debt or mezzanine loan. Essentially they are unsecured cash flow loans with rates in Canada ranging from 10-15% - they are traditionally on a fixed term, fixed rate basis - 5 years is common.

You also have the option of putting more permanent equity into your business via an equity injection of bringing in a new shareholder. We are perfectly clear with clients that this is the most expensive form of financing, because you are giving up future ownership.

Other miscellaneous sources of business financing come with various costs but significant upside to your funding chances. These include:

Sale leasebacks

A/R Factoring / Confidential receivable financing

Bridge loans

SR&ED Tax credit loans

Merchant advances for retailers

Equipment financing for new and used assets

Understand what sources of financing are available to your firm, knowing their costs, and executing on facilities or solutions that make sense for your business is the true working capital and cash flow solution for Canadian business. Speak to a trusted, credible, and experienced business financing advisor to guide you to the right business financing decision.


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 13 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

Asset Based Lending Might Be The Ultimate Cash Flow Financing Solution – Why Asset Finance Strategies Work

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Business Success Is Hard –

Business Financing Success Is Even Harder – Here’s A Solution

OVERVIEW – Information on asset based lending in Canada. The right cash flow solutions for your firm might just come from these asset finance strategies

Asset based lending in Canada often brings one simple question from our clients - namely: Can you explain asset finance cash flow solutions to us ?Businesses all over Canada in every industry keep hearing about nontraditional lending solutions for their businesses - in many cases their competitors are already taking advantage of them . They want to know more... so... let's dig in.


So is business financing via asset finance a difficult concept to understand? Hardly. Asset based financing, often called 'ABL' by those in the industry, is simply the method of obtaining the maximum working capital you need from your assets, which include typically receivables, inventory, and in many cases some equipment and/or real estate. That's as simple as it gets.


So how can monetizing your assets be the potentially ultimate working capital tool for your business?
Although it's been in existence for many years, in the past asset finance or asset based lending (we also call it a 'working capital facility ") is coming into vogue.

It doesn't take rocket science to understand when, given traditional financing almost totally collapsed in the 2008-2009 global meltdown, that companies began searching for options and alternatives to their business financing needs.

Lenders like asset based financing simply because they are using their expertise and knowledge in your assets to help you cash flow your business.

Although many companies turn to asset based lending when they can’t access traditional bank financing the reality is that this type of financing has some unique characteristics that allow you to utilize the financing for other reasons - Those include:

Major expansions

Buying another business

Bridge financing your business while you undergo a restructuring or turnaround.

In many cases it's ' buffer' financing allowing you to get back to more traditional ' bank type ' financing.

As we stated, it's very simple for us to explain to clients what an ABL facility is, it's a bit more complicated to get them to understand how it works. The best way to explain it though is to simplify it all and say that you should consider asset finance via a working capital facility as simply a ' revolving line of credit around all your business assets '. Can that be anymore simply to understand? We don't think so.


Typically the process is as follows - After the traditional ' application ' process there is an agreed upon value put on all your business assets - as we said , 99% of the time the assets under this financing include receivables, inventory, equipment, and in some cases real estate . The most common assets though are receivables and inventory.


Your firm provides regular monthly, and in some cases weekly updates on the values of these assets, and you in turn use your regular bank account to draw down on funds, as you need them, to run your business. Similar to a bank revolving line of credit facility your asset based financing facility fluctuates everyday as a dollar of capital flows through your business - you purchase product, you generate a receivable, you collect your receivable, and of course the process repeats itself.

If there is one simple advantage of asset based lending it's that the financing grows as you grow sales and assets! You can truly say you have access to unlimited financing, albeit often at a higher cost.

Other forms of asset based lending such as SR&ED Tax Credit Financing, Leasing, factoring receivables, and PO Finance are being routinely used by many of your competitors. Why not your firm?

Asset Finance strategies help you do that. 50% of Canadian businesses report that the inability of their sales growth to generate funds hinders their progress. Top experts such as Canada's BDC cite growing a business as the most common goal of the vast majority of firms.

Speak to a trusted, credible business financing advisor in this area to ensure you understand the options, and of course the benefits, of this unique and creative method of business financing.


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 13 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

Sources Of Financing In Canada : Sorting Out Working Capital & Cash Flow Finance Options

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Get Hard Wired On Your Best Solutions For Canadian Business Financing Needs

OVERVIEW – Information on sources of financing for Canadian businesses with SME COMMERCIAL FINANCE needs. Getting the most out of working capital and cash flow solutions requires this information

Sources of financing requires business owners & financial mgrs in Canada to get ' hard wired' into real world accessible financing for solutions to their working capital and cash flow challenges. Let's dig in.

Funding for your business typically revolves around growing your sales and staying a step ahead of the competition. Businesses in the SME sector in Canada (small to medium enterprises) represent the largest majority of business in Canada.

Those firms that have been in business awhile, are growing their sales, and have the ability to sell products in other geographies are always strong candidates for new financing.


Tapping into sources of financing must for most business owners and financial managers in Canada seem like finding the holy grail of financing - We're far past the 2008 recession but most businesses still find finance options inaccessible.

Most business folks associate Canadian banks as the sole source of business financing .When we meet with clients who have been denied bank loans we can of course commiserate. Is there a solution?

The bottom line quite frankly is that Canadian business is looking to alternative sources of financing for working capital, cash flow, and asset acquisition. The Canadian government has a full scale bank that is a non bricks and mortar bank, i.e. not branches, and they are committed to providing working capital and equipment financing.

However, the bottom line reality is that if you can access the business financing you need you should consider non bank financing, because it is these firms that seem to be the current bench strength in asset and receivable financing - these firms include:

Leasing companies - (Note that top experts tell us that machinery & equipment are almost always at the top of the list in new financing needs) Right behind that is investments in computers, software and other technologies

Asset based lenders - equipment, receivables and inventory

Purchase Order and Inventory financing firms

Factoring firms - i.e. receivables

Tax credit monetization firms - i.e. sred/Sr&Ed credit financing

When we talk to clients they often use the term 'government grants and loans '- We feel that term is not realistic, in that that the only two real world programs out there are the Canadian SR&ED program, which is the non repayable grant for r&d, and also, the government Small Business Loan .
Working capital financing in our terms means several very clear solutions:

Monetizing your current assets such as receivables and inventory

Cash flowing items such as Sr&Ed credits

Entering into a government working capital term loan

Negotiating a working capital/receivables financing facility - which in larger dollar terms is referred to as an asset based lending (ABL) arrangement. These facilities provide a significant amount of business credit line on terms far more attainable than traditional bank type financing. Asset based lending is leading the charge in the revolution in Canadian business financing.

When looking for sources of financing for working capital and cash flow is sure you understand the meaning behind the jargon. Determine whether you are looking for liquid operating capital, or a longer term working capital solution.

A recent BDC study concluded that 1/3 of all businesses in Canada have difficulty in accessing financing to run and grow their business. Is that you?

Seek out and speak to a trusted, credible, and experienced financing advisor who can guide you through the Canadian working capital maze and determine what the best cash flow and source of financing is for your long term growth and profits.


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 13 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