Don’t Gamble On Franchise Funding Success . Finance Your Franchising Opportunity Properly!

Tweet

Franchise Funding in Canada - Financing Your Franchise Purchase

Franchise funding in Canada . At times does it seem like you have to take a real gamble on the franchising opportunity just to complete a transaction properly? And then finance it? Is there a better way? We think there is, and here's why, and how!

We're the first to admit making that franchise purchase decision is a huge leap of faith for many existing and would be entrepreneurs. Not only is it appropriate and important to align yourself with the proper franchisor, the challenge then becomes assembling what we could call a small ' team ' of advisors and mentors. So who is on that team - typically it’s a key contact at your franchisor, your accountant or franchise lawyer, and a financing advisor of some type - it might be your banker, it might not be.

So if you have a team in place is there still a gamble and risk here? To some degree yes, as the question still hangs over your opportunity, namely ‘How does franchise financing work and can I convince a lender of some sorts to approve my transaction?”

If there is any good news in the cloud of doubt we seem to be casting (we’re not trying to be negative!) here it’s simply that a franchising opportunity is viewed as a positive business model in today’s Canadian lending landscape.

Getting the right terms and conditions and utilizing the best finance program for franchises is key. So what then makes franchise funding and getting your acquisition in place a ' gamble ' sometimes? One thing is the quality of your team - the advice and direction you get from your franchisor, your finance partner, your specialized franchising lawyer etc are worth a million dollars... or close to it!

When it comes to financing you absolutely must be working with a lender of financing advisor who is both positive, and yes, experienced! in franchise finance. The reality is that there are always naysayers in any crowd, so if you get the old line ' we like you and your idea but we just think it's too risky ' you are absolutely going to have to replace some of our aforementioned team mates!

Who are the preferred lenders in franchise funding in Canada. You might be surprised to know it’s the federal government! Under the auspices of the CSBF program thousands of franchises are financed in Canada every year. Is it an automatic approval? Hardly - but you can eliminate a lot of the gamble we have been talking about by simply focusing on a crisp presentation.

That includes a solid business plan , cash flow, ( Cash repays loans by the way !) and the ability to position yourself as having an appropriate level of business or industry experience within the sector you are entering into with your franchisor .

While we identified your franchisor as part of your team we would quickly hasten to say that you’re really gambling on success if you are relying on the franchisor to help you with financing in a direct manner. 99.999% of the time they don't and won't.

That is why the CSBF program we mentioned is so popular. It’s a largely guaranteed government loan that still gives you tremendous financing flexibility. Other sources of financing include specialized franchise lenders and commercial finance and leasing firms who can assist in closing your transaction successfully.

Speak to a trusted, credible and experienced Canadian business financing advisor who can assist you in removing the ' gambling ' aspect of successful franchise funding in Canada.






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

Direct Line = 416 319 5769

Email = sprokop@7parkavenuefinancial.com

http://www.7parkavenuefinancial.com


Business financing for Canadian Firms , specializing in working capital, cash flow, asset based financing , Equipment Leasing , franchise finance and Cdn. Tax Credit Finance . Founded 2004 - Completed in excess of 100 Million $ of financing for Canadian corporations .

' 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

Does Your Canadian Company Have A Serious Asset Finance Loan Or Leasing Strategy ? You Need One!

Tweet

An Asset Finance Leasing and Loan Strategy ? Most Canadian business owners and financial managers realize they can either purchase fixed assets out of equity, or finance those same assets on a long term lease.

Business owners need to focus heavily on the use of the asset. Any company that acquires assets has either a long term view of the asset or a short term view. Lease financing is an excellent method of financing long term assets.
From the company perspective a long term lease on the asset - typically 3-5 years, and sometimes longer, is simply a method of purchasing the equipment via a ' loan '. The company simply decides on which asset or assets they wish to acquire, and then negotiates a price with the vendor or manufacturer. Typically the company is either dealing with the vendor/mfr. or the captive finance firm related to that manufacturer.


Business owners are barraged with claims that ' leasing provides 100% financing ' or that it ' conserves capital '. More sophisticated business owners and financial executives know that long term leasing is in fact a solid mechanism for tax avoidance. Some people maintain that if corporate taxes disappeared long term leasing would disappear!


When a firm arranges leasing it of course uses the equipment, and makes fixed payments on that equipment. Business owners focus more often than not on ' using equipment ', not owning equipment. The user can though structure leases allowing them to purchase the equipment at end of term.


If a customer does not wish to acquire assets over a long length of time, and if those assets have a shorter useful economic life than a firm should consider an ' operating lease '. The company has the right to cancel the lease at the end of term, return the asset, etc. In long term asset financing the transaction cannot be cancelled.
If a firm utilized a purchase strategy for long term assets then the funds for those purchases come from equity shareholders. The company uses the asset, and it owns the asset. Many customers have a philosophy of ' pride of ownership ' and have long term histories of acquiring assets under a purchase strategy. If the company is properly funded this is of course an entirely viable option.


We would point out further that if the financial markets were ' perfect ' ( they are not!) the advantages of leasing would diminish. In that case the company would not have to consider legal costs, brokerage costs, and other miscellaneous fees. Leasing matters because there are no perfect markets - advantages gained by the lessee are at the expense of the lessor, and each company has a unique credit and risk profile.


In summary, each company has a unique financial structure and acquisition philosophy around financing and asset acquisition. Owners and managers must consider the optimal financing strategy for long term assets that best suits overall corporate needs.
Speak to a trusted, credible and experienced Canadian business financing advisor on your asset finance and lease strategy .







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

Direct Line = 416 319 5769

Email = sprokop@7parkavenuefinancial.com

http://www.7parkavenuefinancial.com


Business financing for Canadian Firms , specializing in working capital, cash flow, asset based financing , Equipment Leasing , franchise finance and Cdn. Tax Credit Finance . Founded 2004 - Completed in excess of 100 Million $ of financing for Canadian corporations .

' 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

Canadian Commercial Business Bank Financing - What’s Right ( And Wrong ) With Your Banking Strategy

Tweet

INFORMATION ON BUSINESS BANKING SOLUTIONS IN CANADA

Canadian business owners and financial managers assess their commercial business banking and financing needs at different times in their company's life.

As in many other facets of business it's a little difficult to develop a solution and fix a problem if you don't understand the fundamental problem.

The need to grow your business and be profitable usually drives a bank financing need. A growing business consumes, and needs more cash, if only for the fact that you’re building up receivables and inventories.

In Canada business operating lines of credit are offered by our chartered banks. These facilities finance your A/R and inventory via specific margin calculations.

Most Canadian firms that have this type of credit facility submit monthly financials and aged receivables, which in turn create a new borrowing base under which you can draw funds. Companies that are having challenges ( i.e. they are in special loans ) or who are in breach of covenants may in fact be required to submit almost daily cash flow and receivable reports .

Although the basic arithmetic around bank financing and commercial banking is simple in reality there are a lot of other factors that might end up affecting your bank facility.

What are some of these? In the continuum of time certain industries fall in and out of favor. No better example of this is offered up than the auto industry. Other factors that you as a business owner might not like that affect your bank financing are issues such as your profits ( or lack thereof!) , they quality of business and outside collateral, and your banks insistence on personal guarantees.

Bank financing works best under the following condition - your company is expanding, but at a reasonable rate. One of the greatest ironies of Canadian business financing is that a hyper growth business, even if its generating profits, is often viewed as financing challenged by a Chartered bank.

Business banking utilizes a very basic concept that is often misunderstood by the Canadian business owner. That's simply the fact that with a commercial bank line of credit you're drawing on assets of your growing business to pay older items. But wow, when your business ceases to grow, or profit your ability to draw cash flow out of your A/R and inventory business line of credit stops. But you still have operating and fixed term payment obligations and it now becomes difficult to pay suppliers.

Companies that have a solid handle on cash flow needs and their historical working capital inflows and outflows are in the best position to manage their firms and access bank financing.

Time and time again we meet with clients that tell a very similar story - business grew, expansion plans were put in place, fixed and operating costs grew, and .. you guessed it .. sales started flattening or going down. The result - a recipe for financial disaster!

The ability to manage your cash flow, or, alternatively, slow down your business is key. Speak to a trusted, credible and experienced Canadian business financing advisor for commercial bank financing that makes sense from where your firm is now.






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

Direct Line = 416 319 5769

Email = sprokop@7parkavenuefinancial.com

http://www.7parkavenuefinancial.com


Business financing for Canadian Firms , specializing in working capital, cash flow, asset based financing , Equipment Leasing , franchise finance and Cdn. Tax Credit Finance . Founded 2004 - Completed in excess of 100 Million $ of financing for Canadian corporations .

' 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

Do Your Competitors Use A Customer Finance Vendor Program To Beat You At The Sales Game?

Tweet

Thinking about a customer finance vendor program ? We know for sure that many Canadian business owners and financial managers recognize that their competition sometimes wins the sales battle, without even beating you at actual pricing / cost.
How do they do that? If you had the ability to get to the bottom of the matter you just might find that your lost client was offered a financing solution by your competitor for a sale you should have made!


Thousands of firms in Canada increase sales and are able to motivate their clients to purchase by the effective use of a vendor finance program.
Can we think of two reasons why you wouldn’t want to do that directly? We sure can - first of all you probably don’t have access to unlimited cash, and secondly, there are some serious revenue recognition programs when financing is offered by the seller.


So if that’s the case, what’s the solution? There's a great one, and it’s simply to set up an effective customer finance program that allows you to control the sale and program in partnership with a firm that will provide you with the capital and tools to offer such a benefit to clients.
It's important though to understand the benefits, and in some cases the limitations of the program. Simply speaking, you need to know how and why to offer a financial solution for your client. To coin a phrase we came across over 30 years ago from a trusted mentor, you want to be in a position to ' Remove the Obstacle to Innovation ' when a client considers your product and service combo.


In many cases you want to be in a position to close the sale more quickly - in effect shortening your sales cycle. The financial solution offered to your customer keeps interest in your offering high, and at the same time allows you to get one step up on a competitor who isn’t in fact able to offer the financing.


When you partner with the right firm or individual to offer such a program its essentially at no cost to yourself, other than your time commitment in promoting and putting together the program.


And by the way, you or your sales for don't have to be ' financial pros’ - your partner firm or individual is fully prepared to step in an consult with your customer on the basic elements of such an offering; they of course are things such as term of lease required, monthly payment, possible ownership at end of term, credit approval, etc.


By investing some time in such a program you can have different... let us call them ' flavors' within your offering. They might include shorter term rentals, the proverbial ' don't pay a cent event ', below market interest rates that could be subsidized by your firm in order to increase sales, or allowing customers to pick and choose their own monthly payments by providing them with a rate chart - with of course your firms name at the top . In effect your customer finance vendor program has allowed you to be a total solution vendor.


Speak to a Canadian business financing advisor to find out how you can beat your competitors through the use of a financial option.







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

Direct Line = 416 319 5769

Email = sprokop@7parkavenuefinancial.com

http://www.7parkavenuefinancial.com


Business financing for Canadian Firms , specializing in working capital, cash flow, asset based financing , Equipment Leasing , franchise finance and Cdn. Tax Credit Finance . Founded 2004 - Completed in excess of 100 Million $ of financing for Canadian corporations .

' 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

Considered A Canadian Business Advisor For Specialized Access To Financing Funds And Lenders In Canada?

Tweet

Information on Business Financing Advisory Services In Canada

Yes, of course it’s ultimately up to you but have you considered a
Canadian business financing advisor for your specialized access to funds, financing and traditional and alternative lenders in Canada?

As we said it’s you the Canadian business owner or financial manager that has to both recognize the need for and make the call when it comes to your company financial needs. Whether your firm is in some type of financial distress, or if you have the double edged sword challenge of growing sales (how do you finance them).

The fundamental concept of business finance ( and unfortunately many don’t know or recognize this ) is that as you grow your sales you must invest more in business assets such as inventory, receivables, and even equipment under your fixed assets category on your balance sheet.


In a perfect world (guess what, it's not) you want to be able to be in a position to generate and have access to financing almost ' spontaneously ', as you grow. And we forgot to mention that that higher investment in A/R, inventory, etc also leads to higher obligations when it comes to payables from suppliers, wages, and government super priority payments such as HST, employee source deductions, etc.

Yes, actual profits (when collected, by the way!) provide additional financing for your firm, but ultimately you will need access to lenders and financing sources to compliment your business finance needs.


When you consider assistance outside of your firm, such as a business advisor it might even be at a time when serious challenges have set in. Those challenges may be diverse, such as suppliers freezing credit, or your institutional lender such as a Canadian chartered bank being in a position to tighten, suspend or freeze your credit access.

Canadian business financing advisor can assist you in getting back the confidence of suppliers and lenders at a time when you need it most. That comes by providing solutions, both traditional and alternative, to the current problem.

We all know the expression ' you can't see the forest from the trees ' and most business owners / managers would admit they are sometimes to close to the problem, or, alternatively don’t have the expertise and access to outside financing sources. In essence you have just received access to corrective financing actions, at a time when you need it most!

So how in fact does a trusted, credible and experienced Canadian business financing advisor ' fix ' things? One way is to focus on the balance sheet and increase cash flow monetization when it comes to sales to inventory and sales to A/R ratios. This can be accomplished through working capital facilities that are non bank in nature, asset based lines of credit, monetizing your tax credit, securitizing receivables, and in some cases bringing a new chartered bank on board that is comfortable with your management and long term success.

So, need that specialized access to traditional and alternative funding sources. Who you gonna call ?!



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

Direct Line = 416 319 5769

Email = sprokop@7parkavenuefinancial.com

http://www.7parkavenuefinancial.com


Business financing for Canadian Firms , specializing in working capital, cash flow, asset based financing , Equipment Leasing , franchise finance and Cdn. Tax Credit Finance . Founded 2004 - Completed in excess of 100 Million $ of financing for Canadian corporations .

' 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

Confessions Of An SBL Government Loans Super Fan . The Canada Small Business Loan

Tweet

INFORMATION ON GOVERNMENT SMALL BUSINESS LOANS IN CANADA

SBL government loans . I guess you could call us a fan, even a super fan. The word fan comes from the root word ' fanatic ‘, denoting an ' enthusiastic devotee. So why is the Canada small business loan the recipient of our full support. Let's try and preach to some of the potential unconverted.

More and more businesses in Canada, new, and established, are seeking loans backed by the government. Talk about a great co-signer! And remember that we are talking about a loan, not a grant. We're always being asked about ' grant money’... free money in essence. We're sure it's out there somewhere, we just haven't found it, and we're equally believers in the ' there is no free lunch ' concept!

The SBL loan is a great choice for business when you're in a touch economy; it’s all about choosing the right lender under the program and ensuring you are aware of some basic rules and regulations that allow you to qualify for the program. We feel quite strongly that every Canadian business owner can actually do a great job of pre-qualifying themselves in advance.

Let's recap some of those basic qualifications. They include being a Canadian citizen or being eligible to legally borrow in Canada. That's just common sense. Although you only have to only guarantee 25% of the loan personally that comes with the understanding that you have a reasonable personal credit history. In Canada the credit bureaus work on a ‘scoring ' basis, and for purposes of SBL government loans you should at least have a score of 650.

The questions of rates and structures always comes up in connection with questions from clients. Interest rates are ultra competitive given that you business is either completely new, or has under 5 Million dollars in revenue (That’s the revenue cap under the program). Rates on the SBL small business loans are in the 3% over prime range and a small government fee can usually actually be added into the financing of the loan.

Any business financing application has strong elements of one thing - and that’s common sense questions. You should therefore be prepared to address some very basics, including a resume or bio on yourself, a description of your business, a cash flow repayment plan (that’s critical). Additionally some supporting documents are required, all of which in our opinion are again. very ' common sense ' oriented. They include a copy of your tax return, your incorporation data, a premises lease, etc.

It's a great idea to also have a clear idea of the financing you are requesting. The three categories of assets that can be financed under the program are equipment, leaseholds, and real estate. Unfortunately it’s not a cash loan per se, so there are no working capital or cash flow borrowings under the program. And by the way that’s a popular misconception.

We should also add that you need to inject a minimum of permanent equity, in effect your ' down payment ' of 10% of your total borrowing.

It’s strongly recommended that you investigate the power of the Canada small business SBL loan. You just might find you will become a super fan also! Speak to a trusted, credible and experienced
Canadian business financing advisor for help with this great program.








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

Direct Line = 416 319 5769

Email = sprokop@7parkavenuefinancial.com

http://www.7parkavenuefinancial.com


Business financing for Canadian Firms , specializing in working capital, cash flow, asset based financing , Equipment Leasing , franchise finance and Cdn. Tax Credit Finance . Founded 2004 - Completed in excess of 100 Million $ of financing for Canadian corporations .

' Canadian Business Financing With The Intelligent Use Of Experience '

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

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



Stan Prokop

Cash On Hand! What A Concept ! Let Canadian Accounts Receivables Credit Financing Via Factoring Funding Be Your Solution

Tweet

INFORMATION ON ACCOUNTS RECEIVABLE FINANCING CASH FLOW SOLUTIONS

Accounts receivable credit financing is one method in which thousands of firms in Canada generate ' cash on hand '. That phrase is of course the accounting/business term which business owners and financial managers in Canada refer to with respect to their positive cash balances.

Your ability to have cash on hand at any given time provides you of course with the sense of positive feeling that you're able to fund both operations, and hopefully growth. We've observed over the years that Canadian financial statements typically seem to reflect less cash on hand when it comes to monthly or annual financial statements .

Naturally in tougher economic times it is even hard to maintain positive cash balances, and we're quire sure most business owners would maintain that they are not 100% satisfied with their cash position over time. It is of course important to remember that too much idle cash is a negative item - large corporations even risk losing their ownership when suitors circle with the intent of leveraging the firms cash and assets to in effect take their company away from them via a buyout . But we digress...

The pressures that reduce cash flow are obvious to most business owners and managers. They are fluctuating sales, lower profit margins, and the inevitable slow paying clients which these takes take anywhere from 60 to 90 days, even though your terms are net 30. We wish!

Although management of businesses in the small and medium sized sector in Canada (SME) typically focus on survival and daily operations it's clear to all hopefully that cash flow success also translates into ability to grow your business.

So how does business increase the cash cushion. The simply answer is to lower your costs, get extended credit with key supplies, lower inventory levels, improve collections, and monetize current assets .

Factoring receivables focuses on the latter, monetizing your typically largest asset, your A/R. Accounts receivable credit financing, i.e. ' factoring ' allows you to get paid on invoicing, typically getting 90% of your funds as soon as you deliver your product or service. And by the way, that other 10 per cent isn’t the cost of financing! that balance is remitted to you as soon as your customer pays, less financing costs which are typically in the 2% range if your terms and collectability equate to 30 days. Bottom line, all of a sudden your cash cushion of cash on hand is there, and it’s positive!

The receivable financing industry in Canada is fragmented, consisting of a number of large and small players. They offer the benefit of instant cash flow for firms, allowing them to meet the obligations we spoke of, i.e. payroll, government remittances, and growth.

So when should a customer consider factoring receivables. Typically it’s when you yourself have become the financing company you never intended to be, carrying larger amounts of inventory and receivables than you desire. All of a sudden you're in a position to take supplier discounts and entertain larger orders and contracts.

Is accounts receivable credit financing and factoring for your firm. It is if you maintain proper financial records, have generally creditworthy clients, and are in a position to provide those receivables as collateral for the cash flow. Simple as that.

Speak to a trusted, credible and experienced Canadian business financing advisor who can assist your with your ' cash on hand' needs!!




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

Direct Line = 416 319 5769

Email = sprokop@7parkavenuefinancial.com

http://www.7parkavenuefinancial.com


Business financing for Canadian Firms , specializing in working capital, cash flow, asset based financing , Equipment Leasing , franchise finance and Cdn. Tax Credit Finance . Founded 2004 - Completed in excess of 100 Million $ of financing for Canadian corporations .

' 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