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YOUR COMPANY IS LOOKING FOR BUSINESS CREDIT VIA BANK FINANCING AND OTHER ALTERNATIVES
BUSINESS LOANS AND LINES OF CREDIT
You've arrived at the right address! Welcome to 7 Park Avenue Financial
Financing & Cash flow are the biggest issues facing business today
ARE YOU UNAWARE OR DISSATISFIED WITH YOUR CURRENT BUSINESS FINANCING OPTIONS?
CALL NOW - DIRECT LINE - 416 319 5769 - Let's talk or arrange a meeting to discuss your needs
EMAIL - sprokop@7parkavenuefinancial.com
7 Park Avenue Financial
South Sheridan Executive Centre
2910 South Sheridan Way
Oakville, Ontario
L6J 7J8
Bank financing in Canada. Business credit is not always viewed in the same way by business owners and financial managers , whether in Covid 19 times or more regular times. In many cases, clients we meet are sometimes even thinking there's some sort of short cuts to quicker access to business bank finance for borrowing needs.
HOW DOES THE BUSINESS OWNER ADDRESS BUSINESS FUNDING VIA TRADITIONAL OR ALTERNATIVE SOURCES
Let's take a look at the proper way of addressing and accessing this critical financing for established and growing companies. And by the way, if you’re not established and doing well there are in fact other small business financing alternatives to financing your business for working capital and term debt needs to cover business expenses and growth plans. Let's dig in.
HOW DO BANKS VIEW BUSINESS LENDING IN CANADA
The key point in achieving bank financing success in Canada is knowing of course how the bank views lending. That's actually the simple part of the puzzle, because, simply speaking, banks are cash flow lenders with a, shall we say ' strong interest ‘in secondary sources of repayment! Those secondary sources include personal guarantees, collateral, etc. They also bring with them the lowest interest rate in Canada - whether it's a variable rate or a fixed, a key benefit of funding via a bank.
WHAT HAPPENS WHEN CASH FLOW AND PROFITS AREN'T SUFFICIENT FOR BANK BORROWING
In fact, that's one of the key challenges you face if your firm in the opinion of the owner and manager has great prospects - because our Canadian chartered banks focus on how predictable your cash flow and profits were in the past. So having a bad current or past year in a number of areas simply puts you behind the 8 ball quite a bit.
THE CANADIAN CHARTED BANK CONUNDRUM - RISK TOLERANCE 101!
While it’s not the concern of business of the business owner/manager one must not forget our banks, which are among the best rated and highest reputation in the world are highly regulated. As Canadians that’s a good thing when it comes to bank stability, solid capital bases etc. That, however, does little for the business owner looking for some maximum thinking or ' out of the box ' thinking.
WHAT DETERMINES BANK INTEREST RATES AND FINANCING APPROVAL
Pricing for bank financing for business credit needs is pretty well the best relative to any other comparable finance solution. However, how is that pricing established? In the end, it’s a combination of collateral you personally and your firm can provide, shareholder equity, the infamous ' cash flow coverage ‘An interesting point?
LIST OF ALTERNATIVES TO BANK FINANCING IN CANADA - SMALL BUSINESS LOANS AND FUNDING SOLUTIONS
Even if your firm has all of those you might find that the bank views your entire industry as unfavourable or high risk, as a result you'll still be significantly challenged when looking for business credit solutions. That's when some of those other alternatives might make sense.
Those include:
A/R Financing
Inventory Loans
Access to Canadian bank credit / line of credit revolvers
Non bank asset based lines of credit
SR&ED Tax credit financing
Equipment / fixed asset financing/Equipment Purchase Loans
Cash flow loans/Mezzanine term loans
Royalty finance solutions
Purchase Order Financing Credit Lines
Short Term Working Capital Loans/ Merchant Advance/Business Credit Cards Good credit score required!
Securitization
HAS YOUR BANK DEMAND LOAN BEEN CALLED? IS YOUR COMPANY IN THE SPECIAL LOANS CATEGORY?
Many small businesses find themselves in the unfortunate position of being place in SPECIAL LOANS if they default on their bank covenants, unable to meet repayment terms and the terms and conditions of their loan agreements. We again point out to clients in that position that there are numerous non-bank alternatives to being rescued from special loan designation, including removing some of the stress around the personal guarantee scenario.
One other conundrum of the business owner seeking bank capital in Canada is ' GROWTH ‘. Growth is a good thing, right? Not so fast mister... or Mrs.! That is because when it comes to growth financing that means using cash, not generating cash, and banks historically wrestle with that issue. Again, that’s where some of those non-bank solutions work best!
CONCLUSION
There is no real short cut to bank financing and business credit in Canada for a loan request. Make sure to try and see it through the bank's eyes, not your entrepreneurial 'special vision' glasses!
Seek out and speak to a trusted, credible and experienced Canadian business financing advisor who can assist you with bank needs and alternatives sources of capital for financing solutions required to run and grow a business.
Click here for the business finance track record of 7 Park Avenue Financial
Stan Prokop
7 Park Avenue Financial/Copyright/2020/Rights Reserved
