YOUR COMPANY IS LOOKING FOR INVOICE FINANCING AND A
FACTORING FINANCING RECEIVABLES SOLUTION!
AR Factoring / Account Factoring 101!
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 FOR A FACTORING COMPANY
CALL NOW - DIRECT LINE - 416 319 5769 - Let's talk or arrange a meeting to discuss your needs
EMAIL - sprokop@7parkavenuefinancial.com
Financing receivables in Canada. It's no secret that invoice finance, aka ' invoice factoring ' is part of the ' new normal ' when it comes to Canadian business financing. The factoring of accounts receivables can help your firm regain solid working capital footing.
IS CASH FLOW FINANCING A CHOICE OR NECESSITY FOR YOUR COMPANY
There are probably thousands of Canadian businesses who constantly feel they are living on short term borrowed time. That is why invoice financing, collateralized by a 'lien' on your receivables has become a solution of either choice or necessity for the business owner or financial manager.
Oh, and by the way some of the biggest corporations in the world also utilize this method of accounts receivable factoring/invoice factoring financing for their growth and managing their often largest asset, the A/R!
CLIENTS DONT ALWAYS PAY THEIR INVOICES PROMPTLY
A lot of the activity around financing receivables is, unfortunately, being driven by... yes; you guessed it, your clients. Why is that? Simply because they either by policy, or practice, have chosen to slow down their payments to yourself. We're aware of one case wherein one of the largest companies in the world advised their printers they would pay all invoices on 120-day terms. Talk about a painful hit to cash flow! That's where accounts receivable factors can help.
While we certainly realize that the typical payments from your clients are probably closer to 60 days these days, (that kind of seems to be the new norm) it allows a financing receivables strategy via factoring receivables to ensure you take much less of a hit on your cash flow and working capital.
The triple whammy. That's our own term for what else is happening out there in the Canadian business financing marketplace. Your suppliers slow down, bank financing becomes harder to achieve, and you still want and have the ability to grow your company. Talk about a perfect storm that comes together to challenge your firm in every manner!
LOOKING FOR A STABLE SOURCE OF FUNDING
One of the reasons that invoice finance is so popular these days is simple that is a ' stable ' source of funding for your firm. What business owner or manager doesn't want a reliable source of funding and working capital .in the current economic environment? That is a basic premise of invoice financing or factoring - the fact that your facility can be reviewed anytime, within pretty well a day's time, to be increased based on your needs.
THE COST OF FACTORING RECEIVABLES
Cost is often a factor that turns off many clients who look at financing and factoring of accounts receivable. While the cost is higher than traditional bank finance that has to be balanced off against access to capital. It is important to understand the ' factoring discount ' , which is the fee, ( not an interest rate ) which is the finance charge ( usually 1.5-2%) levied by the A/R factoring company. Invoice discounting facilities is all about understanding your fee and other costs .
In trying to present a balanced outlook on invoice finance we also note that you typically have to report more regularly on your business progress - that typically includes monthly reporting on aged receivables, payables, and a balance sheet and income statement snapshot. We don’t think that necessarily is a bad thing though, as many clients tell us that process allows them to understand and run their companies better.
Choosing the right financing company to fund your outstanding invoices requires some industry knowledge or the assistant of a Canadian business financing expert.
CONCLUSION
Small and medium-sized businesses in Canada are often in a constant need of working capital. Sales are growing, client relations are good, but the ability to promptly collect receivables to term is a constant challenge as the supply chain tightens up on both terms and payables.
Many firms do not have the luxury of achieving a bank credit line to finance their growth and investment in a/r - therefore the ability to use a receivable finance facility is paramount in being successful and running day to day business effectively. That allows your firm to meet payroll obligations, maintain good and valued terms with suppliers and purchase inventory as you need it.
So, if you want to stop that feeling of ' borrowed time ' let an invoice finance firm ' lien ' on your receivables via an invoice factoring loan. That immediate uptick in cash flow and working capital should allow for better business performance... with less stress! Speak to a trusted, credible and experienced Canadian business financing advisor today on how invoice finance works, for you.
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Stan Prokop 7 Park Avenue Financial/Copyright/2020
