Sources Of Financing Working Capital Cash Flow | 7 Park Avenue Financial

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YOUR COMPANY IS LOOKING FOR CANADIAN SOURCES OF WORKING CAPITAL AND CASH FLOW FINANCING! 

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        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

Sources of financing require business owners & financial managers in Canada to get 'hard-wired' into real-world accessible financing to solve their working capital and cash flow challenges. Let's dig in.

GROWTH FINANCING   

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

HOW DO CHANGES IN WORKING CAPITAL AFFECT YOUR ABILITY TO GROW SALES OF PRODUCTS AND SERVICES

Those firms that have been in business a while, are growing their sales, and have the ability to sell products in other geographies are always strong candidates for new financing. But changes in working capital needs will often require higher investments in balance sheet accounts such as a/r and capital equipment needs in the fixed assets area of your business. Your financial statements will tell the story around issues such as long term debt capacity and whether your firm has enough cash to fund operations and consider growth financing.

Tapping into financing sources and lines of credit 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 we are in Covid 19 pandemic times also, and 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-brick 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 are investments in computers, software and other technologies

Asset-based lenders - equipment, receivables and inventory - non-bank line of credit solutions for short term financial health

Purchase Order and Inventory financing firms

Factoring Companies - i.e. accounts receivable financing - That ability to get a/r converted into cash is key to day-to-day funding success when cash is tied up in receivable investments.

Tax credit monetization firms - i.e. SRED/SR&ED tax credit financing helps recover cash flows from r&d investments

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.

 Net Working capital financing in our terms means several obvious solution - it's all about addressing the ' cash conversion cycle ' in your business as well as the related working capital management of current liabilities such as accounts payable

Monetizing your current assets such as receivables and inventory - it's short term balance sheet financing that works

Cash flowing items such as SR&ED credits

Entering into a government  term loan / business loans via the Canada Small Business Financing Program

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 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 financing sources for working capital and cash flow, you understand the meaning behind the jargon. Determine whether you are looking for liquid operating capital or a longer-term working capital solution. Real estate typically requires long-term financing via commercial mortgages or business loans.

 A recent BDC study concluded that 1/3 of all businesses in Canada have difficulty accessing financing to run and grow their business as well as managing their assets and liabilities -  Is that you?

CONCLUSION

Seek out and speak to 7 Park Avenue Financial,  a trusted, credible, and experienced financing advisor who can guide you through the Canadian working capital maze and determine the best cash flow and source of financing for your long-term growth and profits.

Click here for the business finance track record of 7 Park Avenue Financial

Stan Prokop
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