Working Capital Business Financing Sources |7 Park Avenue Financial

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Working Capital Business Financing Sources
Here's The Best Advice We Can Give You On Financing Your Business



YOUR COMPANY IS LOOKING FOR CANADIAN WORKING CAPITAL AND BUSINESS FINANCING SOURCES AND ALTERNATIVES! 

You've arrived at the right address! Welcome to 7 Park Avenue Financial

        Financing & Cash flow are the biggest issues facing businesses 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

 

 

small business financing sources

SMALL BUSINESS FINANCING SOLUTIONS IN CANADA

 

Working capital and small business financing sources are available to Canadian business owners and financial managers in several ways.  When we speak to clients about their needs and answer their questions in this area, it is simply a case of pointing out all the alternatives available and discussing what features and benefits of each type of facility make the most sense for their own particular firm and industry.

 

 

SECURED VERSUS UNSECURED LOANS 

 

Most working capital loans and financing alternatives are secured, but that is not the case 100% of the time. With reasonably good financial health and equity in your firm, a cash working capital loan can be achieved at solid rates, terms and structures. This is generally not the norm, though, as most lending to small and medium businesses in Canada is, in fact, secured somehow.

 

SMALL BUSINESS FINANCING VERSUS LARGER CORPORATE FINANCE SOLUTIONS

 

For larger corporations, unsecured cash flow loans are more often than not called ‘subordinated debt,' and they are term loans structured around the analysis of the company’s ability to repay based on future cash flow forecasting.

 

 Small business financing for smaller firms is simply a working capital loan that might have some covenants attached relative to ongoing profits and cash flow metrics.  Again, we can summarize these offerings by saying that cash flow unsecured loans are generally only available to firms with very reasonable financial health and prospects and qualify for bank loan criteria for approval.

 

ASSESSING TYPES OF WORKING CAPITAL LOAN SOLUTIONS

 

In certain cases, the working capital and cash flow loans we have described above often relate to acquiring a business, with the funding provided to acquire the business.

 

LOANS VERSUS CREDIT LINES

 

A more common ‘working capital loan' is, in effect, not a  business loan per se but the financing of receivables and inventory. In effect, your firm leverages these assets and turns them into ongoing working capital as you create inventory and receivables on an ongoing basis.

 

start-up financing sources for businesses in canada

 

THE GOVERNMENT OF CANADA SMALL BUSINESS FINANCING PROGRAM

 

Many business owners come to us and ask if there are ‘government loans' for working capital. The reality is that there is not anything available in Canada in that regard. The most common, successful and popular government loan program is the CSBFL program; thousands of businesses utilize this loan. The program is one of the best loans to small businesses in Canada - bar none. A solid business plan is a key requirement of the program - 7 Park Avenue Financial prepares business plans for clients that meet and exceed bank and other commercial lender requirements.

 
WHAT DO GOVERNMENT LOANS FINANCE? 

 

However, as we have noted, it does not provide working capital as in a line of credit, and some business owners are dismayed when we advise them that this loan program only covers three items.

 

Equipment

Leasehold improvements

Real estate

 

 
DON'T FORGET TO FOCUS ON ASSET TURNOVER AND REDUCE YOUR FINANCING COSTS 

 

When looking for a working capital solution, there are some critical factors to assess and address. Many firms we meet can, in fact, cure their own working capital solutions by affecting a better turnaround in their receivables and inventory. Those are the key working capital components of any firm.

 

If your firm has been self-financing, you should consider a working capital or an invoice discounting facility. This injects immediate working capital into your company and is not treated as a loan on your books. You are simply converting A/R, and in some cases inventory, into immediate cash.

 
THE SHORT TERM WORKING CAPITAL LOAN REVOLUTION  

In some cases, a merchant cash advance, also known as a short-term working capital loan, might make sense for your business. These loans also finance future revenues receipts from credit cards / future credit card sales, which might be applicable for a retailer.

 

Many business owners we meet don’t even do basic cash flow planning. A straightforward template you can set up can easily show you what cash is coming in over the next three months, for example, and you already know your fixed and variable expenses. It’s as simple as that.

 

Working capital needs can be either short-term or long-term in nature. The cash working capital term loan we spoke of earlier is a long-term solution for permanent working capital. On the other hand, converting your receivables and inventory via a working capital facility via a non-bank is immediate short-term cash flow.

 

sources of finance for small business in canada

 

CONCLUSION - SOURCES OF FINANCING IN CANADA

 

Those venture capitalists/ angel investors not in sight !? ( Venture capital in Canada is for the smallest percentage of borrowers in Canada - and requires you to, of course, give up owner equity. Friends and family are a solution, but rarely the right one unless you're bootstrapping a startup or are ok with an angel investor-type partner.

 

Work with a trusted, credible, and experienced advisor in real-world Canadian Business Financing solutions for small businesses in Canada.

 

Let the  7 Park Avenue Financial team assess your needs, evaluate the solution, and focus on implementing a facility based on the benefits of that type of financing. That is cash flow and working capital planning 101 when you want to finance your business for the growth potential you want to achieve.

 

FAQ: FREQUENTLY ASKED QUESTIONS

What are the benefits of alternative lending?

Some may think that when a person needs to get financing, they are forced into traditional methods like loans from banks. However, there is an alternative option for entrepreneurs looking for working capital and startup funding; it's called "alternative lending." 

Successful startups and growing companies need working capital to grow. With no funding, they may never get off the ground at all--a scary reality for any entrepreneur seeking success in today's competitive market. If you're looking to avoid a traditional lender route, many options are available that could help a  business thrive! Finding out more about alternative financing methods is the first step towards getting what you deserve when it comes time to grow revenues and profits.

 

 

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

' Canadian Business Financing With The Intelligent Use Of Experience '

 STAN PROKOP
7 Park Avenue Financial/Copyright/2022

 

 

 

 

 

Stan Prokop is the founder of 7 Park Avenue Financial and a recognized expert on Canadian Business Financing. Since 2004 Stan has helped hundreds of small, medium and large organizations achieve the financing they need to survive and grow. He has decades of credit and lending experience working for firms such as Hewlett Packard / Cable & Wireless / Ashland Oil