YOUR COMPANY IS LOOKING FOR CASH FLOW SOLUTIONS!
SOLVING YOUR CASH FLOW PROBLEMS
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
"Stop watching your profitable business suffocate from lack of cash - there's a better way to avoid cash flow problems "
7 Park Avenue Financial originates business financing solutions for Canadian Businesses – We offer Solutions to business cash flow problems and working capital solutions – Save time, and focus on profits and business opportunities
7 Park Avenue Financial: “Canadian Business Financing with the intelligent use of experience”
How Do I Solve a Business Cash Flow Problem?
As a business owner, your business cash flow problem seeks a solution.
Many Canadian business owners and financial managers are often shocked by the age-old problem of a working capital/cash flow shortage.
REVERSE THAT CASH FLOW CRISIS TO A STRATEGIC ADVANTAGE!
Great sales revenues don't translate into healthy cash flow. Payables increase, and your investment in carrying accounts receivables and inventories grows—it's a vicious cycle!
Let the 7 Park Avenue Financial team demonstrate innovative, real-world financing solutions that will allow you to regain control and grow!
3 Uncommon Takes on problems around cash flow:
- Cash flow problems can accelerate innovation by forcing businesses to discover creative financing alternatives when faced with negative cash flow.
- Seasonal cash flow challenges create opportunities for counter-cyclical business model adaptation for positive operating cash flow.
- Digital payment optimization can solve 40% of traditional cash flow issues through payment timing manipulation around a/p business expenses.
CASH MANAGEMENT AND ASSET TURNOVER HELP CREATE PROFITS
Every business goal revolves around creating profits. As that process works itself through your business cash flow cycle, you should constantly try to manage cash and improve asset turnover to avoid cash flow issues to determine how much cash is needed
The business owner’s ability to manage and finance working capital allows it to generate equity, pay taxes and employees, keep supplier short-term relations positive, etc.
Calculations around working capital cash flow typically revolve around the relationship of current assets and current liabilities on your balance sheet.
WHAT IS THE OPERATING CYCLE
A great way to examine your business is to constantly focus on what we call the ‘ operating cycle ‘. It’s essentially the ‘ journey ‘a dollar takes as it travels through your company.
Two drivers in understanding your cash and working capital are:
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Revenue recognition
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Accounts payable management
Understanding the causes of cash flow issues, such as late client payments and disorganized bookkeeping, is crucial for maintaining positive cash flow.
Business owners should also check out their cash flow statement, which is a key part of business financial statements, allowing you to see cash from a ‘ where got /where gone ‘ perspective.
DON'T FORGET PAYABLES AND CASH FLOW MANAGEMENT
While not often directly understood, most business owners /managers understand that managing payables is a key part of the cash cycle.
You increase your cash from operations by delaying payables to the extent you can, given that you don’t want to damage supplier relations. Delaying payables, your significant ' current liabilities ' asset is working capital management to the extent you can give vendor payment terms, etc.
BUDGETING YOUR CASH FLOW
Understanding the difference between cash flow and budget is crucial for effective financial management.
Cash flow refers to the real-time movement of money in and out of a business, showing a company's liquidity and immediate financial reality.
On the other hand, a budget is a forecasted plan that outlines expected income and expenses over a period. It serves as a financial roadmap that sets financial goals and limits for a business.
A cash flow statement provides a snapshot of a company’s financial situation, detailing where the money comes from and where it goes.
This real-time insight helps business owners make informed decisions about their company’s financial health.
Conversely, a budget helps plan and set financial targets, ensuring the business stays on track to meet its long-term goals. By understanding both concepts, business owners can better manage their finances and ensure their company’s financial stability.
FINANCING YOUR INVESTMENT IN A/R AND INVENTORY
If your business isn’t a retail or online business, you have an investment in accounts receivable.
Maintaining a cash reserve is essential to manage cash flow problems effectively and ensure financial stability during challenging times.
Numerous financing solutions exist to allow you to better access real cash, as opposed to the non-liquid A/R and inventory build-up on your balance sheet.
Those solutions include:
A/R Financing
Inventory Loans
Access to Canadian bank credit
Non bank asset based lines of credit
SR&ED Tax credit financing
Equipment / fixed asset financing
Cash flow loans
Royalty finance solutions
Purchase Order Financing
Short Term Working Capital Loans/ Merchant Advance
Securitization
WHAT THOSE TEMPORARY CASH FLOW PROBLEMS!
If our businesses were straight lines with totally repeating ongoing transactions, many common cash flow problems would disappear. Unfortunately, that is rarely the case, so seasonal and bulge situations often occur, often along the lines of the ‘cash flow shock’ we talk about.
The owner/manager’s ability to forecast seasonality and bulges in business will always alleviate working capital shock.
WHAT TYPE OF BORROWING FACILITY DO YOU NEED?
The most common solution to the business cash flow problem is the ability to ensure you have a borrowing facility in place that allows your company to address future cash flow uncertainty.
Ensuring adequate cash reserves is crucial for addressing future cash flow uncertainty and maintaining financial stability.
If your firm has profits, historical cash flow, and acceptable financials, chartered banks and business credit unions are the long-term solutions.
FINANCING THE BALANCE SHEET
As long as you have business assets (receivables, inventories, equipment, orders/contracts), numerous non-bank solutions exist to give you the illusion of cash flow availability.
Understanding your company's financial health is essential for making informed decisions and managing cash flow effectively. Funding current assets is a vital part of addressing a cash flow crunch.
DID YOU KNOW?
- 82% of business failures are due to poor cash flow management
- 60% of small businesses experience cash flow problems regularly
- Average payment terms have increased from 30 to 45-60 days
- 29% of businesses fail due to running out of cash
- Cash flow problems cause 37% of small business owners to miss growth opportunities.
KEY TAKEAWAYS
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Active receivables management transforms collection speeds dramatically while requiring minimal system changes.
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Strategic supplier payment scheduling maximizes available working capital without disrupting operations.
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Real-time cash flow forecasting prevents 80% of common cash shortfalls through early detection.
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Inventory optimization releases trapped cash while maintaining necessary stock levels.
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Customer payment term restructuring improves cash position without significant revenue impact
Professional Help
Poor cash flow management can lead to serious financial difficulties, including shortfalls and business failure. If you’re struggling with cash flow problems, seeking professional help from a Canadian business financing advisor such as 7 Park Avenue Financial, even your accountant can be invaluable in these matters.
A financial advisor can guide cash flow management, help you develop a cash flow statement, and identify areas for your company’s financial health improvement.
An accountant can help you implement effective accounting practices, such as cash flow projections and budgeting, to manage your cash flow more effectively.
By seeking professional help, business owners can better understand their company’s financial health and develop strategies for improving cash flow management. This guidance can be crucial in navigating financial challenges and ensuring the long-term success of their business.
CONCLUSION
If you're looking to avoid small business cash flow problems, ensure you have access to financing solutions that address your company is right stage ( start-up, mature, high growth, turnaround, etc ) to grow products and services.
Call 7 Park Avenue Financial, a trusted, credible and experienced Canadian Business Financing Advisor who can assist you with your financing needs. It's all about how much you need to satisfy enough cash to fund your company.
FAQ
How does solving cash flow problems increase business stability?
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Enables predictable growth planning
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Strengthens vendor relationships
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Improves credit standing
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Creates emergency reserves
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Allows for strategic investments
What immediate benefits come from cash flow optimization?
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Reduced stress and better sleep
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Improved supplier terms
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Enhanced banking relationships
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Greater negotiating power
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Increased profit margins
How can better cash flow management increase profitability?
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Eliminates expensive last-minute financing
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Captures early payment discounts
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Reduces overhead costs
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Optimizes inventory carrying costs
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Improves operational efficiency
When do cash flow improvements show measurable results?
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Initial impact within 2-4 weeks
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Major improvements in 60-90 days
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Long-term benefits within 6 months
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Sustainable changes within 1 year
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Compound benefits thereafter
What competitive advantages come from strong cash flow?
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Better pricing from suppliers
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Increased market opportunities
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Stronger growth potential
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Enhanced acquisition power
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Improved stakeholder confidence
What are early warning signs of cash flow problems?
How do seasonal fluctuations affect cash flow?
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Revenue peaks and valleys
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Inventory buildup periods
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Staff scheduling impacts
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Marketing expense timing
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Working capital requirements
What role does technology play in cash flow management?
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Automated collection systems
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Real-time monitoring tools
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Predictive analytics
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Payment processing optimization
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Integration capabilities
What financing options help with cash flow?
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Invoice factoring
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Line of credit
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Purchase order financing
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Equipment Financing
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Merchant cash advances
How does poor cash flow affect growth opportunities?
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Missed expansion chances
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Limited marketing budgets
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Restricted hiring ability
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Reduced investment capacity
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Competitive disadvantage
What makes cash flow different from profit?
How do payment terms affect cash flow?
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Collection cycle length
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Vendor payment timing
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Discount opportunities
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Working capital needs
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Seasonal adjustments
What role does forecasting play in cash flow management?
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Prediction accuracy
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Problem prevention
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Resource allocation
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Strategic planning
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Risk management
