YOUR COMPANY IS LOOKING FOR BUSINESS FINANCE SOLUTIONS!
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?
CONTACT:
7 Park Avenue Financial
South Sheridan Executive Centre
2910 South Sheridan Way
Oakville, Ontario
L6J 7J8
Email - sprokop@7parkavenuefinancial.com
Tel- 416 319 5769
"Working capital is to business what oxygen is to breathing - you can't survive long without it." - Anonymous Business Leader.
7 Park Avenue Financial originates business financing solutions for Canadian Businesses – We offer Business Finance 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”
WORKING CAPITAL BUSINESS FINANCING SOLUTIONS
Business finance solutions for your company often require a ‘backup plan.’
Why? When it comes to working capital and cash flow financing needs, there is rarely enough. How does the owner/mgr/entrepreneur perfect those requirements? Let’s dig in.
Like consumer debt, it should be no secret that there are good ‘debt’ and ‘bad’ debt. In your company, there is only so much equity in the business.
In many cases, acquiring more debt is either impractical or impossible, given that the financing interest can’t be supported. That’s the whole concept of successfully understanding ‘leverage’ - i.e., knowing how much borrowing your company can take on… before failing or succeeding.
TURN WORKING CAPITAL CHALLENGES INTO OPPORTUNITIES
Are you running a business in Canada but feeling trapped by insufficient working capital?
Daily operations strain your resources while growth opportunities slip away. Let the 7 Park Avenue Financial team show you innovative working capital business finance solutions that can transform your cash flow challenges into strategic advantages, providing the flexibility needed to seize market opportunities and fuel sustainable growth.
3 Uncommon Takes on financing working capital :
- Working capital financing can reduce overall business costs by enabling early payment discounts from suppliers
- Strategic working capital management can serve as a competitive advantage in negotiations with larger clients
- Seasonal businesses can use working capital analytics to predict and prepare for cash flow variations with 85% accuracy
HOW DO YOU CALCULATE WORKING CAPITAL
To calculate working capital, use the formula: current assets minus current liabilities. This calculation is significant as it assesses a company's financial health, liquidity, and ability to meet short-term obligations. When working is negative, your company's current liabilities are greater than its current assets,i.e.sort term liabilities. That is essentially the working capital ratio formula.
The good news about the ‘right’ financing solutions for your business is that they allow you to grow sales and profits and keep up with accounts payable outside of your current capital base.
It’s all about your cash flow statement and managing your current assets and current ratio formula, which are key parts of your firm’s financial statements. It’s safe to say that companies that can grow and control their growth are the perfect targets for all sorts of business finance solutions that make sense.
Effective working capital management directly impacts a company's financial health and its ability to meet financial obligations, positioning businesses for future growth and resilience against financial challenges.
WAYS TO IMPROVE YOUR CASH FLOW MANAGEMENT AND WORKING CAPITAL / TIPS TO AVOID CASH FLOW ISSUES
What are some balance sheet and revenue monetization finance solutions that enhance cash flows and a company’s liquidity through solid cash flow management and reverse the negative working capital trend in those financial statements?
They include:
A/R Financing** -** accounts receivable finance solutions
Inventory Loans
Bank revolving credit facilities** -** generating net working capital via monetizing your sales
Non-bank asset-based lines of credit
PO Financing** -** Purchase inventory and funding accounts payables for large orders and contracts to meet the demand of clients for new markets and other growth challenges.
Royalty finance
Unsecured cash flow loans
Equipment Financing / sale-leasebacks - acquiring fixed assets and technology to run and grow your business on payment terms based on business cash flow and asset matching of the useful economic life of business assets
Commercial mortgages** -** payment terms to fund owner-occupied premises - properly structured long-term debt to match real estate investments of the business
Working Capital Loan** -** short-term debt solutions to meet short-term obligations - a typical short-term working capital loan is one year in duration and based on sales/cash flow. Working capital loans are easier to access from non-bank financial institutions and increase liquidity.
Positive working capital reflects a company's short-term liquidity and financial stability, enabling it to meet short-term obligations and invest in growth.
Many different companies require financing that’s most suited to their industry. Capital-intensive firms requiring large amounts of asset financing differ from service companies with a small or no asset base.
DEBT VERSUS EQUITY
That whole debt versus equity issue is also a key part of Canada’s business banking equation.
Companies that can’t meet the typical debt-to-equity ratios that banks insist on are forced to consider alternative forms of financing - the good news being that those are more abundant and creative every day - allowing you to meet obligations under your current liabilities.
By the way, more current assets aren’t always good. When you focus on improving working capital, it is all about ‘ asset turnover’. Those changes in working capital impact cash flows!
While our Canadian banks are reluctant to let your debt-to-equity ratios go the wrong way, alternative lenders focus on assets and asset monetization. An excellent example of your firm’s operating activities?
That would be the Asset-based line of credit, commonly called ‘ ABL’ in the industry. That credit facility takes your inventory, receivables, and fixed assets and combines them into one ‘ borrowing base ‘based on their real values.
Almost 99% of the time, this facility can easily double your current bank credit lines or provide full cash flow financing when you have no operating loan.
Working on a good cash flow budget for next year will help you anticipate financing needs.
DID YOU KNOW?
- 82% of business failures are attributed to poor working capital management
- The average working capital cycle in Canada is 56 days
- 67% of businesses seek working capital financing for growth opportunities
- Working capital optimization can improve profitability by 20-30%
- 75% of Canadian companies experience seasonal working capital challenges
KEY TAKEAWAYS
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Understanding the cash conversion cycle drives optimal working capital management.
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Maintaining healthy accounts receivable turnover ensures steady cash flow
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Strategic inventory management significantly impacts working capital efficiency
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Proper timing of accounts payable maximizes available working capital
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Leveraging technology streamlines working capital processes
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Calculating working capital is crucial for assessing a company's short-term financial health, understanding liquidity, managing cash flow, and planning for future growth.
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Financial metrics like working capital help make informed business decisions, improve cash flow management, and assess a company's liquidity and operational efficiency.
CONCLUSION: INTERPRETING WORKING CAPITAL & CASH FLOW FINANCING NEEDS FOR ENTREPRENEURS' FINANCIAL HEALTH
The bottom line: Does your business have a working capital management backup plan and a clear line of sight on business finance and working capital and cash flow financing solutions?
Call 7 Park Avenue Financial, a trusted, credible and experienced Canadian business financing advisor who can help you perfect those arrangements for business growth and move forward with financial modelling and real-world funding solutions you can access today.
FAQ: FREQUENTLY ASKED QUESTIONS
What documentation do I need for working capital financing? Required documents include:
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6 months of bank statements
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2 years of tax returns
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Current financial statements
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Accounts receivable/payable aging reports
What types of working capital solutions are available?
Options include:
How does working capital financing boost business growth?
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Enables rapid response to market opportunities
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Supports inventory expansion
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Facilitates hiring during growth phases
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Provides emergency cash flow buffer
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Enables bulk purchase discounts
What advantages do working capital solutions offer over traditional loans?
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Faster approval process
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More flexible terms
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No fixed monthly payments
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Based on business performance
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Scalable with business growth
How can working capital financing improve vendor relationships?
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Enables early payment discounts
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Strengthens negotiating position
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Maintains consistent payment schedules
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Builds supplier trust
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Increases ordering flexibility
What impact does working capital have on seasonal business success?
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Smooths out revenue fluctuations
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Enables pre-season inventory building
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Supports year-round staffing
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Maintains operations during slow periods
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Allows strategic purchasing timing
How does optimized working capital affect competitive advantage?
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Enables faster market response
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Improves customer service capabilities
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Supports innovation investments
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Strengthens supplier relationships
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Increases operational efficiency
What exactly is working capital business financing?
Working capital business funding provides flexible funding solutions that help companies manage daily operations, inventory, and growth opportunities while maintaining healthy cash flow.
How long does the application process typically take?
Most working capital finance applications receive initial approval within 24-48 hours, with funding available within 5-7 business days after documentation submission.
What credit score requirements apply?
Working capital solutions typically require minimum credit scores ranging from 550-650, depending on the specific financing type and provider selected.
Are there industry restrictions?
Working capital financing is available across most industries, though terms and conditions may vary based on industry-specific risks and revenue patterns.
What happens if business performance decreases?
Many working capital solutions adjust with business performance, offering flexibility during slower periods while scaling up during growth phases.
What makes working capital different from other business financing?
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Focuses on operational needs to meet current financial obligations
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Provides revolving access to funds
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Links directly to business performance
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Offers flexible repayment terms
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Scales with business growth
How does working capital impact business valuation?
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Demonstrates operational efficiency
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Affects liquidity ratios
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Influences growth potential
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Impacts risk assessment
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Determines borrowing capacity
What is working capital in a cash flow statement?
A company's working capital is the difference between its current assets and liabilities.
What is included in working capital?
Working capital can be defined as the difference between current assets and liabilities. Current Assets are cash, accounts receivable/customers' unpaid bills, and inventories of raw materials or finished goods, while Current Liabilities include debts owed by a company, like credit card debt.
The working capital ratio shows how much an organization has for its day-to-day operations without considering significant investments.
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