YOUR COMPANY IS LOOKING FOR CASH FLOW FINANCING!
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
"Cash flow loans empower businesses to harness their future earnings for today's operational needs."
"Unlock your business potential with immediate funding through cash flow loans!"
7 Park Avenue Financial originates business financing solutions for Canadian Businesses – We offer CASH FLOW LOAN solutions that solve the issue of cash flow and working capital – Save time and focus on profits and business opportunities
BUSINESS CASH FLOW LENDING
Introduction to Cash Flow Challenges
Cash flow financing challenges and working capital solutions for Canadian businesses. Keeping your firm solvent/liquid can almost seem like a crisis sometimes.
We were talking to two of our favourite business marketing gurus the other day and one of them commented, 'it's like a knife fight in a phone booth!’... Wow, we thought, could there be any more apropos comment than that when it comes to business competition and business survival?!
Securing a cash flow loan can be the key to sustaining day-to-day business operations and fueling growth for many small and medium enterprises (SMEs). Cash flow / working capital loans bridge the gap between receivables and payables, provide a crucial lifeline to fund sales and ensure your focus on having positive cash flow.
Understanding Cash Flow Challenges
Naturally, it's important to be in a position to ensure you understand the nature of those challenges, why they occur, how to measure or track them, and finally... put financing in place that ensures business liquidity.
Statistics and the Importance of Working Capital
There is a lot of statistics out there that say that a majority of businesses in the SME sector fail in their first 5 years in business. They simply didn’t have the access to the capital they needed to survive. Ever since the 2008 recession/financial debacle cash flow and working capital have become 'job 1' for Canadian business owners and financial managers.
Complacency in Successful Times
Having observed Canadian business for over 40 years now the one thing that never surprises us is the fact that when a business is enjoying strong success there often exists a general sense of complacency that exists within the company. Cash flow seems kind of ok... and if it isn't we've got the bank to support us, right? The bottom line on that one - fast growth and sales can hide a lot of problems... for a while.
Basic Needs of Working Capital
The need for working capital for your company arises out of some basic needs - pay suppliers, finance, growth, ensure banks and other creditors are happy.
Solvency and Liquidity
One term used in business is 'technically solvent' - the basics on that one are that you have more assets than debts. That's the key to our message today - simply that that is just a calculation, and calculations don't pay bills.
Monetizing Assets for Liquidity
Your ability to finance and monetize those assets is what liquidity is all about. Oh, and by the way, if your balance sheet shows more liabilities than assets you're technically bankrupt!
Strategic Financial Management
As we have said, you need financing solutions to properly fund those assets, and that growth over time. It also helps that you are focusing on asset turnover - collecting receivables on time, turning inventory within your industry norms, and not mismatching short-term cash outflows with long-term obligations.
Monitoring Financial Health
How can the business owner or finance manager monitor just how good, or bad the overall situation is? Some very simple calculations such as your day's sales outstanding, inventory turns, and debt to equity calculations can provide tremendous insights. Monitoring these over time can provide very relevant information on an approaching crisis.
When Banks Withdraw Support
When your bank no longer seems to support you in a manner that you require we would offer up that they have also been benchmarking those same calculations on your financials. By then it is often too late to mend and repair that bank relationship.
Solutions for Working Capital Challenges
In Canada, there are several working capital solutions for that 'knife fight in the phone booth', that proverbial battle for cash flow survival.
Various Financing Tools
Those tools include bank facilities for those who qualify. Other solutions include:
Receivable financing
Inventory Financing
Leasing assets or sale-leaseback scenarios,
Asset based line of credit that margins A/R, inventory, and equipment all under one revolving facility.
Two other relatively unknown of solutions are:
Monetizing your tax credits & supply chain financing / po financing
KEY TAKEAWAYS
Types of Cash Flow Loans: Understanding different structures, such as invoice financing and merchant cash advances, is crucial.
Qualifications for Borrowing: Criteria typically include credit scores, financial history, and cash flow projections.
Interest Rates and Terms: These loans often come with varied terms and rates, affecting the total cost of borrowing.
Application Process: Familiarity with the application steps ensures preparedness and increases approval chances.
Benefits of Cash Flow Loans: They offer quick access to capital based on predicted sales, improving liquidity for immediate needs.
Conclusion: The Importance of Working Capital Management & Financing
Why should you consider these working capital solutions? Several reasons, including finally having a handle on accurate and timely information. Also, you prefer to manage growth, not fail from it. Managing day-to-day cash flow crisis is not … fun!
Call 7 Park Avenue Financial, a trusted, credible and experienced Canadian business financing advisor on how your firm can successfully win the cash flow challenges you face every day.
FAQ: FREQUENTLY ASKED QUESTIONS / PEOPLE ALSO ASK / MORE INFORMATION
What are the primary benefits of a cash flow loan?
Businesses benefit from immediate capital infusion based on future revenue projections, enhancing operational cash flow and enabling growth investments.
How do cash flow loans differ from traditional loans?
Unlike traditional loans, cash flow loans are secured against the company's projected future earnings rather than physical assets.
What should businesses prepare for when applying for a cash flow loan?
Preparation should include detailed financial statements, cash flow forecasts, and a robust business plan to demonstrate repayment capacity.
Who qualifies for a cash flow loan?
Typically, businesses with a solid track record of revenue and a predictable cash flow pattern are ideal candidates for a working capital or short term loan.
Why might a cash flow loan be declined for credit approval?
Common reasons include poor credit history, inadequate cash flow projections, or a business model deemed risky by lenders.
How does invoice financing work as a cash flow solution?
This involves borrowing against the amounts due from customers and providing immediate cash based on outstanding invoices. Invoice finance is a subset of asset based loans offered in Canada.
What is the impact of a cash flow loan on business credit?
If managed properly, it can improve credit by demonstrating creditworthiness and timely repayment ability; however, mismanagement might lead to adverse effects if forecasted cash flow and sales don't materialize.
Can startups secure cash flow loans?
Startups may qualify if they can show strong market potential and a credible financial forecast despite lacking a lengthy financial history and the ability to qualify for an unsecured loan from a traditional financial institution. A personal guarantee will be required in almost all cases when sales and business assets don't fully suffice.
How does cash flow lending work?
Lenders require comprehensive financial documentation around future cash flows, proof of consistent income, and often a credit score check to assess risk .
How quickly can a business access funds from a cash flow loan?
Depending on the lender, funds can be available as quickly as within a few days of application approval compared to longer waits for business financing such as traditional bank loans.
What are the long-term impacts of taking a cash flow loan?
Strategically used, busines cash flow loans can facilitate growth and stability; however, dependency without strategic planning can lead to financial strain.
