YOUR COMPANY IS LOOKING FOR A WORKING CAPITAL FACILITY!
UNTIE WORKING CAPITAL VIA THE RIGHT CASH FLOW LOAN
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?
CONTACT US - 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
Growth financing is the strategic cornerstone that empowers businesses to expand, innovate, and outperform the competition.
Unlock the potential of your business with the right financing solution – say goodbye to cash flow worries!
7 Park Avenue Financial originates business financing solutions for Canadian Businesses – We offer WORKING CAPITAL FACILITY solutions that solve the issue of cash flow and working capital – Save time and focus on profits and business opportunities
Why Every Business Needs a Working Capital Facility
INTRODUCTION TO WORKING CAPITAL FACILITIES
Business cash flow in Canada. We see business owners and managers struggle to sometimes just grasp the term, let alone the solutions that are required to achieve a proper working capital facility that meets their needs around funding operating activities. Should there be a need to feel ' awkward ' about cash finances - we don't think so and here is why. Let's dig in!
Working capital facilities provide financial solutions to bridge the gap between short-term financial needs and the revenue inflows of a company.
This form of financing is critical for businesses aiming to manage their daily operations smoothly while also planning for future expansion. Leveraging a working capital facility allows a company to fund day-to-day obligations and finance key asset categories such as receivables and inventory.
UNDERSTANDING CASH FLOWS & WORKING CAPITAL IN YOUR BUSINESS
In any industry there are of course some specialized terms - the tech ones seem a bit overwhelming to us at times! In finance, the concept of ' cash flow ' mesmerizes' many owners/managers.
And the additional reality is that lenders, bankers, and others will often judge you and your business on your grasp of that concept and ratios by looking at current assets and current liabilities. Short-term focus on your current business capital structure is key, as is asset turnover in receivables and inventory. It's all about financing the balance sheet as well as effective accounts payable management.
PROFIT DOES NOT ALWAYS EQUAL CASH FLOW - IN FACT IT RARELY DOES
So a lot of people talk ' cash flow ' (us included!). Not everyone has a handle on it. While the ' true' cash flow statement is in fact PAGE 3 of your financial statement ( right behind the balance sheet and income statement ), the term if very well confused by many because they somehow think its the same thing as ' profit', ' income', ' revenue', etc. It is not those!
The fundamental way to explain it is one that most businesses in the SME sector can relate to - payroll. Your company has delivered a product or service, you are waiting to get paid, and there is not enough cash in the bank to pay salaries! That's the crux of the business cash flow.
HOW DO YOU CONTROL INFLOWS AND OUTFLOWS OF FUNDS?
When the Canadian business owner and manager are in fact in control of cash flow they have a strong handle on some of the most important aspects of their business- and when you can ' scorecard' your working capital situation and put solutions in place to accelerate cash inflows ( and decelerate cash outflow!) you are truly mastering your business when it comes to focusing on the true picture in your financial statements.
YOUR BUSINESS HAS A CASH OPERATING CYCLE
You can feel a lot less awkward about the challenge we’re talking about today by simply understanding your ' cash cycle ' and putting in finance solutions that match it. The cycle is managed and scorecarded simply by spending time in understanding how your purchase products, when you pay for them, what credit terms you offer, and how diligently you enforce those terms.
As you can see, it's all about ' timing ‘ Businesses go under in Canada in many situations because business is in fact great - in fact it's so great they run out of cash. That pipeline of funds is simply blocked as the investment you have made in inventory, accounts receivable and equipment intensifies.
BUSINESS CASH FLOW AND WORKING CAPITAL SOLUTIONS
What are then the solutions to our conundrum of working capital financing? They 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
Government Of Canada Small Business Loan Program - The Guaranteed federal business loan
PURCHASE ORDER FINANCING
SHORT TERM WORKING CAPITAL LOAN / MERCHANT ADVANCE
KEY TAKEAWAYS
Types of Working Capital Facilities: Understanding the different forms of working capital loans available, such as lines of credit, invoice financing, and short-term loans, provides a comprehensive view of the options a business can leverage.
Benefits of Working Capital Facility: Recognizing the advantages, such as improved cash flow management, operational continuity, and financial flexibility, offers a substantial understanding of why businesses should consider this financing.
Application Process: Grasping the steps involved in securing a working capital facility, from documentation to approval, is crucial for businesses to prepare effectively.
Eligibility Criteria: Knowing the requirements for qualification helps businesses evaluate their readiness and potential to secure financing.
Working Capital Facility vs. Business Loan: Distinguishing between working capital facilities and traditional business loans aids in making informed financial decisions based on the specific needs of the business.
CONCLUSION - UNDERSTANDING WORKING CAPITAL LOANS
Make sure you spot the roadblocks we have talked about in business growth and success. Address those red flags with one or several of the solutions.
Call 7 Park Avenue Financial, a trusted, credible and experienced Canadian business financing advisor who can assist you in feeling less ' awkward' about business cash flow!
FAQ: FREQUENTLY ASKED QUESTIONS / PEOPLE ALSO ASK / MORE INFORMATION
What is a working capital facility?
A working capital facility is a type of loan designed to help businesses manage their short-term financial needs, such as payroll, inventory, and operational expenses.
How does a working capital facility differ from a traditional business loan?
A working capital facility typically provides short-term financing to cover immediate needs, while traditional business loans often focus on long-term investments and larger projects.
What are the benefits of using a working capital facility?
Benefits include improved cash flow management, flexibility in meeting operational expenses, and the ability to take advantage of business opportunities without financial strain.
What is required to qualify for a working capital facility?
Eligibility criteria usually include a good credit score, ideally a solid business plan, financial statements, and proof of consistent revenue.
How can a working capital facility impact my business credit?
Timely repayment of a working capital facility can positively impact your business credit score, making it easier to secure future financing.
How do I apply for a working capital facility?
You can apply through financial institutions or online lenders by submitting the necessary documentation, including financial statements and a business plan.
What are the typical interest rates for working capital facilities?
Interest rates vary based on the lender, the amount borrowed, and the creditworthiness of the business.
How long does it take to get approved for a working capital facility?
Approval times can vary, but it typically takes between a few days to a couple of weeks, depending on the lender and the completeness of the application.
Are there any fees associated with a working capital facility?
Yes, fees can include origination fees, application fees, and monthly maintenance fees, depending on the lender's terms. Many small business owners rely on business credit cards as well - businesses pay interest on funds drawn down on the card
Can startups qualify for a working capital facility?
While it can be more challenging for startups to qualify due to a lack of established revenue, some lenders offer options specifically tailored for new businesses. A business owner's personal credit is also important for startup scenarios. Merchant cash advances are available to early-stage firms who aren't yet eligible for a revolving line of credit or a working capital line but still need to fund a company's everyday operations. Long term assets should be financed via term loans or lease financing solutions with long amortization son debt payments.
What types of working capital facilities are available?
Working capital facilities come in various forms, including lines of credit, invoice financing, trade credit, and short-term loans, each catering to different business needs.
How does invoice financing work within a working capital facility?
Facilities such as Invoice financing or a working capital loan allows businesses to borrow against their outstanding invoices, providing immediate cash flow while waiting for customers to pay.
What strategies can help manage working capital effectively?
Effective strategies include maintaining a cash flow forecast, optimizing inventory levels, negotiating favourable credit terms with suppliers, and ensuring the timely collection of receivables.
