Made To Measure A/R Financing – Eliminating Off The Rack Solutions In Receivable Finance Receivables Finance
Information on different receivables finance solutions in Canada. AR Business Factoring companies , when used properly, maximize cash flow and enhance growth prospects

Receivables finance in Canada, we think, suggests the analogy of ‘ made to measure ‘ versus ‘ off the rack’ when it comes to the short to intermediate term solutions offered by business factoring companies . And the type of solution you choose will be directly related to the benefits. Let’s dig in.

Business owners and financial managers very early on realize the importance of access to short term financing for day to day operations and the ability to grow a business. Business cycles in their industry or specifically in their company often force the owner/manager to address shortages of cash. A solution is therefore required – if it’s not a Canadian chartered bank offering then business factoring companies step in to take up that slack

But what are the types, costs and advantages of this method of Canadian business financing? The type of financing you ultimately source needs to deliver on liquidity. The right offering will also allow you to grow your business without always having to consider more ‘ equity ‘ or ‘ long term debt ‘, which dilute ownership or can bring balance sheet risk respectively.

Receivable financing as a cash flow and working capital solutions is sometimes neglected by Canadian businesses if only for the reason that owners don’t know it existed or how it works.

Almost all of the receivable financing that is currently taking place in Canada originated , style wise, in the U.S. and even back to Europe, It was a natural way to fill the gap between delivering products and services and waiting to get paid .

When you weigh a business factoring A/R solution it’s a classic case of cost versus benefits. While A/R finance is almost always more expensive it delivers on significant benefits, not the least of which is providing a method for unlimited growth as it relates to ‘ market power ‘ of your company.

One reason big corporations get bigger is their ability to demand more time to pay clients, and businesses in the SME sector that might be your clients desperately need trade credit from your company to address their own financial issues. Top experts tell us that A/R receivable financing volumes actually shrunk just after the 2008-2009 world wide credit crunch simply because many businesses stopped growing – i.e. A/R declined.

Canadian banks offer revolving credit facilities based on their terms, so the same cash flow and access to working capital we’re talking about comes with the demand of bank credit criteria – those solid balance sheets, profit generation, and collateral and ratio requirements.

Business factoring companies step in with various solutions. Traditionally the only offering available had business factors assuming management and control of your sales invoices, including direct contact with clients.

Our recommend alternative to business owners/managers is CONFIDENTIAL RECEIVABLE FINANCING, allowing a company to reap all the benefits of A/R finance, but being in total control of sales, invoices and collections. Larger corporations can take advantage of securitization, offering the same benefits.

Businesses in Canada can reduce the costs of A/R financing by always coming back to the fundamentals: good credit management, timely invoicing, good follow up, and drawing down on bank lines of credit or business factoring facilities only when they need to.

If you’re looking for a ‘ made to measure ‘ solution in Accounts Receivable cash flow finance , and want to find out what you might be missing in a business cash flow solution seek out and speak to a trusted, credible and experienced Canadian business Financing Advisor with a track record of success .

Author: Stan Prokop – founder of 7 Park Avenue Financial

Originating business financing for Canadian companies, specializing in working capital, cash flow, and asset based financing. In business 10 years – has completed in excess of $90 Million of financing for Canadian corporations. Core competencies include receivables financing, asset based lending, working capital, equipment finance, franchise finance and tax credit financing.
Info re: Canadian business financing & contact details:


Greg LaBella
7 Park Avenue Financial
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Cell   905 302 4171


7 Park Avenue Financial
Canadian Business Financing