OVERVIEW – Information on business turnaround financing services and strategies. Knowing which options are available for turn around finance is your deal breaker in business survival and success.
Options in business turnaround financing services leave many clients we meet feeling as if they are business financing outsiders. Knowing they have to focus on some sort of ‘ financial recovery ‘ without knowing their sources of potential financial capital can leave owners/mgr’s in a very undesirable ‘ limbo’. We’re reviewing some financial options, techniques and go to strategies for the desired turn around. Let’s dig in.
Suffice to say that in business financing knowing the problem is a huge part of the solution. While the worst case scenario is going out of business the desired solution is financing that works.
Various types of finance sources exist, both traditional and alternative to help companies in times of need when there is an operating loss or current financial structure does not allow you to pay suppliers and lenders, much less grow.
While owner or new outside equity might sometimes me desired, or even mandated that type of capital is often hard as you’re turning around your business. One strategy explored by many is the possibility to merge your firm with another strategic partner or… dare we say it… competitor. In many cases declining sales and be assisted in ways such as cost cutting and operational efficiencies such as asset turnover.
Having solid cash flow projections and a realistic business plan is key to a solid turnaround strategy. That coupled with a solid understanding of current business assets and their value is the key to bouncing back financially. How you generate revenue is key in understanding potential turnaround financing solutions.
Financing solutions that properly address turnaround strategies include:
Unsecured cash flow loans
A/R Financing – Proper refinancing of sales receivables will always get you more cash
Asset based non – bank business lines of credit (loan advances for these credit lines are much more generous than traditional Canadian chartered bank alternatives
Sale leaseback strategies – In many case proper appraisals of fixed or current assets may well be required by external sources
Proper financing of your current assets (A/R / INVENTORIES) allows you turn inventories into receivables into cash in an ongoing cycle. ASSET TURNOVER IS KEY!
In many cases turnaround financing is a temporary fix – typical time frames are from 12-24 months; naturally business owners should be focusing on the long term plan also. Survive and then thrive might well be the mantra!
Outside collateral and personal guarantees of owners will almost always (unfortunately) be on the discussion table. Also, it’s important to note that cash flow also comes from effective payables mgmt., as well as limiting extended terms to your customers.
Some of the strategies mentioned above involve your ability to maximize asset turnover and recognize proper valuation of your assets. Simple strategies such as the ‘ sale lease back ‘ of asset you already own can bring in valuable capital to pay off or re-arrange debt.
In any turnaround strategy it’s important to address any government debt such as CRA arrears, HST, etc. New ‘ turnaround ‘ financing will often address this govt debt first because of the ‘ super priority’ the govt has on all businesses.
Once new financing is in place your focus should be on managing cash flow and balance sheet activity. Just the ability to properly forecast a realistic future cash flow need goes a long way in arranging new financing. While lenders always have a long term focus on ‘ getting out’ and getting paid the business owner/mgr’s skills in showing control and minimizing risk is key.
If you want to become an insider, as opposed to your current business financing outsider status seek out and speak to a trusted, credible and experienced Canadian business Financing Advisor with a track record of success who can assist you with business turnaround financing services / options.
7 Park Avenue Financial :
Business financing for Canadian Firms , specializing in working capital, cash flow, asset based financing , Equipment Leasing , franchise finance and Cdn. Tax Credit Finance . Founded 2004 – Completed in excess of 100 Million $ of financing for Canadian corporations . Info /Contact :
7 PARK AVENUE FINANCIAL = CANADIAN BUSINESS TURNAROUND FINANCING EXPERTISE
7 Park Avenue Financial
South Sheridan Executive Centre
2910 South Sheridan Way
Office = 905 829 2653
‘ Canadian Business Financing With The Intelligent Use Of Experience ‘
ABOUT THE AUTHOR
Stan has had a successful career with some of the world’s largest and most successful corporations.
Prior to founding 7 Park Avenue Financial in 2004 his employers over the last 25 years were, ASHLAND OIL, ( 1977-1980) DIGITAL EQUIPMENT CORPORATION, ( 1980-1990) ) CABLE & WIRELESS PLC,( 1991 -1993) ) AND HEWLETT PACKARD ( 1994-2004 ) He is an expert in Canadian Business Financing.
Stan has over 40 years of business and finance executive experience. He has been recognized as a credit/financial executive for three of the largest technology companies in the world; Hewlett-Packard, Digital Equipment and Cable & Wireless. Stan has had in depth, hands on experience in assessing and evaluating thousands of companies that are seeking financing and expansion. He has been instrumental in helping many companies progress through every phase of financing, mergers & acquisitions, sales and marketing and human resources. Stan has worked with startups and public corporations and has many times established the financial wherewithal of organizations before approving millions of dollars of financing facilities and instruments on behalf of his employers.