Your Business Cash Flow Financing Nightmare Is Probably Not Just In Your Head

OVERVIEW – Information on business cash flow loans and asset monetization strategies for Canadian businesses. Working capital needs can be fulfilled in a variety of manners – here’s why and how


Working capital
shortages can almost always be reversed with the right asset monetization or business cash flow loans. It’s no secret that challenge can easily become a nightmare when not identified and properly addressed in a timely manner. Let’s dig in.

Critical to implementing the right solution is the understanding of some key basics – they include:

Understanding your ‘ cash flow cycle’

Halting and managing cash outflows

Being able to accelerate cash receipts via proper credit and collection policies

Your company can improve overall business health with proper cash flow management and external and internal financing. We’ve mentioned above that ‘ cash flow cycle ‘. It’s simply the ability to understand how a dollar flows through your company and how long it spends in inventory, A/R, etc.

But what solutions are in fact available to halt the oncoming of a cash flow crisis. They typically include:

Bank lines of credit

Asset based non bank lines of credit (Known as ‘ ABL ‘ they are the alternative to Canadian chartered bank facilities

A/R financing (this comes in a variety of shapes and sizes)

Inventory finance

Working capital term loans (permanent injections of working capital)

Purchase order/Contract financing

Tax Credit Financing (SR&ED Tax credits)

These are the external financing solutions available to any firm that wants or needs to address avoiding a cash flow crisis. Internally though owners and financial managers can better monitor and accelerate cash via constantly assessing days sales outstanding, inventory turns, and payables days outstanding. Oh and don’t forget expense mgmt!

A simple cash flow forecast can easily anticipate upcoming working capital and cash shortages. A simple trick – Constantly monitor the relationship between A/R and sales on a monthly basis, in the form of a ‘ ratio’. If that ratio is greater than one? Danger ahead! Simply speaking cash flow problems are upcoming as you are running out of cash.

Your company is either eligible for bank financing or it is not. Bank finance solutions in Canada are low cost, and flexible. In some cases your company might be eligible, but not in the amounts needed.

Short term shortages must be addressed by short term financing strategies, typically lines of credit, A/R financing, and inventory finance. Many businesses of a small to medium size are considering A/R finance these days. This tool turns everyday sales into everyday cash. Our recommendation is to consider CONFIDENTIAL RECEIVABLE FINANCING. While more expensive than bank lines it provides unlimited financing and allows you to bill and collect your A/R in a matter similar to bank credit facilities.

If you want to avoid the cash flow nightmare via proper business cash flow loans and asset monetization strategies seek out and speak to a trusted, credible and experienced Canadian business financing advisor who can assist you with your working capital needs.

Author: Stan Prokop
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 90 Million $ of financing for Canadian corporations . Info /Contact :


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Canadian Business Financing