OVERVIEW – Information on business financing alternatives in Canada . The right finance solution for Canadian business must match sales, assets, and overall financial viability
Business financing in Canada. It is easy sometimes for the business owner/financial manager to feel they are ‘ foraging ‘ for solutions. There’s probably no problem with that, although we’re highly recommending that you learn as you gather! Let’s dig in.
Given bank loans, government guaranteed loans, niche solutions offered by commercial finance companies, and all those equity solutions that dilute capital (angel/VC funding, crowdfunding, etc) what really is the right solution that is achievable for your business?
Those equity solutions (as opposed to debt and asset monetization) are really only suitable if your business can achieve hyper growth, market dominance, etc. Not for everyone.
Sometimes it’s also difficult for the owner/manager to decline a finance solution when in fact it might be the wrong one – that’s painful business financing and we see a lot of that when we talk to certain clients.
More often than not it’s a ‘ cash flow ‘ solution that is required. Those outflows simply aren’t matching the inflows! , and the degree of seriousness of that problem has taken many a business down.
The best cash flow and working capital solutions are those that fix temporary and intermediate problems. In many cases they are not the long term fix that that equity capital can provide – from owners or outsiders.
We’re the first to advise clients that working capital problems can be overcome by a lot of internal work, not necessarily requiring external financing solutions – that comes via selling more, generating higher profits , and focusing on asset mgmt and debt reduction .
What are though those external financial solutions to business financing, cash flow and working capital? They include:
Bank credit lines
Asset based lines of credit – full facilities or invoice or inventory finance separately or together
Tax credit monetization
Equipment financing/sale leasebacks
Tax Credit Finance bridge loans
The right financing solution can be identified, allowing a turnaround of sorts to commence.
There is a huge difference in the cost and access to financing that larger profitable companies have versus those struggling in the mid market SME Commercial sector in Canada. The reality is that smaller firms are ‘ credit scored ‘ in a fairly formulaic way – larger businesses get a bit more attention.
It’ critical to understand why your firm can’t get the financing you think it needs, but as important to know what the alternatives are. Seek out and speak to a trusted, credible and experienced Canadian business Financing Advisor with a track record of success
who can reverse that ‘ foraging ‘ feeling.
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 :
7 PARK AVENUE FINANCIAL = CANADIAN BUSINESS FINANCING EXPERTISE
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Canadian Business Financing