What Types Of Canadian Business Financing Require A Business Plan Financing Businesses In Canada

OVERVIEW – Information on how Canadian business owners can determine the need for a proper business plan proposal for finance requirements . Financing businesses in Canada ( sometimes ) requires a proper busines splan proposal

Financing businesses in Canada may, or may not, require a business plan proposal. When do business plans make or break your firms financing objectives, and are they required at all? What are the risks of not having a plan when you need one? Let’s dig in.

Business owners and financial managers typically associate business plans with funding requests. Done properly the document reflects the type and amount of funding you need (for example – capital expenditures / buying a business, etc) potential future financing needs, and what banks and other lenders (commercial finance companies, etc) call the ‘ use of proceeds’.

Additionally a proper document such as that will include how the loan or financing needs fit into your businesses overall working capital and cash flow needs. It sometimes is forgotten that the lender is fixated on one thing – getting repaid!

While many plans we see focus on the past and present it’s always critical to integrate your financing into the future – re-iterating how debt will be repaid, etc. Time periods for repayment are important also, as you want to be able to demonstrate things like timing of cash flows, cyclicality in your business, temporary ‘ bulges ‘ of sales and cash flow.

A sense of urgency is not the best theme to have in your business plans. That’s when the ability to properly anticipate future financing needs helps your proposal stand our as more legitimate. Financing under pressure almost never works – dire straits financing is certainly achievable – but not recommended as a strategy!

Start up business financing almost always requires a proper business plan. Here capital and funding is typically more costly as it’s associated with more ‘ risk ‘ – so your ability to have a clear sound business plan reflecting realistic potential success is desired. Certain industries are occasionally out of favor – if that’s the case even more care is needed.

Here’s a quick recap of some of the main types of Canadian business finance solutions – highlighting a more clear need for when you might best consider the need for a business plan

A/R Financing – not required

Inventory Financing – not required

Govt SBL Loans – required/recommended

Term loans – Recommended

Acquisition Financing – Required/recommended

SR&ED & Film Tax Credit Financing – not required

Franchise Financing – Required and recommended

Working capital term loans – Recommended

The cost and time in preparing a business plan that reflects your funding needs is more reasonable than most owners imagine. Seek out and speak to a trusted, credible and experienced Canadian business financing advisor who can ensure your plan is cost effective and works.

The business owner/ financial manager should always be on the lookout for those ‘warning signs’ that a good business plan proposal is required – one that reflects that your company merits and deserves the financing it needs to start /operate/grow or acquire a business.

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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