OVERVIEW – Information on business financing and loans in Canada. Masterminding the term loan / working capital finance solution
Business financing almost always involves taking on debt – most owners and financial mgrs are somewhat reluctant to take on forms of finance that don’t necessarily help to build the wealth and equity in their business.
But both business loans and working capital finance, done properly, allow a business to handle growth and profits in a manner that reaches their business goals. Let’s dig in.
Remember also that often business credit lines and other asset monetization techniques (examples: sale leasebacks / tax credit financing, non bank credit lines) bring new capital and cash to your business but don’t necessarily add debt to the balance sheet. These techniques balance themselves based on assets you already own or generate.
In some cases owners must rationalize the fact that they ultimately do in fact need some new permanent working capital or owner equity in the business. One way to measure the need for permanent equity/working capital needs is to simply assess your business credit line fluctuations.
If credit lines are constantly being used to the max there is a suggestion to both you as owners, as well as any other lenders you have, that the inability to meet debt obligations or cash flow needs could be just around the corner.
The whole issue of credit lines versus ‘ term ‘ borrowing is critical to the business owner/mgr. That’s because it’s important to match business needs with the right type of debt.
Longer term fixed assets, i.e. plant equipment, technology needs, etc, should be financing via Equipment financing or term loans. Here a lease versus buy analysis prepared by your accountant or equipment lessor should help you make the right decision. A key caveat here is that you should always be comfortable that your sales and profits and cash flows will be in a position to retire leases or loans your business takes on.
Businesses who are considering taking on loans are often driven by their inability to collect receivables or address inventory needs. These situations truly are fixed by proper revolving credit lines being in place .For companies that can’t access bank credit ABL (asset based lending) facilities are the perfect solution. That funding of receivables and inventory helps the ‘ disruption that your slow paying clients have caused!
There’s no question that the true ‘ magic’ in business success if strong sales, profits, and little or no debt. But properly managed loan and working capital solutions play a key role in long term business survival. If you’re looking to fill the void in your cash and capital needs seek out and speak to a trusted, credible and experienced Canadian business financing advisor who can help you mastermind right solutions based on your company/industry needs.
Stan Prokop – founder of 7 Park Avenue Financial –
Originating business financing for Canadian companies , specializing in working capital, cash flow, asset based financing . In business 10 years – Completed in excess of 100 Million $$ of financing for Canadian corporations . Core competancies include receivables financing, asset based lending, working capital, equipment finance, franchise finance and tax credit financing.
Info & Contact Details :
7 PARK AVENUE FINANCIAL = CANADIAN BUSINESS 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.
7 Park Avenue Financial
Canadian Business Financing