Is Your Company In A Constant Whirligig On Business Cash Flow & Working Capital Funding Challenges ?

Canadian Cash Flow and Working Capital Solutions


Information on business cash flow and funding working capital in Canada. Measuring the problem and address it via real world solutions .



Boy do we love a good term when we see one. Whirligig. It’s the definition for a ‘ whirling or circling course of events ‘. Don’t business owners often feel they are in a constant whirligig of business cash flow challenges – always looking for funding for working capital as their business grows? They certainly are always telling us that.

Let’s examine some ways to both measure and address working capital and cash flow shortages. Our primary focus is on the SME (small to medium enterprise) sector of business in Canada. We should note that larger corporations have access to more sophisticated working capital solutions that include unsecured cash flow loans and mezzanine debt provide by Chartered banks, private equity firms, and specialized commercial financing companies in Canada .There are even some hedge funds in Canada offering this type of working capital solution.

The cash flow lending offered by these firms to larger companies is based on multiples of cash flow and profits, not utilizing the actual assets of the firm as first position secured collateral. Suffice to say that interest rates on these types of loans are very attractive but at the same time come with rigorous credit and size criteria that of course SME sector firms simply can’t meet.

SME firms are focused on more mundane issues, reducing their payables, purchasing more inventories, and meeting employee obligations. When actual working capital runs low of course our whirligig kicks in! It’s the constant battle to replenish working capital.

Working capital for your business consists of your cash on hand, your borrowing ability, and of course receivables and inventory.

The rudimentary way that those textbook guys and accountants calculate working capital is to divide current assets by current liabilities on your balance sheet .We’ve never really like this calculation because it doesn’t truly reflect the flow of funds in an out of your business . (A calculation called the operating cash flow calc does this much better). For instance if your sales are flat or slowing down and your receivables and inventory are building up your working capital current ratio calc is higher, but the reality is that your real cash flow is getting worse . And that’s a problem.

Working capital solutions in Canada are available but they are somewhat more limited in nature than many Canadian business owners and financial managers think. Business lines of credit to cover business cash flow for start ups or small businesses rely heavily on the business owners personal assets. Canada’s crown bank corporation offers working capital term loans, but significant emphasis is placed on owner equity and cash flow ratios.

The real world solutions available in Canada in 2011 for funding business cash flow are as follows; sale leaseback of some of your assets, Chartered bank lines of credit, accounts receivable financing facilities, non bank asset based lending facilities (they combine your A/R and inventory and equipment into one business line of credit). Many Canadian firms utilize various tax credits which can also be monetized into cash flow and working capital liquidity.

Speak to a trusted, experienced, and credible Canadian business financing advisor on how you can avoid the whirligig of Canadian business cash flow. In today’s competitive environment you ability to survive is based strongly on ensuring your working capital life blood is healthy.



Stan Prokop – founder of 7 Park Avenue Financial -


http://www.7parkavenuefinancial.com


Originating business financing for Canadian companies , specializing in working capital, cash flow, asset based financing . In business 7 years – has completed in excess of 80 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 re: Canadian business financing & contact details :


http://www.7parkavenuefinancial.com/business_cash_flow_funding_working_capital.html

We’re Sharing the biggest Secret in business funding today and why factoring of accounts receivables isn’t what you thought!

It's kind of not a secret if everyone knows it right? but we’re pretty sure when it comes to business funding that the factoring of accounts receivables on a confidential basis is one of the most powerful alternative Canadian business financing strategies that is a secret that only limited Canadian business owners and financial managers know about .

Let’s put this ' secret ' in the context of some real world examples that might closely resemble your firm’s situation and needs.

Working capital challenges. You have them, and they seem to pre occupy a lot, and we mean a lot of your business day. So how do those restraints on liquidity affect your firm... they manifest themselves in payroll challeges, meeting lease and loan payments, and that worst feeling of all, not being able to grow your business or take on that new customer because of cash flow challenges.

In many cases, and you are certainly not alone, you're just coming out of the recession and collections from customers is still difficult, and expense restraints seem the order of the day. If you're like many other firms there is some seasonality to your business and you occasionally have bulge needs for cash and working capital.

So... we have done a great job of giving you the problem, which you knew already! Let’s turn that around and give you the solution.

Accounts receivable financing and business funding, commonly known is factoring of accounts receivables, is the potential solution. But we can hear you already... you have heard about it and you dont like how this solution works and the perceptions some suppliers and customers might have around how you are financing your business.

Well, it gets better, because we have a solution to that problem and it’s called confidential factoring of accounts receivables. Under this type of financing you are in a position of selling your receivables as you generate them, at your option of course, and, here’s the kicker, you receive cash for those invoices the same day - while at the same time retaining the right to bill and collect your own accounts. That ability to bill and collect your accounts receivable financing process just turned you into a confidential cash flow machine, allowing you to meet day to day obligations and, as we said, grow your business.

The whole process is seamless and it takes only a week or so to set it up. This type of financing appeals to two typical small and medium sized firms (by the way, Canada's biggest corporations use it also!). It appeals to firms who don’t have access to bank credit, or more commonly, might qualify for some level of bank financing, but not enough. That is because, unlike the Canadian banks business funding in Canada via factoring focuses solely on the strength and size of your receivables. In some cases, are you ready for this..? Inventory can be combined into the same facility.

There it is then... a great secret and business financing strategy that will allow you to finance your business. Speak to a trusted, credible, and experienced business Canadian business financing advisor who can assist you in completing this finance strategy.
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Stan Prokop - founder of 7 Park Avenue Financial -

http://www.7parkavenuefinancial.com

Originating business financing for Canadian companies , specializing in working capital, cash flow, asset based financing . In business 6 years - has completed in excess of 50 Million $$ of financing for Canadian corporations .Info re: Canadian business financing & contact details :

http://www.7parkavenuefinancial.com/business_funding_factoring_of_accounts_receivables.html