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Financing & Cash flow are the biggest issues facing business today
ARE YOU UNAWARE OR DISSATISFIED WITH YOUR CURRENT BUSINESS FINANCING OPTIONS?
CALL NOW - DIRECT LINE - 416 319 5769 - Let's talk or arrange a meeting to discuss your needs
EMAIL - INFO@7parkavenuefinancial.com
7 Park Avenue Financial
South Sheridan Executive Centre
2910 South Sheridan Way
Suite 301
Oakville, Ontario
L6J 7J8
Direct Line = 416 319 5769
Email = sprokop@7parkavenuefinancial.com
Account receivable funding in Canada conjures up the 'Mind the Gap' expression for us today. That's, of course, the out-loud warning that subway passengers hear when they board train doors. However in our case we’re always cautioning our clients to mind the gap when it comes to receivables lending. Let's dig in.
That ' gap ' is of course when business owners in the SME (small to medium enterprise) sector in Canada find themselves cash flow poor / challenged while waiting for client receivables to come in. Since A/R and inventory represent your most liquid current assets (next to cash) your ability to 'move ‘(i.e. manage) or finance those assets is key to the survival of your business.
Non bank A/R Finance is the quickest way to working capital success when traditional bank finance doesn't work for your business. For Canadian companies that can't afford to lose sales opportunities or the inability to meet their other operating and loan obligations. The total win/win for this type of financing is when it is receivables lending shortens that gap given that sales are immediately converted to cash. When businesses can't access traditional capital and they don't want to give up expensive equity A/R funding is one solid solution. And the good news about ' limits'? There are none, as basically unlimited financing is available for any business that has the sales revenues/receivables to match.
This type of lending is often short-term in nature, as most clients tend to work their way back to what they consider ' traditional' finance that comes with lower costs/rates. Remember, there is no 'debt ' on your balance sheet when AR finance is employed - it’s an asset monetization strategy. During this period of utilizing receivables finance, your supplier relationships improve, and your general credit profile is enhanced given your new liquidity .
The immediate benefit of a combination of A/R financing combined with good management provides a double whammy of business financing success. How, for example? Consider a firm that finances AR, receives cash immediately on making a sale, and uses that cash to take supplier discounts or achieve better pricing on service and products they purchase. They have effectively ' minded the gap'! Although most companies out there can't achieve ' negative cash gap ' (receive full payment before they pay suppliers), those that can effectively finance the gap and manage assets are... winners.
If there is one thing clients tell us they ' hate' about commercial a/r financing and factoring solutions it's the oft requirement to have their customers 'notified' of the entire financing process. Looking for some good news on that one? We recommend CONFIDENTIAL A/R FINANCING that allows you to achieve all the benefits of receivables lending while at the same time billing and collecting your own accounts.
If you're looking for a total ' redesign' in finance thinking for your business, seek out and speak to a trusted, credible and experienced Canadian business financing advisor who can assist you with your receivables lending needs.
Stan Prokop
