YOUR COMPANY IS LOOKING FOR BUSINESS FINANCE SOLUTIONS!
You've arrived at the right address! Welcome to 7 Park Avenue Financial
Financing & Cash flow are the biggest issues facing business today
ARE YOU UNAWARE OR DISSATISFIED WITH YOUR CURRENT BUSINESS FINANCING OPTIONS?
CONTACT:
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
"Stop letting rejected bank applications hold your business hostage. There's a better way to fuel your growth."
7 Park Avenue Financial originates business financing solutions for Canadian Businesses – We offer Canadian Business Financing and working capital solutions – Save time, and focus on profits and business opportunities
7 Park Avenue Financial: “Canadian Business Financing with the intelligent use of experience”
Business Loan Finance Company: Key Strategies for Success
Understanding Business Finance Needs
Business finance strategies require serious investigation and consideration of any company’s asset funding and loan needs.
Every company is at a different stage of growth or success, requiring different solutions. Affordable financing can be a crucial option for business owners, particularly those from underserved communities, as it enables access to funding that supports growth or startup initiatives.
Lack of or improper solutions lead to what we’ve called that ‘terminal event’… business failure. Let’s dig in.
WHEN TRADITIONAL FINANCING FAILS - CONSIDER ALTERNATIVE BUSINESS GROWTH SOLUTIONS
Canadian businesses frequently hit roadblocks with conventional bank financing, leaving growth opportunities out of reach.
The frustration of rejected applications and rigid requirements can paralyze your business plans. Let the 7 Park Avenue Financial team offer a refreshing alternative, providing tailored financing solutions with faster approvals and more flexible terms.
Did You Know?
- 45% of Canadian small businesses seek alternative financing options
- Alternative lenders process applications 60% faster than traditional banks
- 72% of businesses prefer flexible repayment terms
- 83% of approved applicants receive funding within five business days
- Market size growing at 16% annually
The Role of Cash Flow in Business Success
While working capital needs often measure business success because they typically reflect sales growth and ‘paper profits,’ cash flow is always the ultimate measure of success… and survival.
The Importance of Cash Reserves and Forecasting
While the optimal goal is to have some ‘cash reserve’ or access to that cash via a business line of credit, those two goals are not always attainable. It’s important to note that some simple cash flow forecasting can almost always help identify future cash and financing needs bulges.
Industry-Specific Financing Needs
The problem is that many industries require different capital expenditure and working capital investment levels.
Service Companies vs. Manufacturers
The winners in this category are ‘service companies’ who require much less spending to attain sales revenues. This is opposed to manufacturers who invest in equipment and inventory and have a longer cash cycle.
Financing for Research and Development
Sometimes, your firm might be investing in R&D, which forces an even longer business cycle. When we meet clients facing R&D capital needs, we encourage them to take advantage of Canada’s SR&ED program, which allows you to recover a large portion of your research spend.
By the way, those refundable tax credits are financeable and allow you to accelerate that cash outflow into your bank account aggressively!
Avoiding Equity Dilution in Financing
When financing becomes a key consideration, many owners don’t want to look to new equity, thereby ‘diluting’ their ownership.
Managing Receivables and Credit
Unfortunately, companies that don’t focus on managing their receivables and credit will find themselves in dire straits, which can lead to our ‘terminal event.’
Alternatives to Bank Lines of Credit
If bank lines aren’t available, owners/financial managers should consider A/R financing or an Asset-based non-bank business line of credit.
These types of facilities allow you to draw against ongoing sales and receivables. They don’t work when your sales are in a death spiral or if you’re not focusing on good collection turnover.
Sources of New Cash for Businesses
Remember also that new cash coming into your firm will only come from a handful of resources, namely collecting your sales receivables, borrowing, and efficient use of supplier credit.
Filling the Cash Gap
The ‘cash gap’ can be filled by debt, equity, or monetizing existing assets via funding sources such as A/R finance, equipment leases and loans, asset sale-leaseback, working capital term loans, or exploring the possibility of unsecured cash flow loans.
Understanding Business Loans
Business loans are vital financing tools that allow small businesses to access the capital needed for various purposes, such as funding operations, expanding, or covering other business-related expenses.
These loans can be obtained from various financial institutions, including banks, credit unions, and alternative lenders.
For small business owners, understanding the different types of business loans and their specific requirements is crucial to making informed decisions about their financing options.
By familiarizing themselves with the available loan products, small businesses can better navigate the complexities of business financing and choose the solutions that best meet their needs.
Types of Business Loans
Small businesses have access to several types of business loans, each designed to meet different financial needs:
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Term Loans: These loans provide a lump sum of money that must be repaid over a fixed period, usually with a fixed interest rate. This small business loan is ideal for significant investments or long-term projects.
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Lines of Credit: Offering a revolving credit limit, lines of credit allow businesses to draw funds as needed, with interest charged only on the outstanding balance. This flexibility makes them suitable for managing cash flow fluctuations.
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Merchant Cash Advances provide a lump sum in exchange for a percentage of future credit card sales. They offer quick access to capital but often at higher costs for more urgent small business funding
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Collateral Loans: Canadian small business loans are often Secured by assets such as equipment or property. These loans offer lower interest rates but require valuable collateral.
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Government Small Business Loans: Guaranteed by the government, SBL loans offer favourable terms, including lower interest rates and longer repayment periods, making them an attractive option for many small businesses.
Understanding these options helps small businesses choose the right type of loan to support their specific financial needs and growth plans.
Eligibility and Requirements
To qualify for a business loan, small businesses in Ontario generally need to meet certain criteria:
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Minimum Credit Score: Lenders typically require a minimum credit score to assess the business’s creditworthiness.
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Time in Business: A certain amount of operational history is often necessary to demonstrate stability.
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Annual Revenue: Lenders may require a minimum annual revenue to ensure the business can repay the loan.
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Solid Business Plan: A well-structured business plan can significantly enhance the chances of approval.
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Collateral: Some loans may require collateral to secure the financing.
Additionally, lenders often request financial statements, such as balance sheets and income statements, along with bank statements and tax returns.
Funding Options
Small businesses in Ontario have several funding options to consider:
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Traditional Banks: Traditional banks offer a range of business loan products, including term loans and lines of credit, and are a common choice for many businesses.
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Alternative Lenders: These lenders provide more flexible loan options, such as merchant cash advances and collateral loans, often with quicker approval processes.
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Government Programs: Programs like the Canada Small Business Financing Loan (CSBFL) support small businesses with favourable terms and conditions.
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Online Lenders: Known for their quick and easy access to capital, online lenders often offer more flexible terms than traditional banks.
Exploring these various funding sources can help small businesses find the most suitable financing solutions to meet their unique needs.
Application and Approval Process
The application and approval process for business loans generally involves several key steps:
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Pre-approval: The lender reviews the business’s creditworthiness and provides a pre-approval for a certain amount of funding.
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Application: The business submits a formal application, including financial statements and other required documents.
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Review: The lender carefully reviews the application and assesses the business’s financial health and repayment ability.
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Approval: Upon approval, the lender disburses the funds to the business.
Understanding these steps and preparing the necessary documentation can help small businesses navigate the loan process more efficiently.
Choosing a Lender
When selecting a lender, small businesses in Ontario should consider several factors:
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Interest Rates: Look for lenders that offer competitive interest rates to minimize borrowing costs.
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Fees: Be aware of any associated fees, such as origination fees and late payment fees, which can impact the overall cost of the loan.
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Repayment Terms: Choose a lender that offers flexible repayment terms, whether it’s a line of credit or a term loan with a long repayment period. A business loan calculator can help to identify payments, amortization, etc.
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Customer Service: Consider the lender’s reputation for customer service and their availability to address any concerns.
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Reviews: Reading reviews from other small business owners can provide valuable insights into the lender’s reliability and service quality.
By carefully evaluating these factors, small businesses can make informed decisions and select the best lender to support their financial needs and growth objectives.
Key Takeaway
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Credit requirements determine loan approval fundamentals across most financing options.
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Revenue-based lending focuses on business performance rather than traditional metrics.
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Collateral requirements vary significantly between different financing products.
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Interest rates reflect risk levels, and lending terms fundamentally
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Alternative lenders provide faster approvals compared to traditional institutions
Conclusion
Focused on ‘avoiding’ our terminal event through proper financing solutions and techniques?
Don't let financing slow your success.
Call 7 Park Avenue Financial, a trusted, credible, and experienced Canadian business financing advisor who can assist you in ‘up and running’ cash flow and business finance.
FAQ
What makes business loan finance companies different from traditional banks?
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Faster approval processes
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More flexible qualification criteria
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Customized lending solutions
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Simplified application procedures
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Industry-specific expertise
How can alternative financing help my business grow?
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Immediate access to working capital
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Ability to seize time-sensitive opportunities
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Scalable funding solutions
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Support for seasonal fluctuations
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Protection of personal assets
What types of businesses benefit most from these financing solutions?
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Retail operations needing inventory
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Service companies with equipment needs
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Seasonal businesses
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High-growth startups
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Companies with large accounts receivable
What security requirements are typically needed?
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Various options available from unsecured to fully secured
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Personal guarantees may be required
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Asset-based options available
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Revenue-based alternatives exist
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Flexible collateral arrangements possible
How does the repayment structure work?
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Daily, weekly, or monthly options
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Revenue-based repayment plans
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Fixed or variable terms
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Early repayment options
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Customizable payment schedules
How do business loan finance companies evaluate applications?
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Business revenue analysis
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Credit score consideration
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Time in business assessment
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Industry risk evaluation
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Cash flow patterns review
What documentation streamlines the approval process?
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Bank statements
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Tax returns
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Financial statements
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Business licenses
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Revenue projections
What makes an ideal candidate for alternative financing?
