Business Cash Flow Financing Problems Solutions | 7 Park Avenue Financial

 

 

YOUR COMPANY IS LOOKING FOR BUSINESS CASH FLOW FINANCING!

SOLVING CASH FLOW ISSUES IN YOUR BUSINESS

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Financing & Cash flow are the biggest issues facing businesses today

ARE YOU UNAWARE OR DISSATISFIED WITH YOUR CURRENT  BUSINESS FINANCING OPTIONS?

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BUSINESS CASH FLOW FINANCING

 

Cash flow loan solutions can be used for a variety of reasons:

 

Working capital type financing can be used to finance growth, as well as allow a business to invest in sales and marketing and can be used as a fix to fund cash flow shortfalls when business line of credit extensions may not be feasible.

 

Nothing is as entertaining to us sometimes as talking to a new entrepreneur who aspires to 'get rich in business. It's at that time that things just don't seem that complex; a firm just needs to make a product, sell it, and bank the profits. And when you think of it, that's not incorrect, it just exhibits a bit of inexperience in the perception of that simplicity, don't you think?

 

 

CASH FLOW LOANS FOR SMALL  BUSINESSES - CONSIDER CASH FLOW FINANCING  WHEN YOUR BUSINESS NEEDS CAPITAL

 

The only thing that is missing in that analysis is of course those three magic words, the 'cash flow cycle' for small businesses.  It's that cycle that will dictate whether your business cash flow financing problems are normal, or perhaps seriously in need of solutions.

 

CASH FLOW LOANS VERSUS ASSET-BACKED LOANS

 

Asset finance is primarily used to provide a means for businesses to get financing. A cash flow loan is provided with cash flows acting as collateral to the loans.  In cash-flow finance, cash generated can be used to secure loans. Collateral does not exist on tangible property in cash flow lending.

 

 

  

 HOW MUCH CASH DOES A BUSINESS NEED?   

 

The small business owners will often mistakenly think that negative cash flows, those huge swings from positive to the negative are in fact a sign of failure when cash generated is not sufficient. That's the farthest from the truth. It simply means you're 'in line‘. In line? To get paid of course!

 

But the preparations you make when you are ' in line ' are what will truly make or break your business.  Simply speaking you need cash flow financing solutions to cover those deficits. It is at those times that your firm is most vulnerable - because employees, suppliers, and lenders, (what a group!) may in fact doubt your ability to return to positive cash flow.

 

Canadian business owners turn to chartered banks to cover that deficit when they can.  The bank is in a position, when you qualify, to provide you with a business line of credit that will allow your cash flow cycle to continually repeat itself, from negative, to positive, and all over again.

 

STRUGGLING FOR CASH FLOW?  STRATEGIES FOR SURVIVAL

 

But what if the bank is an inaccessible option for cash flow finance solutions?  In some cases, we have seen business owners solve their working capital problems by simply accessing supplier credit in a more aggressive manner. It’s not always immediately obvious to business owners that slowing down payables increase your operating cash flow. Of course, it's a delicate balance though.

 

Another issue in working capital and cash flow financing challenges can be the seasonality of your business. Many businesses have very uneven profit earnings; for example, they might break even or sustain financial losses during some parts of the year, and thrive in others.

 

When business in fact seasonal, experiencing the ' bulge ' as we might call it your bank or other lenders have the option of staying the course with your firm, or cancelling credit facilities altogether.

 

We have shown that cash flow challenges are a business reality, spanning all types of businesses and different industries.  With proper management and solutions, those challenges can be overcome. It always gets back to the issue of cash flow and profits being recognized as different. The bottom line, your profits are on paper only until they are banked.

In Canada, business owners have access to a number of business finance solutions via a small business loan solution for working capital and cash flow. They include

 

Traditional banking 

Asset based lending

Receivables finance / Invoice Financing- a  popular method of financing money owed to your business

Inventory finance

PO finance

Tax credit monetization - Financing SR&ED Tax Credits

Short Term Working Capital Loans / Merchant Cash Advances

 

  

CONCLUSION - CASH FLOW BASED LENDING SOLUTIONS 

 

 

Cash flow management and financing can make a significant investment in your business. If we understand cash flows then we can advance the game.  Understanding the costs of employee overtime, replacements for equipment and other items is crucial for business success.

 

Speak to 7 Park Avenue Financial, a trusted, credible and experienced Canadian business financing advisor who will ensure your business hasn't lost faith in its ability to come up with growth and business capital solutions for success for small business owners in Canada

 

 

  

FAQ: FREQUENTLY ASKED QUESTIONS / PEOPLE ALSO ASK / MORE INFORMATION  

 

What is a cash flow loan?

A cash flow loan is a type of loan that doesn't require any business or personal assets as collateral. Lenders grant financing based on a company's expected cash flows based on historical and forecasted sales revenues - Terms can be of a short-term nature or in some cases extend to 5 years based on strong future cash flow.

Cash flow loans are a great option for businesses and entrepreneurs with healthy cash flows. - it's all about cash flow predictability. Generated cash flow is the loan collateral.

  

What is cash flow in business finance? 

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