YOUR COMPANY IS LOOKING FOR BUSINESS CREDIT LINE 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?
CALL NOW - DIRECT LINE - 416 319 5769 - Let's talk or arrange a meeting to discuss your needs
EMAIL - sprokop@7parkavenuefinancial.com
7 Park Avenue Financial
South Sheridan Executive Centre
2910 South Sheridan Way
Oakville, Ontario
L6J 7J8
"Stop letting cash flow gaps hold your business hostage - discover how a business credit line can transform your financial flexibility."
7 Park Avenue Financial originates business financing solutions for Canadian Businesses – We offer Business Credit Line 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”
TRANSFORM YOUR CASH FLOW - BUSINESS CREDIT LINES MADE SIMPLE
Business credit lines in Canada often have business owners and financial managers feeling 'QUESTIONINGLY.’
We're told that using that term leaves issues 'open to controversy' and demands information and clarification.
Which type (only 2!) of facility works for you, and are you eligible for one or both in your firm? Let's dig in on this valuable business finance tool!
BREAKING FREE FROM CASH FLOW CONSTRAINT - YOUR BUSINESS CREDIT LINE SOLUTION
Growing businesses face unpredictable cash flow cycles that can strangle growth and limit opportunities.
Without adequate working capital, you risk missing supplier discounts, turning down large orders, or struggling with seasonal fluctuations.
Let the 7 Park Avenue Financial team show you how a business credit line can provide the flexible funding solution you need. They offer immediate access to capital while maintaining control over your borrowing costs.
Two Uncommon Takes on the Business Credit Line
- Business credit line solutions can improve vendor relationships by enabling early payment discounts, creating a positive feedback loop for your business's financial health.
- Using business credit lines strategically during slow seasons can help maintain optimal inventory levels, potentially increasing your market share when competitors are understocked.
Did You Know?
- 68% of Canadian SMEs rely on credit lines for working capital
- The average business credit line utilization rate is 40%
- 73% of businesses with credit lines report improved cash flow
- Credit line approval rates increased by 15% in 2023
A business credit line is a revolving facility allowing companies to access cash flow to fund short-term business needs.
Not a lump sum loan, a business draws on facilities as it requires funds, paying only the amount drawn down as it funds operating expenses, business purchases, and business expenses.
Traditional credit lines often have a limit based on the borrowing base of current assets such as accounts receivables and inventory.
A good analogy of how the facility works would be business credit cards with preset limits, which allow the user to draw funds within a prescribed limit, allowing companies to grow sales of products and services.
THE CHALLENGE OF SME/SMB COMPANIES IN ACCESSING BUSINESS CAPITAL
As the debate rages about companies' ability to access SME Commercial Finance needs, the one clear thing is that the commercial lending landscape has changed regarding the terms and conditions of access to capital.
Business alternatives are often misunderstood or unknown to the owner/management team.
Do Canadian firms realize that probably way less than 1% of firms looking for VC/Private Equity/Angel funding ever succeed? We often doubt it. For more info on Canadian government small business and key statistics, click here.
That brings us back to... ‘Choices ’ when it comes to ' business loans ' / credit lines. Only 2 real solutions are available regarding the need for a revolving credit facility and business lines of credit.
Those solutions:
Canadian Chartered banks
Commercial Finance Companies offering Asset-Based Credit Lines
Banks are ' top of mind ' when it comes to business loan financing sources—it sure helps when Canadian banks enjoy the reputation of having the best capitalization and financial strength in the world.
Working with the right banker (notice we said banker, not bank) gives you access to credit lines, term loans, leases, online banking solutions, etc.).
Interest rates on Canadian banking facilities for working capital are, of course, the lowest and most attractive in Canada ( benchmarked against the prime rate ) for firms that qualify. For any type of revolver, you only pay interest on the amount of credit you are using. That’s the good news.
In Canadian banking, a business revolving lines of credit without a personal guarantee is generally not possible! Also, business credit facilities for startups are generally not available, with personal assets and outside guarantees being available to be collateralized.
Business-oriented credit unions and community banks offer facilities to firms similar to bank offerings. Still, they are often limited in their scope of offering regarding credit approval for the business capital you require.
The issue? The banking system's stability requires that loans be solidly backed up by collateral, cash flow, personal guarantees, and the bank's insistence that sure shall we call them ' relationships' on your balance sheet stay intact.
Anyone can knock your firm out and have it classified as ' unbankable.’ In SME finance, banks significantly emphasize owners' credit scores and personal credit histories.
Our client's problem is that they often use cash without producing it! That's why our second solution, the asset-based line of credit, aka the ' ABL,' is a perfect alternative for business credit line needs.
The interest rate will always be higher in non-bank business finance solutions, but for many companies, it becomes a question of access to capital versus the cost of capital. These asset-based lending facilities are mostly structured as revolver facilities rather than a term loan type of solution.
HOW TO APPLY FOR BUSINESS CREDIT TRADELINE NEEDS
To get approved, typical requirements for applying for and for non-bank business lines include financial statements, business account bank statements, appropriate ageing schedules for assets such as receivables and payables, and a summary of the firm's credit profile.
The application process is significantly shorter than that of more traditional business bank account application timelines, which have credit rating processes subject to credit approval for a final facility limit. ABL asset-based lending commercial lenders focus on assets and asset turnover.
HOW DOES A BUSINESS LINE OF CREDIT WORK?
This facility focuses on your business assets instead of ratios and formulas for cash flow coverage for small businesses.
Your receivables, inventory and even fixed assets (yes, your fixed assets!) such as real estate ( if applicable ) are combined into one borrowing facility that allows you to draw on funds as needed.
When it comes to increasing a business credit line, ABL-type facilities almost always increase as your asset base and sales grow.
Surprisingly, the borrowing leverage on these 3 different asset accounts is even more generous than bank lines—although they almost always come at a higher borrowing cost in terms of interest charges, etc.
KEY TAKEAWAYS
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Understanding credit utilization strategies maximizes financial flexibility.
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Maintaining strong cash flow management demonstrates creditworthiness
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Securing favourable interest rates significantly impacts long-term costs
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Building relationships with multiple lenders creates financing options
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Monitoring credit scores ensures continued access to funding
CONCLUSION - UNDERSTANDING BUSINESS LINES OF CREDIT
The small business owner's search for capital and working capital requirements can seem never-ending, including getting a business line -
Are you looking for clarification on ' QUESTIONINGLY ' regarding business credit lines and borrowing alternatives?
Call 7 Park Avenue Financial, a trusted, credible, experienced Canadian business financing advisor who can assist you with your borrowing needs. Let our business advisor team help you access the right business lines of credit.
FAQ
What makes business credit lines more flexible than traditional loans?
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Draw funds as needed
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Pay interest only on used amounts
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Revolving credit availability
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No reapplication required
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Builds business credit history
How can business credit lines improve cash flow management?
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Bridge seasonal revenue gaps
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Take advantage of supplier discounts
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Fund inventory purchases
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Cover unexpected expenses
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Maintain operational consistency
What features should you look for in a business credit line?
How do credit lines support business growth?
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Enable rapid expansion
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Fund equipment purchases
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Support hiring initiatives
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Finance marketing campaigns
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Facilitate market expansion
What advantages do secured business credit lines offer?
How does the application process work?
Can I have multiple business credit lines?
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Multiple lines permitted
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Different purposes possible
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Combined limit considerations
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Cross-collateralization issues
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Management complexity factors
How often should I review my credit line terms?
What alternatives exist if I'm denied?
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Alternative lenders
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Secured options
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Business credit cards
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Equipment financing
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Invoice factoring
How do business credit lines differ from term loans?
What factors determine credit line limits?
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Business revenue
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Credit history
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Time in business
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Industry type
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Collateral availability
How can you improve chances of approval?
