YOUR COMPANY IS LOOKING FOR BUSINESS ASSET 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?
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
7 Park Avenue Financial originates business financing solutions for Canadian Businesses – We offer Business Cash Flow 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”
Financing Your Business Cash Flow Needs
Financing cash flow needs for Canadian businesses must often have many business owners/financial managers feeling as if they’re on a "bouncy castle with a patchy power supply"!
Talk about insecurity.
Business asset finance involves understanding how your firm's cash flow relates to its sales cycle. Let's examine this issue.
Did You Know?
- 82% of business failures are due to poor cash flow management
- 60% of Canadian SMEs face cash flow challenges
- Average payment terms in Canada are 57 days
- 27% of businesses cannot access traditional financing
- The cash flow financing market is growing 20% annually
Break Free From the Cash Flow Trap
Every business faces cash flow gaps that can strangle growth and threaten survival. Late-paying customers, seasonal fluctuations and unexpected expenses create pressure on working capital. Without proper financing solutions, these challenges can force businesses to miss opportunities or struggle to meet obligations.
Let the 7 Park Avenue Financial team show you how modern financing options can provide flexible solutions that align with your business cycles and growth needs.
Understanding the Sources of Cash Flow
Where Does Your Cash Flow Come From?
Do you know where your cash flow and working capital come from? Essentially, it’s either from your balance sheet - i.e., your business credit lines and the amount of owner equity on your balance sheet.
The cash you generate from your sales cycle then complements that. Here, it's about asset turnover and the proper financing of those assets—i.e., inventories, receivables, and fixed assets.
The Role of Timing in Cash Flow Success
Your ability to turn revenues into cash inflow is about timing and will ultimately determine your business’s success.
Strong asset turnover will also limit the amount of borrowing required to monetize your assets or finance new equipment/technology needs.
Cash Flow vs. Revenue and Profit
Cash flow, revenue, and profit are three related but distinct financial concepts. Revenue refers to the income a company earns from its sales of goods or services.
Conversely, profit is the amount of money left over after subtracting expenses from revenue.
As we discussed earlier, cash flow refers to the movement of money into and out of a company over a certain period.
While revenue and profit are essential indicators of a company’s financial health, cash flow is a critical metric for understanding its liquidity and ability to meet its financial obligations.
A company can have high revenue and profit but still experience cash flow challenges if it is not managing its cash inflows and outflows effectively. Therefore, maintaining a healthy cash flow is essential for sustaining day-to-day operations and ensuring long-term success.
Planning Your Cash Flow Needs
How Much Cash Do You Need to Run Your Business?
So, how much cash do you need to run your business? We could defer to our lawyer for an answer ("Well... it depends"), but instead, we'll say that it is, in fact, relatively easy to both understand and plan your cash flow needs.
The Impact of Sales on Cash Flow Management!
So, how does your revenue affect how you manage and finance cash flow needs?
Any delays in the entire sales cycle (from sale to collection of your goods/services) will slow down your operating cash flow, which is crucial for evaluating your financial health. In effect, until you collect your money from clients, you are a “consumer” of cash, not a “generator.”
Key Areas to Focus on for Cash Flow Management
Three Key Areas to Maximize Cash Flow
There are three areas you need to focus on to ensure maximum cash flow and minimize cash flow finance needs:
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Solid financial controls around credit extension/collection
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Understanding your client base - repayment discounts, terms, etc.
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Knowing which finance solution (traditional or alternative) works best for your firm
Exploring Business Financing Solutions
Popular Financing Options for Cash Flow Needs
These solutions include:
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A/R Financing
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Inventory Finance
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Working Capital Term Loans
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Tax Credit Monetization Financing
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Government Guaranteed Business Loans
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PO/Contract Financing
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Sales Royalty Financing
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Asset-Based Business Credit Lines - revolving facilities that allow you to borrow against receivables, inventory, and equipment
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Equipment Leasing/Sale Leasebacks
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Cash Flow Lending - an unsecured financing option tailored for businesses to manage daily operational expenses, based on the business's ability to generate consistent cash flow rather than tangible assets
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Cash Flow Loan - a specific type of financing that allows businesses to borrow against their future cash flow, often involving personal guarantees and high fees, providing quick access to capital for immediate financial challenges
Mastering Cash Flow Financing
Mastering cash flow financing requires a deep understanding of a company’s cash flows and financial needs. Here are some tips for mastering cash flow financing:
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Understand your cash flow: Start by understanding your company’s cash flows, including its cash inflows and outflows. This foundational knowledge is crucial for effective cash flow management.
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Identify cash flow challenges: Identify areas where your company may be experiencing cash flow challenges, such as slow-paying customers or high expenses. Recognizing these issues early can help you take corrective action.
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Explore financing options: Explore different financing options, such as cash flow loans, invoice factoring, and merchant cash advances, to determine which is best suited to your company’s needs. Each option has its own set of benefits and considerations.
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Manage your cash flow: Implement effective cash flow management strategies, such as forecasting and monitoring, to ensure that your company manages its cash flows effectively. Regularly reviewing your cash flow statements can help you stay on top of your financial situation.
By following these tips, businesses can master cash flow financing and ensure they have the funds they need to grow and succeed.
Effective cash flow management is key to overcoming cash flow challenges and achieving long-term financial stability.
Case Study:
A Canadian vacation tour company faced seasonal cash flow challenges that limited growth. They accessed 100,000 in working capital within 48 hours by implementing a flexible cash flow financing solution. This enabled them to accept larger bookings, negotiate better supplier terms, and increase annual revenue by 40%. Their success demonstrates how strategic cash flow financing can transform business operations and fuel sustainable growth.
Key Takeaways
- Understanding cash flow cycles drives optimal financing decisions
- Accounts Receivables conversion speed determines working capital needs
- Strategic timing of financing applications maximizes approval odds
- Matching financing products to specific business needs ensures success
- Leveraging existing assets unlocks multiple funding options
Conclusion
Are you focused on relieving that insecurity related to cash flow and financing assets?
Call 7 Park Avenue Financial, a trusted, credible, and experienced Canadian business financing advisor who can assist you with financing cash flow needs.
FAQ
What makes cash flow financing different from traditional loans?
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No fixed monthly payments
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Funding based on receivables quality
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Flexible credit requirements
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Quick approval process
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Scale with business growth
How does cash flow financing improve business operations?
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Accelerates growth opportunities
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Smooths seasonal fluctuations
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Strengthens supplier relationships
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Enables bulk purchase discounts
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Improves cash flow predictability
What types of businesses benefit most from cash flow financing?
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B2B companies
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Seasonal businesses
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Fast-growing enterprises
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Government contractors
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Manufacturing companies
How quickly can businesses access cash flow financing?
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Same-day approval possible
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Funding within 24-72 hours
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Simple application process
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Minimal documentation needed
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Immediate access to credit line
What are the cost considerations for cash flow financing?
How do I qualify for business cash flow financing?
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Minimum 6 months in business
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Monthly revenue over $10,000
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Valid business registration
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Active bank account
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Clean business history
What documentation is typically required?
How does repayment work?
What are the alternatives to cash flow financing?
How do I choose the right financing option?
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Assess business needs
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Compare costs
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Review terms
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Check requirements
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Evaluate flexibility
What factors influence cash flow financing approval?
How do short-term working capital loans compare to traditional bank loans?
What are the key success factors in cash flow financing?
How do you read a cash flow statement?
A cash flow statement shows where a company’s money comes from and where it goes over a specific time. It's a key tool for business owners, investors, and managers to make smart financial decisions.
The statement of cash flows has three main sections:
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Operating Activities: Cash generated funds from day-to-day business, like sales and expenses.
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Investing Activities: Money spent on or earned from big assets, like equipment or investments.
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Financing Activities: Money from loans, investors, dividends, or debt payments.
To read it, check these sections and look for trends:
Understanding these patterns helps you make better financial decisions for your business as well as to understand better the relationship between the income statement and cash flow basics.
What are the pros and cons of cash flow financing?
Pros and Cons of Cash Flow Finance
Cash flow finance is a type of financing that allows businesses to borrow against their future cash flows. Here are some pros and cons of cash flow finance:
Pros:
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Quick access to funds: Cash flow finance can provide businesses with quick access to funds, which can be used to cover short-term cash flow gaps or to finance growth opportunities.
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No need for collateral: Cash flow finance does not require collateral, making it an attractive option for businesses that do not possess the hard assets needed to back an asset-based loan.
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Flexible repayment terms: Cash flow finance often comes with flexible repayment terms, which can be tailored to the business’s cash flow needs.
Cons:
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High fees: Cash flow finance often comes with high fees, which can be a significant burden for businesses with limited cash flow.
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Personal guarantees: Cash flow finance may require personal guarantees, which can put the business owner’s personal assets at risk.
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Short-term focus: Cash flow finance is intended for short-term use only, which may not be suitable for businesses with longer-term cash flow concerns.
