Business credit and working capital are consistently one of your firms largest obstacles to innovation and growth in sales and profits. What can be done via either a traditional or alternative method of ensuring your firm has all the financing you need to generate growth? Let’s examine some of those solutions.
You can’t find it if you don’t know what you are looking for. What do we mean by that? Simply that cash flow, working capital, business financing can be sometimes ‘ overworked’ ‘ catch all’ terms that mean various things to various people. Therefore you must focus on the need first, not the solution. Thankfully those needs can be nicely broken down into several categories as follows: day to day operating capital, immediate growth needs for new opportunities, equipment and asset acquisition, hard asset refinancing.
The easy ‘ go to ‘ solution is to solicit chartered bank financing in Canada. Companies with strong balance sheets, profits, established history and additional collateral etc can more often than not find all the financing they need with one of Canada’s chartered banks.
That’s easy for us to say, but the majority of clients we meet simply can qualify for all business credit and working capital they need to survive and grow. Typically they have some traditional financing but not enough, or, in a more severe case, do not qualify for traditional bank lending in the Canadian landscape.
When the going gets tough, the tough get going goes the expression, so it is a case of getting somewhat ‘ creative’ in your search for working capital .
If your firm has assets and growth prospects we firmly believe you can get most, if not all the financing you need. This financing can be achieved in a number of ways. You can monetize your current assets via a working capital facility for receivables and inventory. If properly set up you should congratulate yourself as you have just negotiated unlimited working capital – because these facilities allow you to borrow on an ongoing basis relative to the size of your current asset investment in accounts receivable and inventory. We referred to generalization of terms such as cash flow, working capital, etc – the lending we have just described is best known as asset based lending, and in many cases can cover off purchase orders and new contracts also.
Equipment financing and sale leaseback financing for new and owned/unencumbered equipment are great solutions to acquire or refinance capital acquisitions. In Canada lease financing is available for all asset and credit qualities for any amount, from 1000.00 to millions of dollars.
Although the majority of clients we discuss working capital needs with are private firms your firm might be public, as a result you might be in a position to consider an equity line of credit, with the equity questions being your stock.
If your firm has revenues under 5 Million dollars and is privately owned you should consider the best financing available in Canada – it’s the government BIL/CSBF loan that is underwritten by our good friends in Ottawa. Loans up to 500,000.00$ are available for hard assets such as equipment, leaseholds, real estate, etc. You can even be a start up and qualify. The financing rate is incredible attractive, guarantees are limited, and terms and structure flexible.
Its always about the bottom line, so whats our bottom line today – simply that you need to focus on what type of financing you need , determine if you qualify for traditional financing, and if you don’t get creative with a multitude of solutions available .
Confused about the Canadian business financing landscape and what and who is waiting for you out there. Speak to a trusted, credible and experienced business financing advisor who will guide you through the maze to what we believe will be the right solution for your firm.