Nowadays you most likely would be pleased with 1 solid capital financing solution for the income small business.
We’ll beat that and provide you with 5! How’s that for alternative methods to your capital and funds flow needs?
Funding of capital remains a sizable challenge for Canadian companies of size – you need to increase your business which requires investment of and in it, one more thing individuals suppliers and employees wish to be compensated promptly also.
Lets examine some solid real life methods to your money flow needs – in some instances these could meet your needs, however in general even a few these solutions would ‘ fix ‘ the present problems you face on a day-to-day basis.
Probably the most liquid asset any company has, (alongside cash) is the receivables. Capital financing is better generated through the collection, or financing of the receivables. You can do this via either faster collections, or selling your receivables while you generate them. This financing is known as receivable discounting or factoring, and it is becoming growing popular everyday.
Have you ever consider the federal government of Canada among your very best capital financing partners? Our customers are amazed whenever we claim that ‘ partner’ like a solution. However the specialized government program, technically known as the BIL/CSBF loan program finances any equipment and leasehold enhancements you’ll need using a greatly subsidized loan program. We are saying subsidized, because even if you’re a launch minute rates are great, guarantees are restricted, and loan max amount can be 350,000.00. Our clients who utilize this program contemplate it, bar none, the very best financing in Canada for medium and small business, including start ups.
You’ve spent your capital – do you want to have it fixed? Clients always ask what we should mean with that. Any equipment you’ve already compensated for can frequently be refinanced, the technical term is purchase leaseback, so we discover that either that strategy or perhaps a temporary bridge loan using the equipment as security is what our clients have to bridge the money flow gap.
We spoke above about receivable financing – among the best facilities for Canadian clients are a combo capital facility that finances, or ‘ margins ‘ your A/R as well as your inventory. Because so many firms formerly could not finance their inventory either elsewhere, or via banks, the combined liquidity of borrowing upon your A/R and inventory is really a true power punch! Typical this kind of financing is called a good thing based lending facility, and makes most sense once the facility reaches lease within the 250k range, and sky’s the limit next.
Many customers are totally not aware the acquisition orders financing will come in Canada. This can be a strong potential income saver, and generator, as your suppliers are compensated for product whenever you order it, after you have received the P O. The P O loan provider takes the inventory and receivable as security, however in effect finances all of your purchase. Even though it is an costly type of financing for those who have good gross margins and may otherwise not facilitate the purchase of the large new orders and contracts it is a perfect solution.