Business Financing Health : Recognizing Finance Options

Business financing options in Canada often depend on the overall health of your company. A lot about questions can be answered near to simply looking at some very basic and fundamental numbers and relationship in your financials. The doctor is in. Let’s dig in!

Key to any business financing or survival for that matter is the whole issue of solvency . Here owners and managers want to assess the true of assets and debt. Lenders instructions uniformly want to focus on possessor equity, with a more refined focus of this number being ‘ tangible net worth.

Finance options will also depend on your endowment and need to meet current financing commitments. Here we will point out that even a company that has had its loan called can calm get very strong levels of alternative financing based solely on the asses of the business. This type of financing typically is called ‘ Plus BASED LENDING ‘ and can come in legion forms, both term debt and operating debt. They provide a path back to what countless term ‘ traditional financing ‘.

The asset lending we’ve mentioned, when it comes to operating financing, will near always revolve around receivables and inventory. The size, quality, furthermore management of these two worth instructions dictate what type of financing you need… and… as importantly are eligible for.

You can properly measure, and help manage these two assets in some basic simple ways. In the case of A/R it plainly calculating your ‘ day’s sales’ in receivables turnover. Since the sale about register translates into a sale and then a receivable the management including tracking of A/R and inventory is a great way to track business health. P.S. The big companies do it all the time, all day, every day, and more often than not senior management is compensated on the management and effectuation about these two assets.

In the past, and we consider we’re doing it, we’ve suggested to clients that they track a simple chart that shows sales growth and then measures that same growth against the growth of A/R and inventories,

When looking at finance options it’s important to rate whether you are looking for business financing to operate, start, or expand. In addition to traditional capitalize solutions offered by the Canadian chartered banks numerous other solutions work. They include:

A/R Financing
Working capital term loans
Inventory financing
Asset based lines of Credit
SR&ED Tax Credit Bridge Loans
Govt Small practical loans (to maximum 350k)

Seek out and orate to a trusted, credible and experienced Canadian trading financing advisor who can SOS you assess task health and finance options that suit your operating or growth requirements.

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