Are finance solutions for Canadian business a necessity? Whether it’s a term loan, chartered bank financing, or choosing from alternative lending vehicles top experts agree you might be able to survive awhile from a lack of profits, but finance solutions and access to cash flow are critical.

And contrary to what you might think, there’s no secret society around access to solid business financing choices. Let’s dig in!

The goal is of course ‘ health’, i.e. healthy business. That comes from managing your assets, financing them, giving your clients credit terms, and being able to access business credit.

It’s key to understand how the ‘ financial structure’ of your business is viewed by others. For instance if you have a lot of debt but are still viable you will reasonable be expected to pay 2-3 times the amount of interest charged by Canadian banks via alternative lending options . When you think about it how you manage your assets is really how you make your money.

Working capital and cash flow access only become critical… when you need them! Whether its external factors such as a recession, or internal issues specific to your company and industry your inability access credit puts your company on the precipice.

As we have stressed in the past it’s about managing assets and financing assets. Business owners and financial managers in the SME sector should feel good about the fact that even the largest corporations place a major focus on cash forecasting, financing, and managing assets.

The range of financial solutions available to Canadian business might be larger than you think. Common solutions available to your firm include:

A/R financing

Inventory finance

PO/Supply Chain Financing

Asset based business lines of credit

Canadian commercial bank credit – (revolvers/term loans)

Equipment Financing

Bridge Loans on Assets

Sale Leaseback Strategies

Tax Credit Monetization

Securitization

How does the business owner/financial manager know when they need a specific type of financing? Essentially the answer to that lies in your operating cycle and understanding you business around issue such as:

Customer credit quality

Payment experience versus your payment terms

Short term and long term fixed debt obligations and how they impact cash flow

Your ability to project cash receipts.

How do the above issues affect your financing needs? Simply that asset management will both save you from a cash crisis, eliminate the need for more financing than you need, and allow you to be move competitive in client terms and the ability to take on more business opportunities /larger contracts.

It’s a bit of a balancing act because you want to limit the amount of financing you need to access but you still want to be able to grow. If you’re looking for traditional, or alternative lending that matches your needs seek out and speak to a trusted credible and experienced Canadian business financing advisor who can provide that ‘wake up’ call to finance alternatives.