How Working Capital Companies Prevent Cash Flow Armageddon Via Commercial Business Loans

Commercial business loans and asset monetization from working capital companies. It all comes down to some good working capital chemistry if you want to avoid the kind of cash flow armegeddon that besets many firms that we read about in the business papers everyday.

There is no better subject that the Canadian business owner or financil manager can focus on when it comes to improving your chances of busines survival.

And it alwasys comes down to only a few core competancies that you must master , namely collecting your receivables as they come due, managing those payables iwth your preferred vendors, and turning your inventories, if applicble, over properly . One of our favourite writers described your balance sheet recently as the place where all the dead bodies are buried .

What did he mean by that – simply that that’s where business mistakes tend to accumulate – old inventory, 90 day + receivables, and payables and accruals that arent recognized properly.

One of the best ways to aggressively generate cash flow is to ensure you have a proper financing vehicle in place for your A/R. That might be a Canadian chartered bank line of credit, or in some cases it might be a receivable financing solution from an impendent commercial finance firm. In certain cases also A/R finance might be a ‘ subset’ of an asset based line of credit. All of these solutions allow you to monetize balance sheet assets into cash flow/working capital needs.

The busines owner/ manager in the SME sector can be forgiven for viewing the cash flow situation in his or her company as complex. Bottom line, a whole bunch of things needs to happen to ensure proper business survival.

Inventory is probably even a touchier subject – it’s really easy to lose more sales opportunities and larger contracts and orders because of your improper management and financing of inventory. It’s a fine line of course because you want to keep the investment you need to make in inventory (and A/R) low but be able to satisfy all your revenue creation needs.

Ways to monetize and properly finance working capital are both traditional and alternative, and diverse. A lot of the choice you can make to finance your company really revolves around what stage your business is in when it comes to borrowing power.

That will dictate whether you can access:

Canadian chartered bank lines of credit
Receivable financing solutions
Inventory finance
Asset based non bank lines of credit
Tax Credit Monetization
Purchase Order/ Supply chain finance

All of these will get you to the goal line. But it’s simply a case of knowing how and when. Seek out and speak to a trusted, credible and experienced
Canadian equipment financing advisor who can assist you with commercial business loans from working capital companies that address your firm’s particular needs. It’s a great way to avoid cash flow Armegeddon!