Is there life after business working capital financing and cash flow runs out? It's unthinkable but the reality is that
business failure looms in the horizon when companies in Canada (and everywhere
else by the way)
So how do you cope with cash flow challenges and what
does the Canadian business owner and financial manager need to do to address
this financing challenge.
As a starter, whether business people like it
or not (certainly owners and financial managers) you have to have a grasp on
your overall liquidity situation. This essentially becomes a matter of
relationships, understanding how the relation of your current assets (
receivables, inventory, cash on hand ) are relevant to your cash flow
success.
Not every analysis of some of these relationships is going to be
relative to your firm all the time. The reality is that different industries
have different financial profiles and it becomes a case of understanding where
your company fits into the industry profile. And by the way, we never met a
client yet who didn't think their firm was a bit different!
When you look
at cash flow solutions you're looking at really two areas of focus, one is the
overall solvency of your firm, and secondly the amount of risk you're prepared
to take in making investments, taking on debt, and growing their
company}.
That's of course the inner view. The outer view is from lenders
and suppliers, who are looking inside your company} relative to your debt paying
capability and your overall financial health, now and somewhat into the future.
They have a vested interest in doing that based on what products of services
they are supplying. And lenders don't even get us started on that...! The bottom
line is they are looking to get repaid!
So business working capital
financing then becomes a measure of looking at your balance sheet, i. e. your
company resources... and addressing the various types of assets you have and how
to monetize them to meet your operational goals. Any look into your balance
sheet is a 'static one’... it's where you are at one place in time. It basically
reflects how you're performing today. That income and cash flow statement
basically show you how you got there.
So it's therefore important to
understand some of those structural relationships when addressing cash flow
financing.
In Canada your choices for working capital financing are one,
or a combination of the following - receivable financing, sale leaseback
financing, inventory financing, cash flow term loans, and bank and asset based
lines of credit.
Which one of the above makes sense for your firm and how
do you satisfy those working capital objectives? Speak to a trusted, credible
and experienced Canadian business financing advisor today on how to best meet
your business finance needs for growth and operational survival.
Find the related info about Finance through the Online Finance.
Getting Business Working Capital Financing Right. Ideas, Tips And Solutions For Cash Flow Finance