Working Capital Business Financing Sources

Working Capital business financing is never a question of why – it’s just simply a matter of when! Working capital and cash flow are of course the heart of every business. The challenges of obtaining that financing become a question of time.

Perhaps you need cash for for your regular ongoing business cycle – that’s the simple one – you buy inventory, your produce things, you sell, bill and collect. In a perfect world your suppliers give you unlimited time to pay, and unlimited credit limits. And of course your customers pay you in exactly 30 days. Guess what? It’s not a perfect world!

If you are a traditionally financed firm you have access to bank capital for revolving credit lines based on your business needs. But for a growing number of Canadian firms that access to traditional bank capital is not available. Those scenarios require a special expertise in identifying sources of business financing that work for you. The solutions actually are quite numerous – its becomes a questions of which solution works for your firm, what are the costs involved, and does the solution fit within your business model.

The business financing we are talking about can take many different forms – it might include an asset based line of credit, inventory financing or purchase order financing, a sale leaseback on unencumbered assets,, working capital term loans, or accounts receivable financing, otherwise known as factoring.

One of the most important things you can do for business financing is to ensure that the type of financing you source matches your needs. What we mean by that is that you should match short term needs with short term financing. Factoring might be a good example. If your receivables aren’t financed, and you need cash to meet inventory and supplier commitments that type of financing is immediate and addresses your needs. Why would you enter into a five year term loan at fixed payments for a short term capital need or requirement?

The best way to think of short term financing is to focus on the current assets part of your balance sheet – those items include inventory and accounts receivable typically. Those assets can quickly be monetized into a working capital facility that comes in a variety methods. The reality is that your inventory and accounts receivable grow lock step to your sales and your ability to finance them on an ongoing basis will give you access to, in essence, unlimited working capital.

There are some solid technical rules of them around how you can generate positive pricing for operating facilities. By calculating and analyzing some basic financial ratios (we call them relationships) in your financial statements you can get a strong sense of whats available in working capital business financing and what pricing might be involved. Those ratios are your current ratio, your inventory turns, your receivables turns or days sales outstanding, a, and your overall debt to worth ratio. Depending on where those final ratio calculations come in will ultimately allow your working capital financier to put your firm in a low risk, medium risk, or high risk band of pricing?

In Canada working capital rates range from 8-9% per annum to 1-2% per month, depending on what assets are financed and how they are financed.

So whats our bottom line in working capital business financing? It is simply there are alternatives available and you as a business owner of financial manager can assess those alternatives in terms of short term needs or long term needs. Pricing and solutions vary, and your ability to convey the positive aspects of your business to the working capital lender will ultimately lead to a final pricing and solution. Speak to a credible, experienced and trusted working capital business financing advisor to determine what solutions are the best for your firm.

Lawsuit Financing Companies

Attorneys, law firms, lawyers, beneficiaries or clients usually form lawsuit-financing companies. Lawsuit financing companies can also provide appeal finance, firm finance, custom finance or estate finance.

Many lawyers and attorneys create lawsuit financing companies based on their experience and the types of cases they encounter the most. Attorneys and lawyers with expertise in personal injury lawsuits or patent lawsuits help by providing cash advances and support in their fields.

Lawsuit financing companies provide many financing options. With a significant monthly fee, a few lawsuit financing companies may help to settle the case faster. Though a large variety of options are available, the plaintiff has to discuss with the attorney which option is best suited to him.

The lawsuit financing company and the plaintiff can make an agreement of the amount of share the lawsuit financers would obtain after the settlement or the verdict is known. This is called “flat fee”. Apart from the flat fees, the plaintiff has to pay a minimum fee every month, called “recurring fees”, to the lawsuit financing company. This recurring fee can be as low as 2.9% in the case of a few lawsuit financing companies, or could be as high as 15% with other companies.

It is the financing company’s decision as to how much to pay as the cash advance. Lawsuit financing companies pay from $1000 to about a million dollars depending on the case.

Every lawsuit financing company would have a team of lawyers to assess the strength of the case. The key is to avoid funding frivolous complaints. Thus the financing companies will scrutinize the complaint and decide the chances of success of the case.

Lawsuit financing companies do not term their cash advances as loans but as investments. The applicant has to repay after the verdict. Usually the monetary settlement that is obtained after the settlement by the court is larger than the company’s advance. The lawsuit financing company should be paid the principal and the predetermined share of the monetary verdict.

Many lawsuit financing companies can be approached through the Internet. Companies like legalcashnow.com, legalfundingnetwork.com and lawsuitcash.com are available on the Internet. Websites like these are flooded with information and instructions regarding lawsuit financing.

Manufacturing Equipment Financing

Generally all manufacturing companies require some equipment for the smooth running of their processes. They may need to replace any outdated equipment or to buy new equipment at any point of time. Investing in equipment is therefore important for any manufacturing concern. In fact, investing in new manufacturing equipment to produce goods can increase the flow of revenue. Since the cost of such equipments is high, the need for manufacturing equipment financing arises.

Since various manufacturing companies produce different types of commodities, the manufacturing equipment financing options would vary accordingly. You can seek financial help of any of the reliable financing companies in order to acquire new manufacturing equipment that stretch the cash revenues.

Machine tool financing is one of the types of manufacturing equipment financing that is required for any machine shops or iron shops. Lathe machine, drilling machine, routers, roll forming, milling, punch press etc are some of the machine tools indispensable for the machine or iron shops. Computer control machine tools are the advancements in this field. However they are expensive and so seeking the financial assistance of any legitimate financing company are important to acquire such equipment.

Woodworking equipment financing is often desirable to acquire exceptional woodworking equipment. Panel saw machines, belt sander, door frame machine, wood shaper machine etc are some of the unique equipments used in this field. Since these equipments are special in nature, many financing companies may not be willing to provide help. These equipments are not only special but are also expensive. Hence manufacturing equipment financing is a must. There are few valid financing companies that offer financial assistance to buy these types of equipment.

Stone and glass cutting and fabrication equipment are really unique in nature. For instance, diamond cutting equipment can be used for that purpose only. This specialized nature of these types of equipments may raise complexity in getting financial help from the financial institutions. Yet there are some genuine financing companies that offer manufacturing equipment financing help to acquire stone and glass cutting and fabrication equipment. They also provide various options like edge polishing equipment financing, sandblasting equipment financing, glass cutting equipment financing and so on.

Rubber and plastic equipments are required by some manufacturing companies. Recycling equipment, rubber molding machine, thermoforming machine, rubber vulcanization machine, plastic molding machine etc are special in nature and so traditional finance lending institutions may not be ready to provide financial assistance. Hence a reliable financing company which is expert in dealing with manufacturing equipment is vitally important.

Embroidery equipments have undergone various advancements and so acquiring the computer control equipment is important for the companies that engage in embroidery making. Some financing companies offer manufacturing equipment financing help to acquire the embroidery equipment.