Successfully reported this slideshow.
We use your LinkedIn profile and activity data to personalize ads and to show you more relevant ads. You can change your ad preferences anytime.
MERCHANT ADVISORS
WORKING CAPITAL

WWW. ONLINECHECK. COM
WHAT IS WORKING
CAPITAL? 

WORKING CAPITAL IS THE

USABLE EXCESS OF YOUR

CURRENT ASSETS SUCH AS

PURCHASABLE INVOICES,  ....
oj. 

      

Swi-

/  F. .,
_ 3?‘-5

MERCHANT ADVISORS UNIQUE OFFERINGS

UNLIKE CONVENTIONAL WORKING CAPITAL SOLUTIONS,  ...
WORKING CAPITAL IS THE FINANCING IN A SMALL BUSINESS THAT HELPS A
COMPANY PAY ITS TRADE CREDITORS AND CASH FLOW - IT IS TH...
SHORT
TERM
SOURCES
OF
WORKING
CAPITAL
FINANCING

‘u M I-: na HANT
.  T ADVISORS
_ Us p‘4.IEI,7,IE‘. I.? -.7.. ‘-n‘ 53"
W ‘I

_ 1 -': V'_‘, ’l‘l~‘_I’_Ol. 'lf. ;

: "': v": r~eI_: ,I. I,. ‘,I_¢-A I:  : 'i...
INVOICE §"'-55°'13s’3?'s'

DISCOUNTING . . Q

INvoIcE DIscouNTING IS

A FORM or ASSET BASED
FINANCE WHICH ENABLES

A BUSIN...
A LETTER or CREDIT IS A oocU: v.ENT
THAT A FINANCIAL INSTITUTION ISSUES
To A sELLER or GOODS oR sERvIcEs
WHICH SAYs THAT T...
BANK OVERDRAFT

A BANK OVERDRAFT IS WHEN SOMEONE IS ABLE TO
SPEND MORE THAN WHAT IS ACTUALLY IN THEIR
BANK ACCOUNT.  THE O...
COMMERCIAL PAPERS

A COMMERCIAL PAPER IS AN UNSECURED PROMISSORY NOTE.  COMMERCIAL
PAPER IS A MONEY-MARKET SECURITY ISSUED...
INSTALLMENT CREDIT

INSTALLMENT CREDIT IS A FORM OF
FINANCE TO PAY FOR GOODS OR
SERVICES OVER A
PERIOD THROUGH
THE PAYMENT...
TRADE FINANCE

VAN EXPORTER REQUIRES AN IMPORTER TO PREPAY FOR GOODS SHIPPED. 
THE IMPORTER NATURALLY WANTS TO REDUCE RISK...
N LONG TERM

0‘ SOURCES
' OF

WORKING
CAPITAL
FINANCING

‘B HERB HANT
.  M ADVISORS
I——. 

EQUITY CAPITAL REFERS TD THE PORTION DF A COMPANY'S
EQUITY THAT HAS BEEN OBTAINED (OR WILL BE OBTAINED)
BY TRADING ...
LOANS

A LOAN IS A TYPE OF DEBT WHICH IT ENTAILS THE

REDISTRIBUTION OF FINANCIAL ASSETS OVER TIME, 

BETWEEN THE LENDER A...
WORKING CAPITAL FINANCE IS DEFINED AS
THE CAPITAL OF A BUSINESS THAT IS USED

IN ITS DAY-To-DAY TRADING OPERATIONS,   "
CA...
DIFFERENT PROVIDERS FOR SMES IN THE MARKET

DESPITE THE LARGE NUMBERS OF PROVIDERS OF WORKING CAPITAL FINANCE,  THERE IS L...
CAI‘!  HELP SMES

MERCHANT ADVISORS IS VERY DIFFERENT TO
THE MAIN SHORT TERM SOURCE OF WORKING
CAPITAL FINANCE,  FACTORING...
FUNDING SOLUTION THAT WORKS FOR YOU

AT MERCHANT ADVISORS,  WE HAVE DELIVERED MILLIONS OF DOLLARS TO SMALL
BUSINESSES IN W...
Upcoming SlideShare
Loading in …5
×

Working Capital Financing & Sources Of Working Capital

3,779 views

Published on

Working capital is the usable excess of your current assets such as purchasable invoices, or sale of future credit card processing receipts. Working Capital is the life blood of all small businesses as it is essential to cover operating expenses on a daily basis. At Merchant Advisors, our goal is to assist businesses with working capital financing. We know that strong cash flow and good payment behavior can validate the steady performance of your business.

Published in: Business
  • Be the first to comment

Working Capital Financing & Sources Of Working Capital

  1. 1. MERCHANT ADVISORS WORKING CAPITAL WWW. ONLINECHECK. COM
  2. 2. WHAT IS WORKING CAPITAL? WORKING CAPITAL IS THE USABLE EXCESS OF YOUR CURRENT ASSETS SUCH AS PURCHASABLE INVOICES, . OR SALE OF FUTURE CREDIT S CARD PROCESSING RECEIPTS. WORKING CAPITAL IS THE LIFE BLOOD OF ALL SMALL BUSINESSES AS IT IS ESSENTIAL TO COVER OPERATING EXPENSES ON A DAILY BASIS. Ru Mr-: Rc HANT - j ADVISORS
  3. 3. oj. Swi- / F. ., _ 3?‘-5 MERCHANT ADVISORS UNIQUE OFFERINGS UNLIKE CONVENTIONAL WORKING CAPITAL SOLUTIONS, MERCHANT ADVISORS DOESN'T CHARGE CLIENTS MONTHLY FEES, OR REQUIRE THEM TO USE MERCHANT ADVISORS A CERTAIN NUMBER OF TIMES A YEAR ALLOWING FIRMS MAXIMUM FLEXIBILITY. WE DON'T ASK FOR A PERSONAL GUARANTEE OR DEMAND ONEROUS CHARGES. WE CAN ALSO OFFER A COMPLETELY CONFIDENTIAL SERVICE. OUR WORKING CAPITAL FINANCING OFFERS YOUR BUSINESS THE) FOLLOWING BENEFITS: 1) Construction, renovation or leasehold improvements ' . —". Aovrsons 2) To purchase furniture, fixtures, machinery, or equipment 3) For the flooring of inventory and for working capital (payroll) 4) As a down payment to finance the purchase of real estate for the business or other businesses to expand your entrepreneurial reach!
  4. 4. WORKING CAPITAL IS THE FINANCING IN A SMALL BUSINESS THAT HELPS A COMPANY PAY ITS TRADE CREDITORS AND CASH FLOW - IT IS THE FINANCE THAT BUSINESSES NEED FOR THEIR DAY-TO-DAY TRADING OPERATIONS. ALL SMALL BUSINESSES NEED WORKING CAPITAL, BUT SOMETIMES THEY ARE UNABLE TO ACCESS THE CASH THAT THEY NEED BECAUSE THEY HAVE TO WAIT FOR LARGE INVOICES TO BE PAID - SOMETIMES FOR UP TO DAYS. THERE WAS A TIME WHEN YOUR BANK WOULD GLADLY HELP YOU THROUGH SHORT"TERM CASH FLOW DIFFICULTIES WITH A LOAN OR OVERDRAFT EXTENSION, BUT IT'S BECOME MUCH TOUGHER TO ACCESS TO BANK FINANCE. EVEN IF YOU ARE SUCCESSFUL, IT CAN TAKE CAN WEEKS TO SORT OUT - AND YOU'LL PROBABLY HAVE TO PROVIDE A PERSONAL GUARANTEE. ANOTHER ALTERNATIVE IS FACTORING, OR A LOAN.
  5. 5. SHORT TERM SOURCES OF WORKING CAPITAL FINANCING ‘u M I-: na HANT . T ADVISORS
  6. 6. _ Us p‘4.IEI,7,IE‘. I.? -.7.. ‘-n‘ 53" W ‘I _ 1 -': V'_‘, ’l‘l~‘_I’_Ol. 'lf. ; : "': v": r~eI_: ,I. I,. ‘,I_¢-A I: : 'i‘: _i;1lItr‘lfl9)€_I: "i. ' ‘~‘I. '€l. |l: I"i= { 1:'i: :I. i:‘I~‘:4i‘: i-‘I *: ":i”: ‘imI i: i.ii. ‘’’I"ii‘I. ’‘i. c‘. . : » i: iI; ‘ii: i:i1~—A: I;"‘ts-1 i':4I= I.ff'I_I'3.I9I lL‘l“. '.'I, E.lI-‘: :li I-III. I., ','. ‘I. I“I'eI. ~'II‘~. E‘v e_I'. 'I_g"l= I:%: I. i:ii; ~.. ~ M-‘: ~:~; ::f"i‘I"‘. "'r“: <;-in : ”ii: tv--: :i“i; Vi; i:‘i‘1;= : :2‘: . -‘I“i~1f*f+2 I in ‘vi’-3* . : ‘ f‘ “{I7|. :l t~ -. ?r‘I. ';_t: :“' " r' | i‘_. ‘If: "i. ..i’, .I’ I_L“l‘é: .: ietI_| l__: _(~c'"2.-‘.1 ‘Ks: :, f:. II~jl= ,- "I5-"I}II'I'I": 'l‘I. : FACTORING FACILITY ARRANGEMENTS TEND TO BE RESTRICTIVE AND ENTERING INTO A WHOLE-TURNOVER FACTORING FACILITY CAN LEAD TO AGGRESSIVE CHASING OF OUTSTANDING INVOICES FROM CLIENTS, AND A LOSS OF CONTROL OF A COMPANY'S CREDIT FUIICTION. .
  7. 7. INVOICE §"'-55°'13s’3?'s' DISCOUNTING . . Q INvoIcE DIscouNTING IS A FORM or ASSET BASED FINANCE WHICH ENABLES A BUSINESS To RELEASE CASH TIED up IN AN INVOICE AND UNLIKE FACTORING ENABLES A CLIENT To RETAIN CONTROL OF THE ADMINISTRATION OF ITS DEBTORS.
  8. 8. A LETTER or CREDIT IS A oocU: v.ENT THAT A FINANCIAL INSTITUTION ISSUES To A sELLER or GOODS oR sERvIcEs WHICH SAYs THAT THE ISSUER WILL PAY THE sELLER FOR GOODS/ SERVICES THE SELLER DELIVERS To A THlRD- ARTY BUYER. THE ISSUER THEN SEEKS REIMBURSEMENT FROM THE BUYER OR FROM THE BUYER’s BANK. THE DOCUME. ‘~! T IS ESSENTIALLY A GUARANTEE To THE SELLER THAT IT WILL BE PAID BY THE ISSUER or THE LETTER OF CREDIT REGARDLESS or WHETHER THE BUYER ULTIMATELY FAILS To PAY. IN THIS wAY, THE RISK THAT THE BUYER WILL FAIL To PAY IS TRANSFERRED FROM THE sELLER To THE LETTER or cREoIT’s ISSUER. F’? M E RI: E-: /ANT r ADVISORS
  9. 9. BANK OVERDRAFT A BANK OVERDRAFT IS WHEN SOMEONE IS ABLE TO SPEND MORE THAN WHAT IS ACTUALLY IN THEIR BANK ACCOUNT. THE OVERDRAFT WILL BE LIMITED. A BANK OVERDRAFT IS ALSO A TYPE OF LOAN AS THE MONEY IS TECHNICALLY BORROWED. A Ru MERE: HANT . j ADVISORS
  10. 10. COMMERCIAL PAPERS A COMMERCIAL PAPER IS AN UNSECURED PROMISSORY NOTE. COMMERCIAL PAPER IS A MONEY-MARKET SECURITY ISSUED BY LARGE CORPORATIONS TO GET MONEY TO MEET SHORT TERM DEBT OBLIGATIONS E. G.PAYROLL, AND IS ONLY BACKED BY AN ISSUING BANK OR CORPORATION’S PROMISE TO PAY THE FACE AMOUNT ON THE MATURITY DATE SPECIFIED ON THE NOTE. SINCE IT IS NOT BACKED BY COLLATERAL, ONLY FIRMS WITH EXCELLENT CREDIT RATINGS WILL BE ABLE TO SELL THEIR COMMERCIAL PAPER AT A REASONABLE PRICE. fl MERE: HANT ' M ADVISORS
  11. 11. INSTALLMENT CREDIT INSTALLMENT CREDIT IS A FORM OF FINANCE TO PAY FOR GOODS OR SERVICES OVER A PERIOD THROUGH THE PAYMENT OF PRINCIPAL AND INTEREST IN REGULAR PAYMENTS.
  12. 12. TRADE FINANCE VAN EXPORTER REQUIRES AN IMPORTER TO PREPAY FOR GOODS SHIPPED. THE IMPORTER NATURALLY WANTS TO REDUCE RISK BY ASKING THE EXPORTER TO DOCUMENT THAT THE GOODS HAVE BEEN SHIPPED. THE IMPORTERIS BANK ASSISTS BY PROVIDING A LETTER OF CREDIT TO THE EXPORTER (OR THE EXPORTERIS BANK) PROVIDING FOR PAYMENT UPON PRESENTATION OF CERTAIN DOCUMENTS, SUCH AS A BILL OF LADING. THE EXPORTERIS BANK MAY MAKE A LOAN TO THE EXPORTER ON THE BASIS OF THE EXPORT CONTRACT.
  13. 13. N LONG TERM 0‘ SOURCES ' OF WORKING CAPITAL FINANCING ‘B HERB HANT . M ADVISORS
  14. 14. I——. EQUITY CAPITAL REFERS TD THE PORTION DF A COMPANY'S EQUITY THAT HAS BEEN OBTAINED (OR WILL BE OBTAINED) BY TRADING STOCK To A SHAREHOLDER FDR CASH OR AN EQUIVALENT ITEM DF CAPITAL VALUE. EQUITY COMPRISES THE NOMINAL VALUES DF ALL EQUITY ISSUED (THAT Is, THE SUM OF THEIR FIT “PAR VALUES”). SHARE CAPITAL CAN SIMPLY * BE DEFINED AS THE SUM DF CAPITAL (CASH DR OTHER ASSETS) THE COMPANY HAS RECEIVED FROM INVESTORS FOR ITS SHARES. [7 M E R8 HANT I (P __ T) I ADVISORS
  15. 15. LOANS A LOAN IS A TYPE OF DEBT WHICH IT ENTAILS THE REDISTRIBUTION OF FINANCIAL ASSETS OVER TIME, BETWEEN THE LENDER AND THE BORROWER. IN A LOAN, THE BORROWER INITIALLY RECEIVES OR BORROWS AN AMOUNT OF MONEY FROM THE LENDER, AND IS OBLIGATED TO PAY BACK OR REPAY AN EQUAL AMOUNT OF MONEY TO THE LENDER AT A LATER TIME. TYPICALLY, THE MDNEY Is PAID BACK IN REGULAR INSTALLMENTS, DR PARTIAL REPAYMENTS; IN AN ANNUITY, EACH INSTALLMENT Is THE SAME AMOUNT. ACTING AS A PROVIDER DF LoANs Is DNE DF THE PRINCIPAL TAsKs FDR FINANCIAL INSTITUTIONS LIKE BANKS. A SECURED LDAN IS A LDAN IN wHICH THE BORROWER PLEDGES SOME ASSET (E. G. A CAR DR PROPERTY) As CDLLATERAL. UNSECURED LDANs ARE MONETARY LDANs THAT ARE NDT SECURED AGAINsT THE BDRRowER’s ASSETS.
  16. 16. WORKING CAPITAL FINANCE IS DEFINED AS THE CAPITAL OF A BUSINESS THAT IS USED IN ITS DAY-To-DAY TRADING OPERATIONS, " CALCULATED AS THE CURRENT ASSETS MINUS THE CURRENT LIABILITIES. FDR A ’ MANY COMPANIES, THIS IS WHOLLY I COMPRISED OF TRADE DEBTORS (THAT IS, BILLS DUTSTANDING) AND x___ TRADE CREDITORS (BILLS THE COMPANY I IN QUESTION HAS YET TO PAY). '2,‘ ' V 'II: I-—""I r‘ "l '3 -vnIvli~‘1¢): 'ILT
  17. 17. DIFFERENT PROVIDERS FOR SMES IN THE MARKET DESPITE THE LARGE NUMBERS OF PROVIDERS OF WORKING CAPITAL FINANCE, THERE IS LIMITED COMPETITION ON PRICING AND STRUCTURE OF FACTORING FACILITIES, PRIMARILY BECAUSE ALL THEIR FUNDING COMES FROM THE SAME CAPITAL PROVIDERS (THE COMMERCIAL FINANCE DIVISIONS OF THE MAJOR HIGH STREET BANKS). THERE IS SOME COMPETITION ON SERVICE BETWEEN THE INDEPENDENTS, BUT ONCE A COMPANY HAS SIGNED UP FOR 18 MONTHS, THERE ARE SIGNIFICANT SWITCHING COSTS, AND THE FACTOR EFFECTIVELY HOLDS A MONOPOLY OVER THE BUSINESS. @‘IEzMERcHAN1' <_ ADvISORS Efififii i§EEI ERIE KERR I _ HERE A HIWIIIM NI: I1E§R@: :: A : ::: E§E””: :: "fig; nun: I III! I. .. 35“ I33?-IITW mum T IIII llll . ... WWI? EEEB fin‘ IF 533:: HI: I ‘H: 3:: "E" ‘TI ' - HERE H117 "" I HI: “W "TI m: ::: = i I : ::: =-': ::“mMén "E H": F H. .. ? ... E§H§xaI! J5 fifl. ... |1— M I -jmlnfigflfl-EEEE I M5555: j: I : ::: -= :;; mmIr. .‘Z‘§§ Ii Em. ... : A : ::: —'—uumEE§E””“ “Z” III! -2- M "" "E III! “as IT‘ Efillllj T. IIII . :.. ..flEEfinsIIR I ""'*' M “H = |!E§¥fi§'[§[E[§'”HK Ema“ ~. nun ““5"K
  18. 18. CAI‘! HELP SMES MERCHANT ADVISORS IS VERY DIFFERENT TO THE MAIN SHORT TERM SOURCE OF WORKING CAPITAL FINANCE, FACTORING. OUR THREE MAIN ADVANTAGES ARE FLEXIBILITY, COST AND SCOPE. IN TERMS OF FLEXIBILITY, USING MERCHANT ADVISORS YOU SELL THE INVOICES THAT YOU WANT, WHEN YOU WANT UNLIKE TRADITIONAL INVOICE DISCOUNTING, THERE IS NO OBLIGATION TO DISCOUNT YOUR ENTIRE DEBTOR LEDGER I N0 LENGTHY LOCK-IN PERIODS MERCHANT ADVISORS PUTS YOU BACK IN CONTROL OF YOUR CASH FLOW AS WE PROVIDE A SOLUTION TO LATE PAYMENTS. GOOD CREDIT MANAGEMENT IS ABSOLUTELY NECESSARY FOR A SMALL GROWING BUSINESS HOWEVER LATE PAYMENTS ARE FACT OF LIFE EVEN FOR THE BEST-RUN BUSINESSES. WE SEE OURSELVES AS PROVIDING THOSE WELL-RUN BUSINESSES WITHWORKING CAPITAL AND CASH FLOW SOLUTIONS, AN AREA WHICH HASN’T BEEN SATISFACTORILY FILLED BY EXISTING PLAYERS IN THE MARKET.
  19. 19. FUNDING SOLUTION THAT WORKS FOR YOU AT MERCHANT ADVISORS, WE HAVE DELIVERED MILLIONS OF DOLLARS TO SMALL BUSINESSES IN WORKING CAPITAL LOANS. WE HAVE ASSISTED ALMOST ALL INDUSTRY TYPES: SOME INCLUDE MANUFACTURING, TRANSPORTATION, ARCHITECTURAL, PUBLISHING, RETAIL AND MANY MORE. WE WILL WORK WITH YOU FROM START TO FINISH IN ORDER TO UNDERSTAND THE UNIQUE CHALLENGES FACING YOUR BUSINESS, SHAPING YOUR WORKING CAPITAL NEEDS AND FORMING A FUNDING PLAN THAT CAN GROW ALONG WITH YOUR BUSINESS.

×