Business Financing February 2012
“Here’s My February 2012 Business Financing Status Report”
We have now gotten to the end of February in 2012 and heading into the last month of quarter one of 2012, so I thought it was a good time to give my two cents on what I’m seeing in the business financing market place.
As a whole, there are certainly more businesses actively looking for money that at the same time last year. At least part of that here in Canada can be attributed to the above average weather, bringing spring and spring optimism out into the open sooner than usual.
And while lenders are getting more active in the market with their promotions and overall marketing activities, there is still more demand and supply for what I would characterize as reasonable risk business deals.
We are also continuing to see the development of a wide variety of sub prime and debt/equity financing models to try and fill the needs of the market place, much of which was vacated by those that failed to survive post 2008 recession.
Global financial markets are still pretty shaky, which has a major trickle down effect to all regional markets, including Canada, where the economy for the most part is still performing fairly well compared to most other parts of the world.
Most significant sources of debt financing will at the very least be drawing some of their capital from global markets, so as the world economy goes, so does the appetites, at least to some degree, of individual country lenders.
The main constant since 2008 is that you need to have your ducks in a row when applying for financing as loose or less than complete financing scenarios will continue to have a hard time attracting capital.
And even if you have a stellar, well rounded out project or internal need to present for financing, it may still take considerable time to get the deal completed and funded. This is especially true with the major banks and front line institutional lenders.
The secondary market also has the luxury of being more selective as they have more deals than they can handle due to the tightening up of lending/funding criteria at the branded banks.
All lenders are still very concerned about their portfolios as not all of the aftermath from the most recent recession has been seen yet.
In general, there appears to be an increase in both demand and supply of business financing and that trend is expected to continue through the spring and summer periods.
Key message though is that if you are going to need business financing in 2012, you need to start the process sooner than later, and you should consider getting some help from an experienced financing consultant to help you navigate your way through a continually changing market place.