Corporate Finance in Atlantic Canada

Commentary on corporate finance issues for small- & mid-market private companies in Atlantic Canada

Archive for March 2020

Financing steps for business in this crisis

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Here are some financing action steps we recommend for small and medium size businesses (SMEs) during this economic crisis:

  1. Proactively talk to your banker about the near-term impacts on your cash flow.  To be clear, there is capital in the system to lend to SMEs (particularly with BDC and EDC, given the govt announcements), but no banker wants to hear ‘silence’ from you the SME business owner.  Start the conversation now!
  2. If you don’t have one, immediately start on a weekly cash flow forecast, particularly around working capital (receivables versus payables).  You (and your banker) need visibility as to short term cash flow needs, including when (and how much) of an increase in your operating line you may need.
  3. Talk to your insurance broker (and an accountant experienced in this topic) about your business interruption (BI) insurance coverage.  BI is much more complex than compensating you for lost sales, so get advice on what is covered (and when an advance could be possible).
  4. Explore non-borrowing cash flow resources.  For example, the federal govt just announced that you can immediately reduce your payroll remittances for the 10% “wage subsidy” if you pay employees during a shutdown (subject to limits per employee and per business).  Also, you can now delay income tax payments and instalments until September (without interest or penalty).

Be proactive and your business will survive.  Be safe.

Written by Dan Jennings

March 19, 2020 at 11:27 am

Posted in CF Musings

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Kefi Travel acquires Canadvac Travel

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NB news service Huddle published a news release today about Saint John, NB’s Kefi Travel acquiring Chester, NS-based Canadvac Travel.

Canadvac is a receptive (i.e. inbound) tour operator focused on European visitors to Canada, while Kefi is a personalized/customized travel operator. 

Written by Dan Jennings

March 8, 2020 at 7:10 pm