In this Communique, Capital Corp Merchant Banking will take a look at an aspect of the business world that has expanded to the point where its traditional predecessors are slowly becoming second fiddle.E-Marketing can be easily defined as electronic marketing whereby the application of the marketing principles is delivered over electronic media and in particularly, the Internet. E-marketing is oft ... [
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Asset-based funding is where the funding outlaid to a third-party is secured by an asset. In example, Capital Corp Merchant Banking would disburse funding to a group and secures an asset with a mortgage till the funding is paid in full. Should the company default on its obligations during funding then the asset would be foreclosed.Asset-based lending is commonly offered by a variety of ... [
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To round out Capital Corp Merchant Banking’s Communiqué series on Ways to Reduce Business Debt, the last method is to actually Exit the Business altogether.Certainly this path to reducing one's debt can be the least desirable but under certain circumstances it is inevitable. Luckily there are some options:• The most common would be to sell off all the business asse ... [
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In continuing with the Capital Corp Merchant Banking Communiqué series that outlines possible or practical ways that may change / reduce the amount of debt a business carries, the following will detail the technique of Restructuring Liabilities.By definition, the liability a company has is the combination of what is owed to others and generally in the form of cash or money. The particular part or ... [
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Following one of our recent Communiqués discussing motion picture financing and its stages, there has been requests to explain in fuller detail the first stage of the motion picture process, specifically development.The most important part of this stage is for the developer of the motion picture (i.e. producer) to find an idea for his/her feature film. This plot could either come from previo ... [
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In continuation of Capital Corp Merchant Banking’s initial look into Ways to Reduce Business Debt, the following communiqué delves into different techniques of increasing income levels of the company.There are three basic ways to for a business to increase income and those include: 1) increasing sales, 2) raising the price of the products sold, and 3) seeking alternative streams.Increasing s ... [
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In a past Communiqué, Capital Corp Merchant Banking outlined the stages of motion picture financing. One important stage that we wish to elaborate on further here is distribution and the different options available to have a motion picture financed.One opportunity would be for the studio to which the film was pitched/created to also step in to distribute the film to their affiliated distribu ... [
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On our website, we have a section titled "Types of Projects That Can Be Funded" that mentions financing for “Motion Pictures," among others. An experienced funding group understands that any motion picture can be broken down into three stages of funding before general audiences get the opportunity to see it.The first stage of a motion picture is the development or ... [
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For this particular Communiqué, we turn the focus to defining tried and true manners or practices that assist in the process of reducing the amount of debt held by a company.Business debt is for the most part something that the majority of businesses (mainly Start-ups) have as company and proprietor are not cash-rich and therefore need to borrow in order for the business to grow. The problems begi ... [
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Once our Analysts have completed the review of any given client's documents (or introducer's client's documents) and give it a positive review, before presenting the project to our Executive Committee we expect our clients and introducers to have read and agreed with the following:If this process is understood and accepted by the client(s) and introducer(s), we move forward with the re ... [
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In the prior two communiqués of this three-part series, Capital Corp Merchant Banking defined and discussed those “Flations” that are most commonly known to those in and out of the financial world.The third and least known 'flation', Stagflation, is the combination of high inflation and high unemployment accompanied with slow economic growth - an economic situation that is gene ... [
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It has been presented in previous Communiqués that one requirement of obtaining financing from Capital Corp Merchant Banking is to procure a Viability Report of the particular project as this report would confirm its economical viability.There are, however, times when the promoter(s) of a project is unfamiliar with the Viability Report term and compares it to that of a Feasibility Study. &nbs ... [
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In a communiqué not too long ago, Capital Corp Merchant Banking discussed the economical situation known as Inflation where prices for consumers are increasing. Here, the topic will switch to the opposite of Inflation, which is Deflation.As mentioned, Deflation is the reverse of inflation in that generally consumer prices are on a downward trend that is the effect by the cause of reductions in the ... [
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It has become quite common in these days of economic turmoil to hear and read about companies that are struggling. It is with this understanding that we want to outline a few points that we believe can help someone determine if a company is in fact struggling.The first point to review is the group’s recent financial filings, which will either be readily available or easy to find in pub ... [
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The “Flations” consist of two very common terms: Inflation and Deflation. But within this three-part series, Stagflation will also be discussed. An understanding of each of these terms is important to not only the financial markets but to all individuals as well.When the word Inflation is used, one’s first reaction is that prices are going up. And that is a correct thought ... [
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Previously we have described in detail the three valuation approaches of an Appraisal Report. However, those descriptions centered on real estate being the subject asset and given this, Capital Corp Merchant Banking feels it is imperative to also briefly discuss those approaches in regards to a business valuation.The income approach for business valuation is the same fundamental calculation ... [
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Many of the projects for funding that we receive here at Capital Corp may be within the same industry, while others may be completely unique. In both cases, a factor that can at times assist in the decision-making process is if there is the existence of a competitive advantage.By definition, a Competitive Advantage is an idea, product, or other condition that is not easily duplicated by the compet ... [
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The second Appraisal Report valuation approach that will be discussed here is the Sales Approach, which is based upon the idea that an individual and/or investor would not pay more for a certain asset based on comparable offerings.The sales approach understands that a buyer is looking to pay the least cost for a property or asset that meets both his/her wants and needs. Hence the appraiser w ... [
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As Capital Corp Merchant Banking Inc has discussed in previous communiqués about the nature of and status quo within the renewable energy industry, it is equally important to understand the opposite situation - that is, the nonrenewable energy industry.Simply defined, nonrenewable energy consists of those resources that have an economic value but are not readily replaceable by nature at the same r ... [
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The final valuation approach that would like to be discussed by Capital Corp Merchant Banking is the Cost Approach. This approach assumes that no buyer will pay more for an asset than it would cost to build its equal.The first step of the cost approach would be to determine the site value, likely by the sales or income approach previously discussed. Thereafter the improvements to the s ... [
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Here at Capital Corp Merchant Banking Inc., we come across numerous projects that are associated with the Renewable Energy Industry, where such 'green' methods of generating electricity as solar, wind, municipal solid waste, geothermal, feedstock or various other techniques are used.Given such, it is important to remain abreast of the current industry details.In fact, during a recent confe ... [
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The initial Appraisal Report valuation approach that we would like to expound on in this Communique is the Income Approach, which is based upon estimating the future value/income produced from real estate, a business, or other asset. In theory the present value of that future income stream is what the investor should be willing to pay to acquire the real estate or business. This presen ... [
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A diseconomy of scale is a financial term that is not as commonly used as 'economies of scale' but is equally important to understand.By definition it happens when decreases occur in efficiency or upswings in production costs run parallel to the output of an increase in operations. Factors that may lead to this could be ineffective or lack of communication between workers and management, o ... [
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Further to a previous Communiqué in which cash-based accounting was discussed, Capital Corp Merchant Banking will now discuss a second popular method: accrual-based accounting.The primary difference between the two is that revenue in an accrual-based system would be recognized once it is earned and realizable; unlike cash-based, in which revenue is recognized only when cash is received. Expe ... [
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Capital Corp Merchant Banking has built a history of repeat clients over the years but for the most part many of CCMB’s clients are new and not familiar with the polices and procedures put forth.In this forum the topic of the fees charged by Capital Corp Merchant Banking has been briefly discussed, but given that such is more often than not asked in initial discussions with potentials client ... [
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There are a set of rules followed by accountants to determine how income and expenses are recorded for presentation. Capital Corp Merchant Banking believes it would be important to briefly discuss the two most popular: (1) cash-based, in this Communiqué; and (2) accrual-based, in a future Communiqué.In simple terms, cash-based accounting is where income is presented when it is re ... [
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Economic Cycle (Recession)The last phase of Capital Corp Merchant Banking’s discussion of the Economic Cycle is the period of Recession.Recession is defined as a significant decline in activity across the economy lasting longer than a few months. Similar to the previous discussion of Contraction, a Recession will last longer than a few months until an unknown time.A recession is much more v ... [
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In previous Communiqués, a variety of topics have been discussed, including borrowings from banks to commercial paper. It is important to re-address those topics as they are part of short-term borrowings which has been proposed for further definition in recent months.Short-term borrowings are current liabilities due for re-payment in one year or less. Some examples of short-term borrow ... [
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In a previous Capital Corp Merchant Banking Communiqué the concept of economic value added or the value above the return expected by investors was discussed. Here Capital Corp Merchant Banking wishes to also address another measure of shareholder value, namely market value added (MVA). MVA is determined by assessing the difference between market value of the company to that of the amount of ... [
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Further to Capital Corp Merchant Banking’s discussion of the Expansion portion of the Economic Cycle, the following will look at the next phase: Prosperity.Coming after a period of economic growth or expansion, prosperity is a time where the economy has a nearly full employment rate, prices are increasing, and inflation is relatively high.Representative time periods would be the “Roari ... [
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