Why offer your clients a Finance Option

Do you currently work with a finance partner to offer your clients a finance option ?

Some replies we often get from IT Vendors:-

1. "All our clients are large, blue chip companies, who don't need finance" - Due to the considerable tax benefits associated with leasing (making it cheaper than paying cash), 89% of Times Top 100 companies are now leasing their IT Equipment.

2. "Our clients always pay cash" - Great, but do you actually see their cheque when it comes in ? - Often they are using a finance company without you realising and the delay in you getting the order is actually due to the client trying to source the finance. Also, Do you get the cash the same day you deliver the equipment ? Are you waiting 30 days or more for your money ? Do you have to handle payment and collection issues ?

3. " There's no requirement for finance from our clients as they never ask us for financing" - That's because most companies still don't realise that you can finance software ! Their banks/finance companies will happily finance their cars and machinery, and maybe even their Hardware, but as most lenders won't consider funding software, many companies still don't realise that it can be done.

4. " We offer the manufacturers recommended finance scheme" - So you're a Reseller, selling the same products as your competitors and offering the same finance scheme ? Wouldn't you like another way to differentiate your offering ?

Aside from the obvious benefits to the client (including the tax benefit), you will benefit from:-

* Accelerated ROI - It's easy to demonstrate this through the client paying for the system on a pay as you use scenario
* Shorter Sales Cycle - By bypassing budgetary constraints and offering a monthly option, many FD's are able to sign this off without having to get board approval
* Increased Sales - By simply making the product more affordable, you will win more business and clients will be able to order more product from you
* Increased Profit - Clients are less likely to ask for discounts when offered a monthly payment rather than a large lump sum.
* Faster cash - You will be paid within 24 hours of the client installation


Mike Boss is the Managing Partner of The Boss Corporation, one of the UK's leading independent provider of IT finance. The Boss Corporation specialize in the provision of IT finance, including Software transactions. They also work with Software Houses and Resellers enabling them to offer a bespoke client financing option.

10 useful points to consider before signing a finance agreement

We have often seen clients coming back to us for funding, having tempted by offers from other companies, which aren't quite all they seem.

Therefore, we have put together a list of 10 basic tips that should always be considered:-

1. When comparing quotes from different lenders, always ensure the payment profile is the same, ie. number of payments paid upfront, as this affects the rate greatly.

2. Always keep a record of when the first and last payments are due to be made.

3. If the agreement is a finance lease, write to the funder / broker one month before the end of the agreement confirming your end of term wishes.

4. With any finance agreement, always ask the lender to confirm the end of term title fees in writing before you sign the agreement. Make sure there are no other "Residual" or "Balloon" payments due by you

5. When comparing rates, compare the total amount of interest payable. Different lenders have different methods to calculate their published rates.

6. Due to the considerable tax benefits, leasing can work out cheaper than paying cash.

7. Always ensure the schedule of equipment matches that of the equipment you are buying.

8. Brokers can save you time and money as they have access to a number of lenders and often can obtain better rates than single customers.

9. Leasing makes it easier to keep pace with technology - Most Leases have built in upgrade paths meaning you are able to keep up with technology, without always increasing your monthly payments.

10. Finally, if a supplier is offering an interest free deal, yet you still want to pay cash, ask for the discount to be given to you instead of the finance company.

Mike Boss is the Managing Partner of The Boss Corporation, one of the UK's leading independent provider of IT finance. The Boss Corporation specialize in the provision of IT finance, including Software transactions. They also work with Software Houses and Resellers enabling them to offer a bespoke client financing option.