Leasing Lessons Add Up
Posted on 14/10/2013
Too many resellers are not taking advantage of leasing, according to distributor Nimans who have their own ‘unique’ financial services division.
“Current trends tend to revolve around changes to finance and operating leases for schools,” explained Head of Dealer Sales, Tom Maxwell. “In addition we are seeing a lot of profiles within the market, based on different quoting methods, in addition to the traditional ‘one plus 59’ monthly scenario.
“It’s the profile of the deal that can reduce the overall monthly premium, which when resellers are quoting against the competition, can give them an advantage. How the deal is worked out is vital.”
He emphasised: “We try and encourage resellers to think outside the box. For example if they suggest a ‘two plus 59’ option they can make the rental lower because the customer is paying a bigger lump sum deposit. Often customers are not perturbed paying a bit more upfront as it reduces their monthly outgoings. From a quoting perspective, keep the monthly premiums as minimal as possible. That’s the key to success. We offer up to seven years finance, one plus 83 for example. It’s perceived to be a more affordable option.”
Tom added: “Hosted solutions are another area of the market influencing the leasing sector. We can also fund hosted solutions such as the end points and also collect the service amounts.”
Leasing in general is ‘very busy’ at the moment, according to Tom. “There’s a lot of competition in the market with many of the main funders back in the market. For us, we are very competitive, have a really great acceptance rate and through our in-house lease desk we take away the pain and alleviate all the hard work for resellers. They don’t need someone in their office spending time going from funder to funder and filling in paperwork. In most cases we will off-set the cost of the kit against the lease agreement, helping the reseller with his cash flow. They can also keep their credit limits intact for non leasing purchases.
“As a business we are collaborating more and the message is getting out there. Nimans offers a unique leasing service because we have our own leasing operation within our business. It’s not a broker acting on our behalf. This gives us greater control and a more individual client service.
“It’s more about what we can include into the lease these days such as software and cabling and installation. This gives resellers the ability to offer leasing for a complete solution. Resellers need to identify what their customer can afford and build it back to a cash price to offer them the most cost effective solution. There are a lot of resellers still not using leasing. Some feel uncomfortable selling it. I’m not quite sure why. Some will never be convinced. But they are missing a valuable trick.
“Leasing helps with their cash flow. They can get money in from deals more quickly and don’t have to worry about liability because once the lease is accepted the funder takes on that risk if the customer goes out of business. Ultimately leasing helps resellers capture more business. The banks are still not lending that much and businesses are always looking for alternative ways to afford a solution rather than depleting their cash reserves. There are also tax advantages to leasing that resellers should be explaining to their customers.”