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VOX POP
38
PITR:
As reported in last month’s
issue, the improved economy
has changed the lending climate.
According to the Finance & Leasing
Association (FLA), IT equipment
finance was up 53% year-on-year
in the first quarter of this year,
with March showing £3.1 billion of
new business, the highest monthly
total since September 2008. Are
you finding finance easier to secure
and has this helped support growth
within your business and made it
easier to win new business?
Mark Smyth:
“Finance for technology and
services continues to be a challenge, with
banks and finance companies remaining
fairly risk-averse. However, as business
performance and trading improve, we are
starting to see an increase in acceptance
levels.
“We’ve realigned our business mix in
recent years, resulting in strong growth
and renewed economic confidence. This
should see the group continue to meet its
aggressive growth plans for FY2015 and
beyond.”
Wayne Drysdale:
“Thankfully, finance for
customers is getting easier and with clear
transparent finance providers who trust
suppliers such as ePrint Digital to fund a
deal the correct way, financing machines is
growing at a good rate.
“This is helping us to win bigger deals
with larger customers who are comfortable
with the deals provided. Being able to
offer the correct finance deal is making
it easier to win new business. The hard
part is when the customer has had a poor
experience with a previous supplier and
huge settlements sometimes come into
play. So far this year we have managed to
get more finance deals arranged for both
established businesses and new start-ups,
so the finance of business equipment as a
whole seems to be growing again.”
Matt Goodall:
“As a company, we have
been fortunate to partner with Grenke
Leasing and their approach to leasing
has allowed us to offer finance to many
companies. It is less common now than
it was three years ago to find companies
that are struggling or are late with their
accounts.
“As is always the case with finance,
each customer has to be evaluated on a
case-by-case basis. Although finance is
easier to secure, we have also seen an
increase in customers self-financing or
buying equipment.”
Sam Elphick:
“I would definitely say that
over the last year it has become easier
to secure finance through a number of
the lenders that we work closely with.
In the last 12 months, we have supplied
a number of start-up firms with IT
equipment and found it surprisingly easy
to finance the deals. Sometimes there
may be instances where further checks or
guarantees are required, but on the whole,
our experience supports the findings of
the FLA.
“We always explain to potential
customers that financing print devices
is of benefit to their business, as print
equipment is a depreciating asset. For
other IT hardware, such as PCs, servers
etc., we offer a cash price as well as a
finance option, which obviously helps the
customer in terms of cash flow etc.”
Bruce Davie:
“The majority of our business
is financed. While it is a key enabler to
doing business, we have never had an
issue obtaining finance. If the economic
climate has improved, we have not been
affected by this change.”
Andrew Jones:
“On the whole,
underwriting restrictions and the lack of
willingness by leasing companies to fund
deals during the recession appear to have
lifted. We are experiencing a great increase
in acceptances by the mainstream funders
and those deals that still don’t tick all the
boxes are generally being accepted via our
brokers. Off the back of our 2015 hardware
sales, we are increasing the number of
internally financed deals and will continue
to develop our own rental portfolio. This
reduces our reliance on outside funding
and enables us to win new business by
offering a complete in-house service, from
supply to service to finance.”
Gary Downey
,
Group Marketing Director,
Balreed:
“We have made a very strong
start to 2015, with many business leaders
taking a more assured stance in their
investment decisions and moving their
organisations forward, which is always
welcome. But we haven’t seen a relation
between this and accessibility to financing.
Although a number of our finance partners
have loosened their vetting criteria to some
degree, this hasn’t generated a noticeable
upturn as yet. And we are experiencing
increasing demand from larger clients, who
are less restricted in this area, so that has
reduced our exposure.”
Derek Russell
: “Good question. Lenders’
funding criteria are still quite stringent and
there’s no doubt that finance is still hard to
secure compared to how it used to be. That
said, in the main, finance providers are
looking on new proposals more positively
and, as the UK comes out of the recession,
improved access to finance to support
business development is helping many
organisations succeed in growing their
business.
“Our experience is that funders are
much more thorough then in pre-recession
days. They are adopting a more cautious
approach when reviewing how a proposal
is structured, especially when looking at
any third-party settlements that form part
of a deal. In the past, this element wasn’t
really a key factor, as long as the deal
overall was worthy.
“Lenders are now exerting extra
caution and ensuring that deals are
commercially viable for all partners – the
client, the dealer and the finance business.
They are definitely much more strategic in
their decision-making now, but also much
more positive than five years ago. Then,
RDT was looking at a 55-60% acceptance
rate, whereas now we’re seeing 80-85% of
deals concluded. That’s playing a key part
in our business growth and helping us to
deliver on our strategy for future growth.”
Although
finance is
easier to
secure, we
have seen
an increase
in customers
self-financing
or buying
equipment.
...continued
Gary Downey,
Group Marketing
Director,
Balreed
