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Combatting deal slippage in the channel

Rene Stuiver, Finance Solutions Manager EMEA, Tech Data has some advice for those facing this channel problem

With the current pace of technological change, partners are presented with a fantastic opportunity to grow their businesses. However, this isn’t without certain financial challenges. Whilst the IT industry has typically been good at providing credit, it’s becoming too commonplace that the traditional financial mechanisms upon which the industry has operated are failing those in the channel.

There will be many who are familiar with this challenge. How often have we heard stories about customers who, whilst excited about the technology and the benefits it could bring to their business, are limited by getting the budget signed off. When such situations arise, it isn’t uncommon for a deal to slip from one month to the next, preventing customers from taking advantage of digital transformation and, of course, impacting sales and partner business growth.

The challenge demands a more flexible approach. The manner in which we consume our IT has changed profoundly in the past 12 months, with as-a-Service models now commonplace across the industry and, as such, the manner in which we finance these deals must change too. Instead of paying back the credit on an IT asset whose value is in constant depreciation, models that allow for the lease or rent of an IT solution for a fixed price allow customers to take advantage of the latest technologies whilst paying less.

The impact of such models can be profound. Not only does it make budgeting simpler and more predictable for customers, it also frees up liquidity. This is crucial for businesses of all sizes who are looking to maximise their competitiveness and also provide a buffer that will help them weather any uncertainty in the marketplace – crucial as we reach the sharp end of the Brexit negotiations.

Of course, seeking credit without the advice of specialist help is foolhardy at best. Given that traditional methods of finance are failing exactly because of the changing nature of the IT industry landscape, consulting a finance expert who can help you find the most suitable model for each individual deal is not only diligent but necessary. Partners that take the time to do this will not only help their customers find the most appropriate deal, but they’ll also help fuel their own business growth. Over many years as a trusted partner of Financial Services to the IT channel, Tech Data has witnessed this first-hand time and again.

Recent months have seen the launch of a number of finance solutions from vendors and distributors which offer considerable amounts of flexibility. It’s now incumbent on the channel to seek to make the best use of these solutions and seek the correct help in doing so. If partners achieve this, we can expect to see the continuing development and deployment of the technologies that are set to transform our factories, schools, transport networks and cities.

If there are any channel partners out there struggling with this, our message to them is don’t struggle.

This was last published in November 2018

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