Six things to look for in an ideal finance partner

#1 – How is your financing contract performing? You’ve worked hard with the financing partner to hammer out the T&Cs and to establish a service level agreement (SLA). But is the business flowing through as expected? Using their smart finance platform, the financing partner should be able to give a quick answer to any queries that your procurement, finance or general management pose.

#2 – What’s your direction of travel? This is where the financing partner can tell you what’s hot and what’s not in your product portfolio – essential business intelligence. They will be able to give you a breakdown by product, by sector, by sales team, and so on. They’ll help you prioritise sales effort and tell you if any segments are eroding your margins.

#3 – Are there any exceptions? This is where the financing partner spots exceptional patterns – whether adverse events or short terms opportunities – so you can act quickly. Financing data provides triggers to investigate why exceptions are occurring, such as: a competitor’s introductory discount campaign that’s eating into your sales; or an economic event that’s slowing investment; or where demand for a product is going into decline because of a technology phase shift.

#4 – What should you worry about? Here the financing partner is raising more long-term issues that may affect your business – possible future shocks. A good example would be if sales were being written with over-generous nonguaranteed residual values. Although this helps reduce the upfront cost to the end customer, if the residual values are unrealistic, this will leave the vendor with a liability further down the line. The financing partner will be able to give early warning to prevent this scenario from happening.

#5 – How do you compare? Are you behind or ahead of the competition? Where the financing partner has an extensive vendor base, they can give you extremely useful benchmarking reports. You won’t be able to learn about individual competitors, but you will know the average, as well as the best- and worst-performing range. This is key to intelligent sales performance management.

#6 – What’s coming over the horizon? Your financing partner should be providing you with specialist knowledge and advice about any financing and regulatory changes that may affect your business and/or your customers. A good example is updates on legislative changes, such as the international accounting standard IFRS16, which dictates that all lease commitments are now on-balance-sheet.

Picking the right financing partner can make all the difference for office technology vendors - surviving the crisis and thriving thereafter, especially at a time when digitalisation has taken a leap as companies adjust to the ‘new normal’. A smart financing partner provides business intelligence that really helps a vendor build their business.