The COVID-19 global health crisis has created challenges that many businesses have never been faced with before. Companies, both small and large, have experienced immense pressure to quickly adapt to the changing needs of their market, employees and customers. As companies across most industries face cash flow and budget concerns, for many, a new challenge is gaining access or allocating capital to acquire technology equipment, software, and services that are essential for running their business and delivering value to customers with limited interruption.
When it comes to investing in technology assets, flexible equipment and software financing options give companies the ability to quickly deploy technology to their employees and improve their overall tech infrastructure. In recent weeks, DLL has seen an influx of inquiries from our vendor and reseller partners regarding payment solutions for laptops, mobile devices, videoconferencing software and network and security solutions to support remote working and virtual classroom capabilities. With the shape of businesses changing so drastically, it is clear that remote work solutions are no longer a “nice to have,” but a “must have.” As a result of this shift in the way we work and learn, IDC anticipates a bump in as-a-service models like PC as a service (PCaaS), device as a service (DaaS), and infrastructure as a service (IaaS), “as customers recognize the benefits of remote support, service and deployment for work from home staff and using opex payment structures to conserve capital.”
Over the last several weeks, a number of technology companies and manufacturers have attracted attention, from both customers and the media, by launching compelling financing solutions. They are driving awareness of the power of flexible payment solutions to offset the capital concerns of their customers and to help them maintain a healthy cashflow. One manufacturer in particular, Cisco, announced a $2.5B Business Resiliency Program to provide access to the needed technology solutions that keep businesses running. Interestingly enough, according to a recent whitepaper by McKinsey & Company, it is expected that companies taking a “through-cycle” view of their relationships with customers and the communities they serve will emerge the strongest. Rather than seeking short-term gains, long-term value can be created through flexible payment terms, unbundling and one-time promotions that address customers’ pain points.
“In the channel space we are seeing our partners and their customers completely shift budgets and revisit their IT priorities,” said Joe Iavarone, Senior Vice President and Head of Program Management & Sales, Americas’ Region for the Tech Solutions Global Business Unit. “Companies have had to quickly pivot and acquire the necessary assets to support working and learning at home. Those that weren’t previously using financing tools have begun to do so. In a pinch, many organizations had to deploy phones and laptops. In order to maximize the device’s ROI, financing was simply the right choice. A great example is hospital systems – they had to get tablets into patient rooms so they could communicate with their families and loved ones while visitation is limited due to the virus. Those device deployments happened quickly, efficiently, and with low monthly payments that preserved cash reserves. According to the Equipment Leasing and Finance Association, IT and Related Technology Services represents nearly 25% of equipment financing new business volume in the United States, making it the top equipment category financed. We anticipate that trend will continue, and potentially rise, over the next year.
“We understand the breadth of challenges just about everyone is facing right now, and at DLL, the customer remains at the center of everything we do,” Joe continued. “We are proud to do our part in supporting our partners and customers by offering flexible payment terms, deferred payments and step payments that help to ease some of the burden.”
At DLL, we remain dedicated to our partnership approach and proud to support our partners, and their customers, throughout these challenging times. If you have any questions about how financing can support your current technology needs, or the needs of your customers, please contact us.