Common Problems Office Technology Providers Experience with Leasing Companies
Now more than ever, office technology providers are relying on partners to help meet customer needs. In an effort to remain relevant, many technology providers are evolving their product and service offerings to include IT, Voice-over IP, and even physical security related solutions. This has created need to seek outside expertise.
Anytime you need to seek out an external organization, it’s important to evaluate how they impact the relationship you have with your customer. Bringing in another third-party to service your customers means placing at least part of the customer experience in their hands. That requires a lot of trust.
I’ve spent 13 years in the office technology financing space, which has given me insight into what office technology providers value in a financing source. I hear when solutions providers are wowed by financing providers, and I hear about it when they’ve been disappointed. One question I often hear from prospective customers considering adding or changing leasing partners is, "What problems might I have with ‘X’ financing company?" Rather than pointing out any specific companies, here are a few of the common problems technology providers, resellers, and their customers experience with various leasing sources in the imaging space.
Unfavorable Agreement Terms
When contracts are one-sided or are in favor of the leasing company, this can create problems for you as the solution provider, and your customers. Agreements should clearly communicate expectations, terms, and conditions, while also allowing for flexibility should the agreement need to be amended.
To protect your customer relationships, select a finance company that not only has a track record of integrity and excellence, but is also willing to put its promises to you and your customer in writing. For example, they should be willing to document:
- What fees will be charged (insurance, origination fees, interim rent, processing fees for property taxes, etc.)
- End of term expectations and/or expectations around automatic renewals
- Whether or not there will be proactive notification near the end of the lease term
- The invoice schedule
Limited Billing/Invoicing Capabilities
Many of your customers have complex budgeting or accounts payable reporting that requires non-standard payment allocations. If your financing source can’t accommodate, this can create friction for your end customers. Rather than creating friction for the end customer by making them wrestle with several invoices for service, equipment, supplies, look for a financing source that can deliver a single invoice for all related services. They should have the capability to then remit any costs for the services and supplies back to you as the solution provider.
Additionally, some financing sources may not have the integration capabilities needed to automate processes to increase the accuracy and efficiency of your billing and invoicing. It’s crucial your financing source can provide the right information, reports, and features on an invoice to make it simple for your customers to make payments. A lack of granular detail and transparency can create frustration for both you and your customers.
Lack of Online Payment or Bill Pay Options
Consider what options the financing provider offers to your customers when it comes to paying their bill. Cutting checks costs businesses money. Credit Cards often include fees to process and can add to the end user’s total cost over the life of the contract. ACH withdrawals may help avoid administrative cost and effort. Your finance company should be able to accommodate a number of payment methods and make it easy for you as the provider to facilitate the option that best suits your customers’ processes.
Some finance companies have been known to add separate charges for items that are either not clearly defined, not defined at all, or could be considered excessive in relation to the overall contract obligation. If you’ve been burned by hidden fees as a consumer, you know how that can shake your faith in an organization. Unexpected fees don’t fly with you and they won’t fly with your customers.
Processes that Create Friction and Inefficiencies for You and Your Customers
Many financing companies segment their teams into large departments by function; think credit, funding, documentation, and so on. They organize functionally because it is more cost-effective for them. But when you call in with an issue, instead of having a dedicated team who is familiar with every aspect of your program and account, you spend time providing background information to multiple parties before you can even begin solutioning.
A cross-functional team-based structure enables your leasing partner to learn your business and serve your needs more efficiently.
Inability to Innovate
All businesses need to innovate. Most financing sources provide financing with rate as the only offering Look for a trusted provider that is immersed in your industry and committed to uncovering broader needs that impact the success of your business. This could mean programs or services that help you hire and retain new expertise or supporting your adoption of new product lines or offerings. Technology providers need partners that can pivot as your industry grows beyond standard MFPs and into ancillary products and services, like managed IT services, cybersecurity, document management software, and more recently, thermal scanners and virtual meeting software. There is great opportunity to add more value to the current customers you serve, including those who are struggling to adjust to the recent changes in their work environment. You need innovative partners who are eager and ready to venture into new territory to build solutions that will support any new product and service lines you adopt.
Views on Customer Ownership
Who owns the customer? You as the technology provider, or the leasing company? The answer should be you.
You should be able to trust your business partners to enhance your customer relationships. They should have the integrity not to solicit your customers for upgrades or new business, even if it means a better outcome for them. Their loyalty and mission should be to serve you and they should consider you their most valued asset - the same way you think about your customers. Look for a financing provider that respects and protects the relationship you have with your customers.
Your partners should be an extension of your business and consistently treat your customers with the same exceptional level of care you would. Their processes and capabilities will either enhance or hinder your ability to retain your customers and your overall reputation. If a third-party vendor doesn’t make the grade on any of the above scenarios, you risk losing customers, so be your own advocate and hold a magnifying glass up to their capabilities and values to ensure alignment with your long-term strategy.
Evaluate Prospective Leasing Providers with our Lease & Program Review Checklist:
Ready to take a closer look at your current programs to ensure you’ve selected the right financing provider? Download our Lease & Program Review Checklist. You’ll find a list of items you should watch out for when it comes to your lease agreement and program as a whole.