D&H has introduced new extended credit options designed to help partners get needed technology into the hands of cash-strapped end users reeling from the economic effects of the coronavirus pandemic.
The new programs are the latest addition to series of offerings the distributor is using to help SMB resellers shore up cash flow, which include awarding $50 million of increased credit to 200 channel pros during the month of March alone.
“They’re having challenges in serving their customers who have had to close their doors, and so they need help with working capital and financing,” says Peter DiMarco, D&H’s vice president of VAR sales.
One of the new programs, delivered in collaboration with DLL Group and an additional, unnamed finance partner, grants 60-day terms to all resellers who meet standard qualifications, versus the 30 days offered previously. A second program with Lenovo changes earlier 60-day terms to 90 days. Both options are available for all orders placed through June, and possibly longer.
“We’re absolutely open to looking at extending it,” notes DiMarco. “That’s based on the requirements and the status of where DLL is at in this program.”
The new programs unveiled today supplement ongoing efforts to help resellers meet financing needs. Those include the rollout of more than $180 million in added credit since the start of D&H’s fiscal year last May, including $21 million last November. According to DiMarco, the $50 million added last month is a significant acceleration of that credit expansion inspired by the COVID-19 crisis.
“Our existing program had a wide scope to it, and what we did in March was even wider because of just some of the challenges,” he says.
Other previously available financing options from D&H include its leasing program, its device-as-a-service program, and its assignment of funds program, which allows partners to close big-ticket deals without securing a loan.
“It works really well for a smaller reseller,” DiMarco says. “They’re not having to go to a bank to borrow money for a large transaction and incur interest fees.”
D&H is likely to make additional credit available to partners in the months ahead, he continues.
“I would expect that there’s going to be additional need as, God willing, the entire channel and all of us comes out of the virus period and moves into a period of the business coming back and us all getting healthier,” DiMarco says.
As ChannelPro reported earlier based on a conversation with Co-President Dan Schwab, D&H has been easing credit on a customized basis for partners since well before this week.
“We’ve got to be flexible,” DiMarco says. “We have a lot more people from our credit team that are working with partners today to provide more flexible terms.”
Schwab, in that earlier interview, predicted easier access to laptops, monitors, webcams, and other remote work gear now in huge demand thanks to widespread “stay-at-home” orders as soon as mid-April. According to DiMarco, D&H is making progress toward that goal.
“Our inventory levels increase every day as production increases in factories overseas,” he says. “We’re starting to see more availability in product.”
DiMarco’s daily video calls with resellers reveal a wide range of impacts from the coronavirus outbreak. So far, he says, partners well along the journey from older transaction-based business models to models emphasizing managed services and recurring revenue have fared relatively well, as have partners with big, diversified customer bases.
“If you’ve got a large amount of customers, there could be a small percentage that are not operating right now but a bigger percentage that are operating,” DiMarco observes. “The law of big numbers is really helping them.”
Many distributors and manufacturers have announced finance and credit initiatives in recent weeks, including Ingram Micro, Lenovo, HP, and Hewlett Packard Enterprise.
