To maintain pace with the evolution of the marketplace over the past several decades, the finance industry has changed dramatically, and the rate of change won’t abate any time soon. Finance companies have had to streamline their operations while developing new products and services to meet the needs of their customers and solve the changing problems of business.
Similar to the way that personal computers have evolved over the past 30 years or so, it wasn’t that long ago when leasing equipment was a novel approach to acquiring equipment. Once it became clear that leasing was a viable alternative, the concept took hold and began to evolve, right along with the customers who were using it.
In the early days of lease financing, when the finance companies and customers were both learning the leasing ropes, each equipment transaction was a standalone event. Customers worked with their equipment vendor, decided what they wanted, and then considered leasing as one of several possible payment methods. Lease rates were the primary decision criteria, and leasing itself was essentially a commodity process.
Over time, however, leasing companies have become experts at fashioning leases into powerful business tools. Today, a lease can become a strategic business advantage as opposed to merely a commoditized means of acquiring needed equipment. The knowledge of how to strategically deploy a lease has become a valuable addition to a leasing company’s portfolio.
Apart from that, equipment finance companies can no longer focus on funding individual or isolated transactions. They must instead seek to build long-lasting customer relationships that grow and expand based on mutual trust and a solid exchange of value. These companies now offer comprehensive solutions that span not only the entire lifecycle of the equipment but also include a full range of services and related consumables.
To take full advantage of these changes, customers should take advantage of the new model for acquiring and funding new equipment. It’s no longer a matter of comparing rates from several different companies and then selecting the lowest one. What’s far more important is to evaluate the total value that a finance company can provide across the entire equipment acquisition spectrum, from the original quote all the way through final retirement of the equipment.
The equipment finance industry has developed a broad range of expertise in packaging turnkey equipment financing solutions that can help customers to solve a wide array of business problems. This kind of expertise is invaluable in not only helping customers to optimize the value of the equipment they acquire but also to accelerate sales, streamline operations, and improve the profitability of their businesses.
Another change that has taken place in the equipment finance industry is the elimination of the “one-size-fits-all” approach. Successful finance companies now offer highly flexible financing programs that can be tailored to an individual customer’s specific needs and budget requirements. Customers are realizing that by combining this kind of flexibility with solutions-based expertise, a financing company can become a value-added partner instead of a commodity service provider.
Today, business customers should not only expect but should demand extended value from their financing partners. Full-service, value-added, customer-focused financing is the new reality.