IBM > Case Studies > Driving Sales with Flexible Customer Financing Offerings: A Case Study on Avnet Technology Solutions

Driving Sales with Flexible Customer Financing Offerings: A Case Study on Avnet Technology Solutions

Technology Category

Infrastructure as a Service (IaaS) - Private Cloud
Networks & Connectivity - NFC

Applicable Industries

Finance & Insurance
Telecommunications

Applicable Functions

Logistics & Transportation
Sales & Marketing

Use Cases

Last Mile Delivery
Leasing Finance Automation

Services

Cloud Planning, Design & Implementation Services

About The Customer

Avnet Technology Solutions is a company that connects IBM and other suppliers with thousands of resellers, including value-added resellers (VARs), independent software vendors (ISVs), and system integrators. For many years, the company’s Avnet Finance Solutions department has helped resellers better manage their working capital using commercial financing solutions from IBM Global Financing. They provide inventory, receivables, and other offerings to IBM Business Partners purchasing IBM products and services for resale. They also help approved Avnet customers finance their IT solutions through IBM Global Financing using competitively priced loans and leases with extended, multiyear payment terms.

The Challenge

Avnet Technology Solutions, a specialist in the Benelux region of Europe, was seeking to offer new customer financing solutions. The company wanted to provide tailor-made financing packages to resellers who were looking to adopt a managed service provider model and other end users who were seeking affordable ways to adopt analytics, mobile, and cloud-based technologies. The challenge was to find a way to accommodate these needs without putting their own working capital at risk. They also saw an opportunity to increase sales and customer satisfaction by expanding their finance solutions portfolio to include customer financing offerings.

The Solution

Avnet teamed up with IBM Global Financing to evolve its financing strategy to include flexible credit, financing, and leasing solutions for end users. They used the IBM Rapid Financing application to quickly create affordable, flexible payment plans to include in sales proposals. This allowed them to capitalize on their established relationships with customers and prospects to further fine-tune contractual terms and conditions and close deals. The company also expanded this initiative into other countries in Europe. By teaming with IBM Global Financing, Avnet was able to boost sales while optimizing working capital across the distribution chain. They enhanced their portfolio with customizable lease and loan options for end users, driving record sales volumes in the Benelux region in early 2015.

Operational Impact

Avnet was able to increase satisfaction among customers by helping them quickly and cost-efficiently evolve their IT systems to support growth. In one instance, they were able to help a reseller deliver new monitoring and other IT services to an end user through a private cloud environment by financing its investments with a lease and loan solution from IBM. This resulted in fulfilling both the reseller’s and end customer’s needs and winning the deal for Avnet. The successful introduction of customer financing solutions in the Benelux region led to the expansion of this initiative into other countries in Europe.

Quantitative Benefit

5-day improvement in the company’s days sales outstanding (DSO) metric for the Benelux region
Boosted sales volumes with new innovative and flexible financing options for resellers and their customers
Reduced its days sales outstanding (DSO) metric by four days when using IBM commercial financing offerings