With the constantly changing demands in the highly competitive technology industry, the right financing can make or break a channel provider’s ability to take advantage of today’s opportunities.
For Vancouver-based Turning Point Technology Services, flexible financing programs offered by Wells Fargo helped the IT solutions provider experience strong growth over the past two years.
“The nature of our business solutions require hardware and software solutions for medium to large enterprise clients which can be significant in spend,” says Lauren Chan, chief financial officer with Turning Point. The financing program “allows us to drive our rapid growth and provides seamless transactions with our customers.”
Wells Fargo Capital Finance is a familiar name south of the border. In 2016, it bought GE Capital’s Commercial Distribution Finance business, which included its technology portfolio, and expanded its Canadian footprint. Now, it’s bringing its channel financing expertise to business in Canada with solutions to help support evolving technology companies.
Customized financing for the IT channel
“The technology industry is moving so quickly it calls for new financing models to meet customer needs,” says Kristin Godwin, Director, Business development, Wells Fargo Capital Finance Corporation Canada.
One of the most fundamental changes is the shift from on-premises solutions to monthly subscription services. For channel players, this results in a transition to a recurring revenue model. It means that they need to be well-capitalized to bridge the gap from the sale of the solution to the time it is ultimately paid for by the end user.
To ensure a healthy cash flow, Wells Fargo offers a range of financing solutions that can be tailored for each company, says Godwin. This could include vendor-sponsored programs, extended repayment terms or PO financing to match channel end user needs. It also has an accounts receivable purchase program which allows strong public or large private companies to take advantage of our vendor sponsored programs without incurring any additional debt. In addition, Wells Fargo can provide working capital as well as financing for mergers and acquisitions.
Unlike traditional lenders, Wells Fargo’s dedicated technology team will take the time to understand the channel player’s business model, says Godwin. “Our team specializes in the review of technology financial statements. We understand trends and can strategically leverage inventory, receivables and assets to drive financing solutions.”
Farooq Ahmed, Senior Financial Controller with Acrodex Inc., an Edmonton-based Managed IT support and consulting service, says his firm’s long-term relationship with Wells Fargo gives it a distinct competitive advantage.
“We appreciate the relationship as it enables us to grow and enhance our suite of IT offerings to industries across the country.”
Tailored benefits = increased opportunities
Tailored financing programs help channel players increase their working capital and cash flow, and reduce their financing costs, says Godwin. In short, it allows them to pursue bigger opportunities and grow their companies.
“As our financial guide, Wells Fargo Capital Finance has helped us find growth opportunities,” says Paul Cooper, president, Canadian operations, Technology Integration Group. “Leveraging their extended terms and working capital solutions has provided additional liquidity that has allowed us to further expand our business, market share and profitability.”
Wells Fargo also provides its customers with an automated platform to consolidate their accounts payable from different vendors and to produce customized reports on performance.
“We have detailed conversations with our customers to learn about their business and find solutions to fit their needs,” says Godwin. “We’re providing alternatives to traditional lending.”
Join us for a workshop at CDN’s Top 100 Solutions Providers event on April 25 to find out how Wells Fargo can improve your cash flow and grow your business. Register here.
On March 1, 2016, Wells Fargo acquired GE Capital’s Commercial Distribution Finance business. The Wells Fargo Commercial Distribution Finance technology business is now part of Wells Fargo Capital Finance and its Supply Chain Finance business.
© 2017 Wells Fargo Capital Finance. All rights reserved. Products and services require credit approval. Wells Fargo Capital Finance is the trade name for certain asset-based lending services, senior secured lending services, accounts receivable and purchase order finance services, and channel finance services of Wells Fargo & Company and its subsidiaries. Wells Fargo Commercial Distribution Finance is the trade name for certain inventory financing (floor planning) services of Wells Fargo & Company and its subsidiaries., including Wells Fargo Capital Finance Corporation Canada.