Microsoft Broadens Financing Options for VARs

Microsoft becomes the latest vendor to loosen credit and financing restraints for partners and customers to stimulate new sales.

February 23, 2009
By

Lynn Haber

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Vendors, channel partners, customers – who isn’t worried about cash flow?

 Microsoft (NASDAQ:MSFT) is the latest vendor urging channel partners to mix its financing options into the customers' sales conversation. What’s good for the customer is also good for the channel partner who gets paid upfront for the transaction.

Microsoft's SmartPay plan, for example, applicable to purchases made by June 30th, allows partners to offer a zero payment option for six months when they use Microsoft financing. All Microsoft products and licenses are eligible; so are partner services and other products required as part of the total IT solution.

Another recent financing promotion, good through March 20th, is a zero percent financing option for new Microsoft Dynamics ERP and new Dynamics CRM customers. Microsoft also continues to offer its Total Solutions Financing Program that enables Microsoft certified partner customers to finance the entire cost of their technology purchase.

Financing Options

Selling products across Microsoft’s Dynamics brand, Fullscope Inc., Athens, Alabama, a Microsoft Gold Certified Partner, views Microsoft financing options as an important piece of the puzzle for sales transactions. “Both SmartPay and 0% financing for Dynamics are attractive deals for our customers,” said Steve Reed, vice president of sales and marketing at Fullscope.

Fullscope made financing a part of the sales and marketing conversation before the economic downturn, outlining finance options to customers at least 90 percent of the time, according to Reed." There's definitely more of an interest in having the conversation today versus a year ago,” he said.

He noted that Microsoft partners benefit as well. “We’re getting paid upfront, including products and services."

With money in hand, channel partners have an easier time managing cash flow and paying their own bills.

“Not only does it improve my business rating, but I’m not working off of past business to pay off present-day costs,” said George LaVenture, president of Trinity Consulting Inc., a Microsoft Gold Certified Partner located in Marlborough, Mass.

For LaVenture’s customers, “Microsoft Financing can help them achieve bigger productivity improvements and meet strategic goals, all on a small annual budget,” he noted.

Popular Financing

Established in 2005, Microsoft Financing continues to roll out new programs as well as expand its finance offerings worldwide. Microsoft also stated that recently, there has been an uptake in Microsoft Financing offers by all types and sizes of business. The company doesn’t release numbers on vendor or reseller participation in its financing programs.

In early December the vendor also introduced four new channel programs to help partners free up working capital. These include extended payment terms of up to 30 days at zero percent interest; limited protection against currency devaluation; early payment discounts for channel partners who opt to pay their invoices early; and price protection  on the foreign exchange rate during a partner's payment terms.

 

TAGS: services,Microsoft,marketing,financing,VARs



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