Developping Vendor Financing Partnerships in IT

Eurolease forum

Richard Gendreau 16th May, 2013

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BNP Paribas Leasing Solutions Global overview

2011 - Ranks 1st in Europe

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BNP Paribas Leasing Solutions An organisation Specialised by Markets

3 International Business Lines to remain close to our client’sand partner’s needs:

Technology Solutions► Specialised in technological assets:

– Office Equipment– IT (hardware, software)– Telecom equipment– Medical

Equipment & Logistics Solutions ► Specialised in professional rolling equipment:

- Farming Machinery, Construction and Public Works equipment, Materials Handling equipment, Light Commercial and Commercial Vehicles.

Bank Leasing Services► Specialised in leasing solutions for Bank’s customers

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Why investigate the IT market for vendor financing ?

Wide market

Attractive from a growth perspective

Tech refresh fits with renting … and thus to a vendor financing model

Why ?

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IT vendor financing - Findings

Information Technology is not ONE market but SEVERAL marketS

Software # Hardware Hardware relates to PCs, Servers, Storage, Printers… Small ticket # Mid / Large ticket Tier 1, tier 2 & tier 3 distribution models

Vendor financing penetration remains weak

_aaS take up PaaS, IaaS, SaaS models…

Findings

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Roadmap will depend upon

Type of partner Manufacturer, Software Editor, Reseller, VAR, Distributor, VAD, Integrator… ?

End user typology Corporate Accounts, Mid Caps, SMEs, Professionals

… Vertical Markets ?

Geography Mature country / Emerging market… or economically depressed?

Roadmap

The IT market represents an attractive opportunity for lessors investing in a vendor finance but it requires1) The implementation of specific structure(s)2) The design and roll out of the right products and services3) A cultural fit

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Wholesale Retail

Partners • Global vendors • Resellers

Ticket size • Mid/Large • Small

Commercial Fronting

• Vendor • Vendor

Vendor relation • Centralized • Decentralized

Product offering• Renting• IPAs

• Leasing• Renting

Client• Mid Market• Large Corporates

• Professionals• SME• Mid Market

IT market(s) segmentation

Referral

• VARs

• Mid

• Lessor

• Coordinated

• Master & Schedules

• SME• Mid Market• Large Corporates

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Wholesale Retail

Key Value Drivers

1) Large coverage

2) International centralised organisation

3) Country SPOCs

1) Sales coverage in the field

2) Strong marketing support

3) Fast & simple processes

Key Success Factors

Top down governance

Large volumes to gain granularity of the portfolio

Structure an efficient and profitable model

Strong sales engagement

Key Performance

Indicators

• Volumes

• SLAs

• Sales penetration

• Risk indicator per partner

• Productivity

Main stakes per market segment

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IT Retail : How Do We Make It Happen...

IT Retail: “Position Leasing as a Sales Aid and Not a Product to Sell”

Make It Easy Training Programme – sales, ops Helpdesk from Origination to Booking Rate Calculators; Lease v Cash Tool On line tool; from Quote to Contract

Increase Awareness Product Promotions Exhibition Support

Help Partners to Add Value to their Customers Co Branding Credit Checks Joint Meetings with Key Customers

Internally Establish Cross Functional Teams Sales, Marketing, Ops, Risk & IT

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IT Wholesale : Global approach

IT Wholesale: “Provide a One Stop Shop”

Need for : Geographical coverage Top Down governance Consistent approach and processes Tailor made structures Operational excellence

Points to note Time to break even “Imperfect” paper Granularity of the portfolio Operating risks

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Software financing : Specific approach

Software financing: “Dispel the Myths that Software cannot be Financed”

Lessor cultural adjustment Credit policies Contractual package Litigation & Recoveries processes

Vendor leasing to progress Financing not in the vendors’ DNA Strategic stance Education & Engagement !

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But also because IT is a fast moving reality

Innovation is crucial need to anticipate: hosted, _aaS,

Service is growing FM, TCO

Adapt constantly difference is blurring between assets

Act local stay close to reality

Think global & implement local !

Momentum

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Vendor financing

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BNP PARIBAS LEASING SOLUTIONSInternational Business Line

Technology Solutions

Richard GENDREAUHead of Partnerships

+33 (0) 6 64 01 39 22 richard.gendreau@bnpparibas.com