When we decided to establish our company in 1991,
we were very sure of at least one thing. Based upon
our experience in the industry, there were few, if
any, companies who had the ability to solve the
multitude of different equipment financing and
leasing problems encountered by small, medium and
even large size companies. In other words, one that
was able to provide a wide range of complete,
competitive financing solutions. Solutions for
most types of credit profiles and equipment types
characterized by the equipment financing and leasing
needs of these companies.
Why Did You Say They Can't Do Business With
Us Anymore?
In the mid-1980's, larger companies such as U.S.
Leasing International, were known as premier vendor
sales-aid companies. They developed leasing
programs for companies who sold equipment, like
Wang Laboratories and Kodak, to make it easier for
their customers to continually buy newer and more
expensive equipment. At the same time, they were
poor at directly providing the same middle-market
companies with leasing products for equipment other
than technology, word processing or copiers. They
did not feel the need to try and understand the
salvage value of other types of equipment, or the
credit profiles of companies who bought it. Of
course they were caught short when Kodak and
others formed their own leasing companies and
business suffered accordingly. Many banks and
subsidiaries that provided business loans, did an
excellent job of lease financing on hard assets like
trucks, tractor-trailers or heavy machinery. Asking
them to consider financing a lease for computer
hardware and/or software was a far different story.
They would look at the salesman and the customer
as if they were from Mars, no matter how long they
had been a customer, how well they had paid existing
leases, or how solid their credit was.
The Writing Was On The Wall
As a salesperson or sales manager in these
companies, it was difficult to understand and accept
why a company would turn away good business,
especially from existing customers with solid credit
status. At the same time, it was a good thing,
because it forced me to start to think of alternatives
to offer to these types of customers. A full service
leasing company would offer these companies a wide
range of alternatives. Different options for different
types of transactions. I felt there was a need for the
customer to truly understand the process of leasing
from a tax, financial and documentation standpoint.
In other words, to determine in advance, what they
are legally bound to do as part of this type of
transaction, and all the implications involved, both
good and bad.
What's Wrong With Telling Truth?
My former employers told me many times to tell our
customers that a lot of the fine points in a leasing
transaction and fine print in the documentation were
on a need to know basis. In founding this company,
I believed that customers did need to know before
they signed the documents. Leasing, by definition, is
after all, a non-cancelable contract. As a result, in
1997 - Equipment Funding Resources published a
number of "how to" guides designed to help a
business owner or decision maker obtain the best
leasing terms possible, given their credit profile and
equipment type. In doing so, we took a consultative
approach in dealing with our customers and potential
clients.
So What's The Lesson Here?
By deciding to tell the truth about all aspects of a
leasing transaction to customers and prospects, we
knew we would ultimately sacrifice a part of our
actual leasing business. This is because, frankly,
leasing is not the best financing alternative, for every
business in every circumstance. However, some of
the customers we advised against leasing equipment
(from ourselves or others, for a variety of reasons),
ultimately do come back for further advice or to
actually lease equipment from us. For the long term,
we felt this would be the best way to build trust with
the commercial marketplace and also our business.
What We Do And How We Do It
First and foremost we are in the information
business, because the world has changed into an
information world. If you view the publications
section of the website, you will see the scope of our
"how to" guides and publications. You will also see
what other professionals have to say about them.
Once we determine that leasing is the right way to go
for the customer, we determine the best leasing or
loan product option for their particular needs. The
process begins with credit qualification and
submission to the lender who best matches the
equipment and credit profile of the customer. We
have about thirty different lenders we currently work
with. We do this to obtain the best rates and terms
possible; given those qualifying elements very similar
to what a mortgage broker might do on a real estate
loan.
The Best Thing About Working With Us
Once we qualify your requirements and determine
that leasing is the best option, we can accommodate
a very wide range of different transaction types.
Probably more than any other company in our
industry! Here are some our recent transactions:
- $25,000 lease for musical instruments. These
instruments were then rented out by the
music store to their retail customers.
- $50,000 lease for a mini-mart to upgrade their
POS system and coolers.
- A $ 225,000 lease which was actually the
purchase of equipment and "goodwill"of an
existing restaurant.
- $500,000 "software-only" lease to upgrade the
accounting and billing system for a large non-
profit hospital.
- A million-dollar lease for computer hardware,
software and services upgrade for a security
company.
- $275,000 financing for software package for
an internet based company.
- $675,000 financing of fixtures, furniture and
equipment for restaurant franchises in
Northern California.
- $500,000 line of credit established for security
company to be used for upgrading computer
hardware and software system.
- $250,000 line of credit established for
financing of 54 floor cleaning machines to be
used at 18 retail locations.
- $1,000,000+ funded to a chemical distribution
company for pallet racking, security and
facility fire alarm systems.
- Vendor Program established with large
musical instrument manufacturer &
distributor, providing retail store customers
with financing for their rental inventory.
If you had told me fifteen years ago that doing this
large of variety of transactions was even possible I
would have laughed out loud. Yet over the years this
is the kind of company into which we have evolved.
We think that evolution is good for us, and good for
our customers. I guess you could call that a win-win
situation for all parties concerned. Probably most
gratifying is that we have a very high retention and
repeat business ratio with our clients. Something that
is very hard to find in our industry.
The key to sustained success is our ability to approve
transactions that many others, including banks,
cannot. Transaction dollar size, equipment type
and/or credit challenges rarely stand in the way of a
speedy and painless approval process.
In other words, our clients receive the best rate and
terms for their particular transaction that the
marketplace can offer.
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