Control of the customer relationship is a perennial source of
tension for vendor and financiers, Clive Rendell, principal of
Global Vendor Finance at Banc of America, said during his
conference speech.
In direct lease programmes, funders have direct control of the
end-user relationship for finance, while the vendor keeps control
of the end-user relationship for the equipment sale.
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“But if I were a vendor I’d certainly want to have full
ownership of the customer relationship,” Rendell said.
Rendell also noted the changes in expectations of vendor clients
on the base-line services offered by funders. Where five years ago
it was internet portals, residual values, credit bandwidth and
international scope that “excited” vendors, these days they have
become base-line features of a funder’s services.
In place of these “exciters” now are managed services, vendor
captive contracts with end users, pay-per-use products and the
ability to provide consistent multi-country services.
While Rendell acknowledged that captives will aspire to be
bigger and better, its capability to grow is also hindered by its
closeties to the manufacturer. In addition, low returns on equity
in the finance market would act as a drag on overall ROEs of the
manufacturing business.
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By GlobalDataFinally, he asked, would manufacturers want to hold credit risk
on its customers under the credit crunch?
