Antonio Fabrizio finds commitment-shy customers may be
tempted by lessors’ innovative new schemes.
As several manufacturers launch or prepare to launch their own
pay-as-you-go leasing schemes, it looks like this
simple-yet-attractive form of financing could be a route to signing
a good number of deals with customers loath to commit to spending
large sums in the current financial environment.
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Carl Zeiss, a manufacturer of
microscopy, medical equipment and lenses, has been the latest of a
number of manufacturers to launch such a scheme, specifically for
its coordinate-measuring machines.
According to the manufacturer, it is
more flexible than its current leasing offers, as it allows
customers to use the machine for one year, paying only for the
hours of use, subject to an agreed minimum usage.
The machine controller will record the
hours of usage and users will only be billed for the time the
machine has been used, the company said.
At the end of the one-year contract,
customers will be able either to buy the machine with a rebate for
the rental amount already paid, or they can return it, subject to a
small fee for de-installation and shipment.
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By GlobalDataIBM Global Financing, too, is
preparing to launch a finance model for clients based on their
individual need for storage, following an increase in demand for
pay-per-use (PPU) options.
But Dan Ransdell, IBM Global
Financing’s general manager for worldwide client financing, said
most customers looking for a pay-as-you-go model do not want a true
100 percent scheme, as that would involve some form of rental
offering, which costs significantly more than a lease.
Ransdell said: “What customers are
asking for is a way for them to get a base capacity up to a certain
level, and then to have the ability to have a peak incremental
capacity that they pay for as they need it.”
The PPU model, however, is not a
new concept and has been around for decades.
It started as “click rent” for
companies which leased office products such as a photocopier, and
attached a meter to it, with lessees paying so much rent per copy.
Subsequently, it extended to PCs and the rest of the IT industry,
with the basic notion that customers would pay for computing when
they needed it.
Lots of interest
According to HP Financial Services (HP
FS), lots of customers are currently interested in talking about
PPU options.
HP FS spokeswoman Sharon Barclay said
the solution is popular in banks, retailers, and wealth management,
and in companies with seasonal needs.
“Banks often have to run processing
hard in the day and not so much at night, or they might do it in
reverse, depending on their business, while retailers tend to run
full out in autumn and spring, but need less in summer and winter
when it is quieter,” Barclay added.
HP Financial Services has seen demand
for PPU options remain stable over the years, but has noticed
customers are generally more interested in talking about PPU than
actually signing up.
“This is because it is not suitable
for all customers, as they do need to make modifications to their
own business processes,” Barclay explained.
But because of its increased operating
flexibility and the seasonal control over IT infrastructure
expenses that it offers, an increasing number of companies could
look to PPU to help them make savings.
Barclay concluded: “As CIOs are trying
to do more with less and want their expenses tied to seasonality or
the needs of the business, they are looking to PPU models to help
them achieve their goals.”
