D&H makes another infusion to an initiative which has operated successfully as part of the Business Assurance Program for years, and which has delivered substantial returns to vendor participants as well.
D&H Canada has announced a new extension to its credit initiative to provide increased financial resources to select reseller customers. This new disbursement for the 2017 fiscal year, which started on May 1, will see hundreds of partners share approximately $80 million.
“We have this tool called the Business Assurance program, which we use to stimulate more credit availability into the channel,” said Greg Tobin, general manager at D&H Canada.
The program isn’t a limited term one. This particular announcement is a regular extension of new credit to selected partners, which continues indefinitely if the partner’s credit remains in good standing.
“We regularly do incremental supplements to this, and it’s not just in Canada, but in the U.S. as well, Tobin said. “As long as a customer is in good credit standing, they retain eligibility, and can retain the extension for years and years. What we hope will happen is that they use it up, become a stronger partner, pay it down, and qualify for more credit.”
Partners selected for new credit increases will receive credit limit increases of at least 20 per cent, with some with smaller limits able to double their credit. Criteria for selection include past good credit standing with D&H, D&H’s assessment of their potential for business growth, and the resellers’ participation in D&H Canada’s existing loyalty and rewards programs.
“We sent out letters to the eligible partners in the first week of our new fiscal year in May,” Tobin said. “We follow up regularly with calls from the partner’s sales rep so they know they have it, and recommend where they place these dollars.”
Tobin stressed that because credit is so important in the channel, this kind of program, which uses vendor sponsors’ resources to extend credit responsibly, is vital.
“Credit is a privilege, it is never a right,” he said. “Because cashflow is so important in everything we do, it’s important to handle credit right. People often stretch their cashflow by paying people late. My positon is that if you take care of your suppliers, they typically take care of you.”
Over the years, many more vendors have chosen to participate in the program compared to its early days. Vendors supporting the D&H Canada Business Assurance program this year include long-time participants like Cisco and Lenovo, as well as HP Inc., APC-Schneider, and more than 70 others.
“We have a lot more vendors in the program today, and more vendors helps us to keep the engine running to outpace the industry,” Tobin said. We know that the vendors who participate in this program see more than 2x the growth rate as opposed to those vendors who don’t participate.”
Tobin said participating vendors receive soft benefits from taking part as well.
“From a goodwill perspective, people like doing business with people they like doing business with,” he said.