Networking vendor ZyXEL is targeting smaller VARs with its zero per cent finance scheme, aiming to compete against rival Cisco.
ZyCap offers three-year financing options for purchases between £5,000 and £200,000, after which end users can choose to give back the kit or pay an additional one per cent to buy it.
According to Antony Byford, the vendor's head of channel in the UK and Ireland, the scheme will help smaller VAR partners win bigger projects that would otherwise be beyond their reach.
He said: "There was a strong demand from smaller businesses with fewer than 10 people. These types of business do not have a lot of cash but are still trying to penetrate bigger opportunities.
"The banks either say no or charge them a lot in interest, so the terms are not favourable for them. A scheme like this is great for them, and from the feedback we have got, they say it is fantastic.
The scheme will allow ZyXEL to compete more effectively against the networking market's dominant force, according to Byford (pictured).
"We have identified that there is a massive part of the market we cannot penetrate because our competitors, mainly Cisco, offer a really good finance scheme and this means we just cannot get in there," he added.
"We talked to customers and finance houses and came up with this solution, which our partners think is great."
Although the vendor claims the idea of the scheme has gone down well, according to Eddie Pacey, director of EP Credit Management and Consultancy, VARs and end users are often too shy to talk about finance.
He said: "Resellers are not keen to sell the notion of finance to end users, as they do not see it as part of their job. It is rare for end users to ask for finance, and VARs are too shy to ask if they need finance in case they give the impression that they think an end user cannot afford their products.
"Vendors need to work more closely with the reseller; much more closely than just allowing a portal on a website that simply provides a quote. [This] sort of thing is a great start, but vendors need to work more closely with VARs, and resellers need to be trained to sell finance on top of that," he added.
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