Ideal fund to improve reseller finances

Ideal Hardware has set up a company called Unifund to offer financial services for resellers.

Ideal Hardware has set up a company called Unifund to offer financial services for resellers. The financial products provided will include leasing, invoice discounting and factoring and end-user invoicing.

Sarah Hordle, who joined Ideal to set up Unifund, said: "We are not just selling financial products. By understanding their business, we can provide resellers with a package to re-work their entire business financing."

Rival distributor Ingram Micro is also about to launch a financial services package, called Select Source, which will offer end-user invoicing. Philippa Kent, business development manager for managed services at Ingram Micro, said the scheme will enable smaller resellers to handle large-customer accounts. "What matters is how credit-worthy the customer is, not the reseller," she said.

Brian Burke, manager of Dun & Bradstreet arm ComputaNet, said: "These are the things that distributors do day in, day out. It makes sense for them to do it on behalf of their customers [resellers]."

Burke added that by "buying in bulk", distributors should be able to obtain better rates from financial companies to pass onto their resellers.

Brian Pennington, marketing director at reseller Brilaw International, said although most of these financial services are available elsewhere, it makes sense to go to distributors because they are already involved in financing resellers by offering credit lines.

"We have been looking at ways of making our deals work better for us. One way is by reducing our debtor days, for example," said Pennington. "It would help to work with a finance company with knowledge of our market."

Unifund will offer financing for deals where products are supplied by Ideal or its distribution rivals.

Hordle said Unifund can help resellers present a more professional front to their customers, while making their businesses look better in the eyes of their banks. Burke said the smaller, growing resellers are the companies that will benefit most from improved cash-flow and debt administration.