Resellers and distributors are supportive of plans to introduce an industry specific credit card to the Australia IT channel.
While many smaller dealers have traditionally been unable to get a line of credit with distribution partners until they have established a long and reliable payment history, the DealerCard has the potential to break down those barriers by taking credit responsibility away from wholesalers.
“It can only be a good thing from a reseller perspective,” said Express Data managing director, Ross Cochrane.
“There are positive signs in the market but anybody wanting to capitalise on those to achieve growth will need to extend their lines of credit.”
Of particular significance, Cochrane said, was the fact that the scheme was backed by somebody with significant channel history.
“Hugh [Evans] is an experienced channel guy and has a clear understanding of industry requirements,” he said.
“Many resellers find their customers want an account, which they have to fund with their own cash or through credit.” General manager of sales and marketing for Altech, Safa Joumaa, was also upbeat about the proposed scheme. He said it would give resellers more flexibility.
“A lot of resellers want credit but can’t get it if they don’t have a longstanding relationship with a distributor. This will ease the burden for them,” Joumaa said. “Many of our resellers are on a tight budget and wait until their customers to pay up before settling accounts with us. If this card helps improves cash flow for those partners then bring it on.”
Tech Pacific managing director, Kerry Baillie, was also supportive of the concept but sounded a note of caution.
“Anything benefitting smaller resellers and helping distributors get paid is a good idea but the devil is in the detail,” he said.
“If it’s practical we’ll support it; if it’s not, we won’t.”
Some resellers contacted by ARN said the DealerCard would not provide them with any practical advantages because they preferred cash transactions or had established credit arrangements with distribution partners.
Managing director of Correct Solutions, Wayne Small, said the only use he could see for the card would be to finance deals with smaller suppliers that he only used occasionally.
“You also have to consider the premium being charged for the service because every percentage point counts,” he said.
“But it could be useful if it’s tied into a reward scheme.”
Managing director of Meier Business Systems, Martin Meier, said he had good credit terms with his major vendors but had no problem seeing the potential positives in the Moneytech plan.
“I usually only rely on credit when I need to transact quickly or if it’s a one-off with a new vendor,” he said.
“But this is a really smart idea and could be very useful for international transactions — we regularly purchase from the US using credit cards.”