In the vendor finance world, it appears the more things change, the more they indeed stay the same – at least when it comes to client service.

We all know the equipment leasing industry has experienced significant changes over the past decade or so. The liquidity crunch and brutal global recession led to unprecedented consolidation in our business, with the greatest impact on independent lessors. There are simply fewer vendor finance providers in the market today.

Those lessors that survived the past few years, in particular, are starting to see a slow recovery in the demand for equipment and vendor financing. One would think those finance providers still standing would be sitting pretty, with less competition. Nothing could be further from the truth. There may be fewer funders in the market, but the competition is fierce, led by big bank lessors.

So, what distinguishes best-in-class vendor finance providers today? As in the past, they must provide consistent and reliable financing to vendors, who are fighting for every deal out there in today’s sluggish market. Jointly establishing expectations up front in regard to credit criteria, approval rates and other performance indicators is critical in this regard.
Another best-in-class practice focuses on responsiveness. Funders must be willing to address the needs of vendors as they seek new ways to attract customers both here and abroad. Finance providers must also be more creative than ever in the products and services they offer, to differentiate both themselves and the equipment vendors they support. And finally, vendor finance providers must truly understand the assets they are financing, for this is critical in setting residual prices.

What other similarities link the most successful vendor finance providers of the past to today’s best? Which companies lead the way then and still do now – why? We would love to hear from you.