Dell Brings Financial Incentives To Channel Partners With GE Capital, Wells Fargo

As part of a larger coordinated strategy, Dell has partnered with financial institutions GE capital and Wells Fargo to enable and incentive channel partners that are selling Dell products and services, the Round Rock, Texas-based company announced Tuesday.

Dell is teaming up with Chicago-based GE Capital and San Francisco-based Wells Fargo to provide financial incentives for Dell resellers, said Cheryl Cook, vice president of channel alliances at Dell.

"We are trying to ensure that we're enhancing and exploring every avenue to extend tools and capabilities to our partners and customers that can help them to grow this business," said Cook. "Finance offerings will address short-term cash flow issues or concerns with our partners and customers. We want our resellers to take advantage of the offers and incentives directly from Dell."

[Related: Dell Kicks Off Channel Friendly Program With A Bang ]

In terms of financial incentives, Wells Fargo and GE Capital will provide extended payment terms for channel partners, said Darren Fedorowicz, executive director of Dell Financial Services.

"From a partner perspective, cash flow is a critical component to grow their business," said Fedorowicz. "This is a program where instead of having a net of 30-days term which is typical in the marketplace, it is extended up to 60 days, interest free. This allows them to purchase more and service more customers, while not impacting their liquidity."

Previously, the program was available only to direct partners, but now, as a part of a broader strategy, Dell will continue to focus on and leverage financing offerings to channel partners, said Cook.

"It's very aligned to our strategy of wanting to embrace the channel more aggressively to grow our business," said Cook. "I hope [partners] feel that not only are we embracing them, but we're proactively planning where we want to expand, and we're giving them the financing terms, which will allow them to expand, accelerate and grow their business without short-term cash pressures from a cash-flow perspective."

GE Capital said it believes there is a scarcity of liquidity for channel partners, which is necessary to grow a business, said Michael Marcolina, managing director for technology and finance business at GE Capital.

"One of things we're seeing in the channel community is that it's lacking is liquidity. So what GE Capital brings in this partnership is not just a longer term [of 60 days], but in liquidity," said Marcolina. "After payroll, to drive the growth of the business for cloud, security and different types of data centers, customers need to make investments in those solutions and need help with the liquidity side of it."

GE Capital will help solution providers develop their business and flourish, said Marcolina.

"This program compliments Dell's goals and objectives as a more visible player in the channel, and we will certainly do what we can," said Marcolina. "This is part of the value add that the partner looks for when they do business at the OEM level in differentiating the business while driving more growth and minimizing strains on working capital."

NEXT: Zero-Percent Interest On EqualLogic, Compellent

Daniel Serpico, president and CEO of FusionStorm, Dell's SMB Partner of the Year for two years in a row, has been a partner with GE Capital for the last 10 years. The San Francisco-based solution provider is excited to receive financial incentives from GE Capital through Dell, said Serpico.

"This is a clear indication of Dell really embracing the channel, seeing value, and now it's an enormous value for us in the channel," said Serpico. "It's access to capital, larger lines of credit and to sell more Dell products -- it's that simple."

Currently, FusionStorm doesn't use local or big banks for loans or financing for their business, and through this incentive, the company's ability to finance and make investments will grow business, said Serpico.

"We don't have to [use banks] because of GE Capital; they fill the role of a bank and offer a far greater scale and more flexibility," said Serpico. "We have access to capital, which allows [FusionStorm] to make investments in other things, and recently we invested in new software automation in supporting Dell stacks, for building Dell racks."

Wells Fargo will also be providing 60-day financing terms to Dell channel partners, giving resellers visibility to their account, invoices and customizations, said Steve Hopkins, division manager of direct supply chain at Wells Fargo.

"From Dell's perspective, it's to drive liquidity in the channel and to maintain control over the credit terms, and it strengthens the buyer's loyalty with the channel, which is the biggest part," said Hopkins. "It's further proof of their commitment to the channel, providing this wonderful source of capital for Dell resellers."

An additional financing incentive from Dell also includes offering channel partners zero-percent leasing on Dell EqualLogic and Compellent technology storage equipment, said Dell​'s Fedorowicz.

"This is a program that we offered to business customers direct with Dell, which means they pay for 36 months, and at the end, they own the equipment," said Fedorowicz. "They effectively pay a zero-percent interest, and the purchase price is what they pay in 36 equal installments. We've extended this program, which has been highly successful with our end-user customers through our channel partners."

For the future, Dell plans to expand its service and channel partner program to 20-plus countries, including Europe, the Middle East, Latin America and Asia, later this year, said Dell's Cook.

"The channel is an important part of our business today, and we have these opportunities to accelerate our growth and help our partners with growth ambition," said Cook. "We want to expand beyond our U.S. roots and be a global service provider."

PUBLISHED FEB. 6, 2014