Benefits of Selling IBM Prepaid Maintenance on a Lease

Service Maintenance Contracts are an important component of a Reseller’s revenue stream. Protecting your customers’ leased hardware is just as critical as servicing the equipment they own. With a multiyear IBM prepaid maintenance contract, which can be financed through IBM Global Financing (IGF), you can offer your clients such protection.

The biggest and most obvious benefits for you as the Reseller is not just the increased revenues of a prepay contract, but also:

  • Receiving your profit up front for the entire contract term.
  • Keeping credit lines open for additional new hardware business vs. ongoing maintenance contracts.
  • Greater leverage in attaining IBM/IGF business incentive targets, rebates and fees.
  • Avoid competition for a longer period of time.
  • Build a profitable annuity business with ongoing multi-term, prepayment renewals.
  • Ask for renewals less frequently and avoid the costs of producing invoices and collecting payments.

For your customer, the biggest benefit is the savings that the prepaid maintenance contract offer. They will immediately save thousands of dollars each year with the prepay term discounts and price protection of having a contract. Multiyear prepayment contracts combined with IBM Global Financing offers clients a more predictable cash flow and can help lower total payments.  Additional benefits for your customer include:

  • Locking in the current price longer which helps with budgeting and also avoiding potential annual increases of 3 – 5%.
  • Reduction in long term maintenance expense can result in up to 15% in savings over the life of the maintenance contract.
  • Save time with a single approval instead of an annual request.
  • Reduce administration and processing costs by paying a fixed invoice from IBM Global Financing.
  • Customize payment structure to align the cost outlays to projected benefits.
  • Clients have the ability to add and delete machines on IBM Pre-Paid Maintenance. The existing IGF invoice does not change.
    • If IBM or the Business Partner provides a credit for machines removed from pre-paid maintenance,the client can arrange to have the credit applied to the IBM Global Financing invoice.
    • Additional machines added to IBM Pre-Paid Maintenance can also be financed co-terminously with existing maintenance financing.

In today’s economy, it’s all about value and stretching your dollars. Next time you sell Service Maintenance Contracts, consider offering financing. It is a great way to help your customer save money and, as a Reseller, it streamlines your contracts while increasing your revenue and rebates.

Here at Managed Maintenance, Inc., we have a number of offerings designed to help Business Partners improve the profitability of their maintenance business.  To learn more about Managed Maintenance, Inc., visit us at www.managedmaint.com or call us today at 561-869-4399 x1287.

Leave a Reply