In challenging times, difficult decisions need to be made by businesses every day. Many of these decisions concern money and how best to reduce spending while still fulfilling business objectives and satisfying customer needs.
This is difficult to do effectively under normal circumstances, but it’s even tougher when faced by something as unexpected as a global pandemic, which has forced businesses to act whether they’re prepared or not.
And while the temptation might be to simply cut spending wherever possible, a much more effective way to manage cash flow under such challenging circumstances is to investigate alternate procurement methods. The more flexible these are, the better for the business.
Here at Velocity Group, we deeply understand the challenges being faced by our customers and their need for financial flexibility in these trying times. We hold the belief that finances should not be a barrier to continued operational excellence, even in a pandemic.
Thus, we work in partnership with HPE Financial Services to offer forward-thinking ways for organisations to gain access to new IT hardware during the lockdown. We also offer ways to inject capital, at no cost to the business, using a flexible consumption model.
“We have years of experience building both cloud and on-prem stacks for our customers, and we’ve seen a definite shift towards hybrid stacks that deliver the best of both worlds,” says Velocity Group CEO Jonathan Kropf.
“By shifting workloads to where they run best, whether that’s in the cloud or in an on-premise environment, a hybrid approach allows organisations to get the most from their IT budgets. Best of all, a hybrid strategy provides businesses with predictable monthly costs that can be easily budgeted for.
“Our objective is to ensure businesses can access the IT technologies they need through flexible financial support, because in 2020, access is more important than ownership,” Kropf adds.
Short-term help, long-term benefits
Since the pandemic began, we’ve seen businesses diverting their cash flows into areas where it’s most needed, like keeping the lights on, and away from their IT environments. Many projects have been put on hold indefinitely, and businesses are coasting on what they have while they await the lifting of lockdown restrictions and for the economy to show signs of life again.
While this might seem like a practical approach to the immediate need to curb spending, experience has shown that sweating IT assets for too long can result in even higher total costs of IT as parts and repairs and support-related services skyrocket – especially on solutions that aren’t as modern as they could be.
But this doesn’t have to be the case. HPE Financial Services has a US$2-billion “Covid-19 Relief” fund that it’s using to help organisations around the world through this period, and as an HPE partner Velocity Group can help South African businesses to access the financial aid programmes that the fund makes possible.
Payment relief options
The first solution is a 2020 Payment Relief Programme that allows organisations to access the IT their business needs today, while offering payments of only 1% of the solution value for the first eight months of the contract, and they can choose terms of 36, 48 or 60 months. After the first eight months, payments go up to +/-3.3% of the solution’s value.
Anton Pauw, finance area manager at HPE South Africa says: “This is a relief programme focused on the immediate cash flow impact of the Covid-19 pandemic. If businesses commit to this offer before 31 July, the first day of the next month after the technology is delivered is the first day of the eight-month payment holiday. This is the kind of flexibility that differentiates us from more traditional financing alternatives, like the banks.”
This option can be applied to the full portfolio of HPE servers & systems, networking and data storage hardware, giving businesses plenty of options.
90-day payment deferral
The second solution is a 90-day payment deferral on new technology purchases, whereby businesses pay absolutely nothing for the first 90 days, and then low monthly payments over the next 36 months. This can be applied to the full portfolio of HPE servers & systems, networking and data storage hardware, as well as select third-party software, software appliances, services and installation.
This flexibility lets organisations access the IT hardware and services they need and use it to generate revenue to help them through these challenging times, while offsetting their own expenses in the short term.
Both payment options can be tailored to the business’s needs, too, and that’s where Velocity Group excels. Establishing how, exactly, HPE Financial Services can best serve your business is a consultative process, and we will work closely with you to tailor the solution that works best for you.
Our third offer is one that can do more than simply help organisations save on costs: it can inject capital back into the business while simultaneously accelerating its digital transformation journey.
We do this by helping businesses switch from an ownership model to one of flexible consumption, by selling us their IT assets and leasing them back from us at a low monthly cost. That way they unlock money to spend on other business critical projects while retaining the use of their existing IT assets.
The rationale behind this is quite simple. Many businesses are held back by their physical IT infrastructure, often because the finance department requires them to hold it for an extended period of time. This clashes with the business needs of improved system performance, better security capabilities, and cost efficiency.
By turning existing assets into cash and releasing IT from finance’s extended holding requirements, businesses get the freedom and money they need to jumpstart IT projects that can drive innovation and transform the business further.
The fine print
As you’d expect, qualifying for any of these financial assistance programmes follows an application process, for which there are terms and conditions.
Businesses will need to submit documentation confirming their current financial situation and will be subject to an evaluation by Velocity Group and HPEFS.
What is comforting, however, is that this is done on a customer-by-customer basis, so the merits of each application are considered with cognisance of the impact that the global pandemic has had on businesses all over.
The focus is on confirming that the company in question’s business was liquid and healthy before the crisis hit, and then providing relief that can get them back on track.
Talk to us
The national lockdown doesn’t have to be an obstacle to your business’s continued operation or prosperity. The flexible payment options that are available through Velocity Group can get you access to the IT resources you need today, and you can use those new assets to generate revenue for months before you start paying for them proper.
And if you really need cash right now, Velocity Group and HPEFS can help with that, too. Get in touch and we’ll do our best to help.
Velocity Group is uniquely positioned to help businesses take advantage of these flexible offers. We leverage our in-house IT expertise and close working relationship with HPEFS to advise our clients on the best way forward that meets their needs, whether those are IT, financial, or both.
For more information, visit hybrid-it.velocitygroup.co.za.
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