IndustrialComms takes on bigger projects with the help of Siemens Financial Services
IndustrialComms is enjoying greater cash flow flexibility as a result of Siemens Financial Services’ (SFS) Extended Payment Terms (EPT) tool. Launched earlier this year, EPT is available to regular buyers of Siemens’ products. IndustrialComms, a leading supplier of industrial communications products, became a distributor for Siemens Digital Industries two years ago. Projects that required high levels of investment were putting pressure on the company’s finances. Now, EPT has enabled IndustrialComms to take on projects that would otherwise have been unattainable.
Graham Bull, sales director, IndustrialComms explains, “We were involved in a particular project building a wind farm. Large-scale projects like this often have long lead times which mean we have to make a significant investment before completion and payment. The products required from Siemens were outside of our established credit limit but it was suggested that EPT, provided by SFS, could help. The tool was implemented for that project but we now have the tool available for future use too.”
Through a revolving credit facility, SFS purchases the debt from Industrial Comms giving the business flexible repayment options with a choice of when to pay, up to 180 days. There’s no impact on existing credit lines and no additional security required. As a result, Industrial Comms has been able to share the benefits along the supply chain, by giving its customers extra credit.
“Like our customers, we are often purchasing expensive components and parts. EPT means we can smooth the impact of these costs. They say cash flow is king and EPT enables us to manage ours much more effectively,” says Graham. “It means we can take on projects that would otherwise have been difficult to manage, and this will ultimately help us to expand the business in the future.”
SFS set up Industrial Comms’ EPT facility within a week. It is fully integrated into the Siemens ordering system and the customer can choose when to use it.
Ian Cole, head of invoice finance for Siemens Financial Services says, “Our relationship with Siemens puts us in a unique position to be able to provide this cash flow tool to their customers. Businesses often wait a significant period of time before receiving payments from customers and are therefore buying products before invoices are settled. EPT gives businesses more flexibility to manage their credit lines effectively.”
Graham adds, “It’s highly unusual for a supplier to offer us a finance tool that’s fully integrated as part of the sales package. We are impressed by the rates offered and the flexibility the tool affords us. For these reasons we will be using it to buy more products from Siemens in the future.”
