Global technology distributor Westcon-Comstor is delivering flexible funding for the IT channel through a new payment service called Flex.
A central part of Westcon-Comstor’s broader approach to partner success, Flex is designed to enable long-term, sustainable profitability and relevance as the ICT industry moves to as-a-service models.
That shift allowed digital transformation programmes to become more agile and iterative by providing easier access to technology and reducing pressures on capital. However, vendors and partners struggled to offer the subscription services customers expected due to pressures on their own working capital and cashflow.
Westcon-Comstor said Flex alleviated these concerns by providing a range of flexible payment solutions, contracted, and invoiced directly by the distributor without having to go through third-party billing agents or brokers.
An early success story for the service is Cello, which claims to be New Zealand’s fastest growing telco. Cello adopted Flex during the height of the pandemic to help its clients tackle funding crunches.
“If you’re not in the business of making your partners and customers successful, then you won’t be in business for very long,” said Andrew Allan, Cello chairman. “Gone are the days of a one-size fits all approach; flexibility is critical to successfully adapting to market changes."
Allan said Cello was in a capital-intensive game and needed to work with partners that were prepared to work in a way that worked for Cello and its clients.
"During COVID Westcon-Comstor upped the ante and adapted its services to fit our specific needs," he said.
Cello was formed in early 2020 when IT services company Computer Concepts sold the operational parts of its network services division in a management buyout. Cello covers the suite of network services from WAN/SD-WAN and internet to LAN, WiFi, and cloud connectivity.
Dave Rosenberg, general manager of Westcon-Comstor New Zealand, said when Cello launched in 2019, Westcon was excited by its digital transformation vision and wanted to support and accelerate its growth.
"Working with Cello we created innovative asset financing mechanisms allowing Cello clients options with respect to how they fund the infrastructure needed to assist with their business solutions," Rosenberg said.
Callum McGregor, CFO of Westcon-Comstor, said the market had an obvious desire for subscription-based consumption models, but to offer this was no mean feat.
"We’ve designed Flex to best serve both vendors and partners," he said. "With Flex, partners unlock greater vendor discounts by increasing the deal size and maximising the value they get for their budget early on."
Because no third party billing providers are used, partners deal with Westcon-Comstor in the same way they would with any standard purchase.
"Plus, they can match payments in with payments out, so the customer gets exactly what they want, how they want it, without impacting the partner or vendor’s cash flow," McGregor said.
In March, Cello acquired Wellington-based network specialist Pentech Communications to bolster its consultancy and services capabilities.