Intelco Group plc., leading specialist in the design and implementation of IT rental programmes, is today launching Even Rent, a new way for users to 'pay as they use' IT applications. EventRenttm results from an increasing demand from the market place for a method of paying for usage of an IT application, rather than straight rental or purchase.
In the EventRenttm agreement, the rental charges are based on the predicted usage level of the application solution. If the actual usage exceeds that predicted usage or the usage continues beyond the initial period of the agreement, the user pays for the extra usage as and when incurred.
EventRenttm may be for software only, or include hardware and maintenance.
Prior to today's announcement, rental agreements, that were based on usage, presented suppliers with profit issues. Not only were they faced with covering the initial costs of their products, but revenue recognition and cash flow were also uncertain and spread over the life their agreements.
With EventRenttm, usage based customer orders are no longer a problem for anyone because Intelco purchases the complete system, application software and hardware for a price based on the value of the EventRenttm agreement. This removes much of the need for the supplier to actually fund the application and solves the issues of revenue recognition and cash flow. Where the predicted use is exceeded, the supplier receives additional payments, thus rewarding it for a successful application and the risks taken..
"Paying for what you use, is probably the nearest thing to perfection in rental terms," comments Michael Stephenson, Chief Executive of Intelco. " And that's what EventRenttm is all about. User demand for this method of charging is not only logical but is becoming increasingly common especially for web-enabled applications. Because we are talking IT, most applications can be EventRenttm solutions provided that the events can be identified and counted. At the end of the day, its going to be more about getting the right balance of risk and reward for both parties"
Formed in 1988, Intelco Group Plc is perhaps the leading specialist in the use of rental within the IT Industry. Customers span all sectors of business, commerce, local and central government. To date, this expertise has been focused on developing rental solutions for IT suppliers.
For further information
CH Business Development
Intelco Group Plc
EventRenttm is a trademark of IntelcoGroup Plc.
Note to Editor – Suppliers who would like to offer an EventRenttm solution with their software or hardware solutions should in the first instance email firstname.lastname@example.org .
Below are some of the benefits rental has over purchase:
· Rental users have the software and hardware when they need it - not when they can afford the capital or get through the budget approval process.
· Cash Flow is greatly improved with no capital payments and payments are from revenue budgets and at lower cost.
· Cost justification is easier and directly measurable. Savings v costs replaces ROI and payback calculations. Savings start from month 1 not sometime in the future.
· Greater flexibility is gained to change product at any time without balance sheet write offs or profit/loss impact.
· In times of budget stress, cash budgets can be made to acquire 3 or 4 times more product than purchase.
· The supplier remains directly involved as the provider of the product and its support. All warranties are directly from the supplier.
· In essence it's easy, economic, flexible, timely and directly involves the supplier.
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