Guest Column | March 3, 2022

Finding A Fit: 5 Tips For Vars To Select The Right Finance Partner

By Paul Stemler, Mitsubishi HC Capital America


For a tech VAR, finding a finance partner is generally not difficult. Plenty of bank and non-bank providers are happy to offer their services, particularly to well-capitalized VARs with good liquidity.

But not all finance partners are alike. Determining which company will provide the best support is critically important in today’s market. The ways VARs finance their businesses are much more diverse than ever. Add in the need to keep up to date with and finance constantly changing technology and business models, and it’s clear that the choice of a finance partner should be a thoughtful, careful one.

To help in selecting the right finance partner, VARs should look for these five attributes.

  1. Relationship focus. While “relationship” is now often relegated to a cliché buzzword in business, a finance partner must have the willingness and ability to develop an active working relationship with the VAR. A trusted partner will seek to understand, at a detailed level, the VAR’s business model, market, differentiators and challenges. A true partner will be sensitive to the VAR’s relationships with its customers, look to understand those customers’ businesses, and be able to help them in working with the VAR. Through this process, the finance provider can serve as a trusted advisor.
  2. Customized financing programs. The ability for a finance partner to think smartly in developing programs tailored to a VAR and its specific business is crucial. One that employs a consultative approach will take the time to learn about clients’ businesses and business models before ever suggesting a financing method or program. Instead of a commodity solution, a consultative approach will result in recommendations that help VARs achieve their individual, specific short- and long-term goals.
  3. Up-to-date IT financing. A finance partner will know that being able to efficiently acquire new technology without breaking the bank is an ongoing and increasing need for both VARs and their customers. A financing source that offers this type of financing is a major asset to a VAR’s business.

Consumption financing, for example, allows a VAR to take possession of some types of technology – such as storage or computer memory – and pay for only what it consumes on a monthly (or other periodic) basis, like a utility. Finance partners who stay one step ahead of client needs will be able to suggest and offer consumption financing as a complement to traditional financing programs. In doing so, the partner can help a VAR increase its capability to scale and roll out new products and services incrementally without large up-front capital costs.

  1. Vertical industry experience. A finance partner with experience working with the VAR’s markets carries essential value that converts directly to the bottom line. For instance, if a VAR sells extensively into the government sector, a finance partner with relevant experience will understand regulations, help assure compliance and avoid unnecessary bottlenecks.
  2. Solid controls. Companies that have poor controls tend to have muddled receivables and long supply chains. A true finance partner will provide strong financial controls, which ultimately shorten the supply chain by tightening and assuring that purchase order best practices are in place and are enacted accurately and on time. Something as seemingly simple as a purchase order arriving with a different price than what was initially booked can cause a ripple effect of payment delays.

Choosing a partner with a solid balance sheet and resources is important. Choosing the best financing partner, though, can make all the difference for a technology VAR. As technology continues to evolve at breakneck speed, a financing partner that can offer programs for those changing conditions will serve as a key proponent to a VAR’s business growth.

About the Author

Paul Stemler is President – Technology Finance, Mitsubishi HC Capital America, a provider of customized financing solutions for IT manufacturers and resellers. Visit