Drawing on our in-house expertise, Direct Capital will be chatting with segment managers and sales representatives for enlightening looks at what’s going on in the world of finance. Today, we talk vendors with Sales Manager Brian Todd and VP Senior Vice President John Donohue.
In the first three months of the year, trends began to emerge in the vendor segment of Direct Capital’s business.
From conversations with Brian Todd and John Donohue, who are as tapped-in to the segment as anyone at the company, I identified three primary trends in a field that saw a steady demand for financing in the first quarter. Without further ado, let’s get into those trends.
Wary Bank Lending
Todd said in today’s cautious lending environment, major banks “don’t want to do deals” under $100,000. In the dental and medical spaces and across the vendor client spectrum, businesses are looking for the needed capital to secure the equipment that their clients need.
Direct Capital is seeing an increased demand for deals under $100,000 as a result, Todd told me, and are ready to step in and answer the call.
“We can fill that void,” Todd said.
Another emerging trend that Direct Capital has been a major player in is working capital, especially for those in the medical field, an area Todd said is “resonating” with vendor clients.
Quick Turnaround A Plus
Vendors made weary by slow or nonexistent responses to their requests for funding are eager to get their hands on the working capital and other financing they need. It’s little surprise that those who can get deals done quicker are benefiting.
In the case of some deals, Todd and Donohue said there is a true need for speed. Todd cited one customer who was attracted to Direct Capital by its electronic documentation and ability to turn around a deal within a day.
You can hardly blame those who have been waiting so long for being attracted to such offers.
Bonus Trend: Where’s the Demand?
According to Todd and Donohue, “yellow and orange iron,” or construction equipment including smaller-block trenchers and major pieces of equipment are sharply trending upwards. Major manufacturers such as CAT are seeing demand skyrocketing, with an estimated 40 percent bump over a year a go in that sector.
“That industry is booming,” Todd said.
That’s our report from our corner of the vendor world. We would love to hear your feedback.
*Working capital not available in the following states: AK, DE, ND, VT