Innovating and adapting to changing demands from our customers has been the backbone of Merrimak Capital’s growth for the past seven years. We believe our success is dependent upon our ability to differentiate ourselves and our service offerings by solving not only our customers’ short-term needs but also their long-term challenges. Our continued commitment to these business practices will drive our future successes.
Building Customers’ Trust
How do we differentiate ourselves? First, by building customers’ trust. The basis for all relationships is trust, something the economy, demand or technology cannot change. The leasing industry is an anomaly. The unapprised assume the lease rate factor (“LRF”) represents the cost of the lease, but the informed know better. The LRF is only one cost component of the lease transaction. As customers become more knowledgeable, they quickly realize what actually drives the true cost. It’s the terms and conditions and, ultimately, the DNA of the lessor they are working with.
It is not what we say but what we do and how we innovate to bring solutions. We could always bid for the bottom and win, but that is a game of Russian roulette. Either the lessee or the lessor is going to win and sustainability is lost. What is going to differentiate us? It is beyond finding ways to get around the future classification of FASB 13. We all know the leasing industry will long survive, at least for those whose service offerings go deeper than quoting the lowest LRF.
Tapping Into the Supply Chain
Another way we differentiate ourselves is as a diverse supplier. In 2009 Merrimak obtained certification from the Women’s Business Enterprise National Council (WBENC), supporting the supplier diversity initiative of the customers that it serves. Our WBENC status elevates our visibility within corporate supply chains every day. That’s where it all begins. However, while Merrimak recognizes that our WBENC status opens doors, we have to earn business on our own merit.
Once we are “in the door,” we have to identify needs, provide solutions, have a purpose and, most importantly, gain the advocacy and support from the supplier diversity professionals. Competitors, banking partners and unbiased observers sometimes attribute Merrimak’s success of engaging over 70 (and counting) of the Fortune 500 and alike corporations to our WBENC status. This leaves me speechless. Our customers select Merrimak because we have earned their trust, provided a solution and, most important, we are competitive.
Meeting Customers’ Needs
Merrimak’s future success begins with a strong and unified team supporting our coveted customer base—another strength that sets us apart from the competition. We must present a compelling reason for customers to want to engage our services. This is not something that comes easy. It must be worked at every day and is essential to move to the next plateau. What problems are we solving that the competition is not? We must be able to execute within our customers’ timeframe.
I recall my finance group worrying almost with panic about available low single-digit equity. This concern was dismissed as I recognized that the equity would follow the deals, especially with the credits that we serve. Merrimak treats its customers’ interests as our own. Gain sharing may come easy in the leasing industry but eventually results in the demise of the relationship. Being a one-term lessor or having a customer feel they have overpaid is short-sided. As a savvy lessor we know we must be willing to walk from a deal and not gamble.
Ideally, lessees want to make real-time decisions with tangible outcomes. Cancellation options without penalties are ideal. Booming businesses in today’s economy are on-demand: Zip Cars, Pay for View, Cloud Services and Managed Solutions. The array of services and options are endless. Our challenge in the leasing industry is to adapt and provide on-demand services while continuing to satisfy the “hell or high water” funding requirements. Exciting and creative solutions will prevail from the winners.