PNC Equipment Finance:  A Value-Added Approach

Dave Keener at PNCEF explains success lies in understanding the evolving market issues, the potential impact to customers and then providing a value added solution.

Equipment Finance Advisor:  Within your institution’s equipment leasing and finance operation, what was the single most prevalent market change or market condition your group had to adapt to over the past 18 months?

David Keener:  If I had to sum it up, I would say they would be the increased market competition and significant downward pressure on pricing, increased residuals and lessee favorable documentation.

Equipment Finance Advisor:  Keeping your answer to the question on adapting to current challenges in mind, describe an innovative approach and/or strategy your institution developed to address this market condition or market change.

Keener:  Our primary strategy is to develop new opportunities by bringing ideas to customers.  The goal is to provide ideas and solutions to our customers that allow us to win transactions based on value add rather than on price or residual. This means understanding the company and issues it may be dealing with and presenting solutions to the customer. For example, a tax lease may make sense to a customer in a Net Operating Loss position where as a capital lease may help an insurance company manage its non-admitted assets. Large fleet programs may require specialized administrative requirements. Taking time to review a customer’s financials and fully understand their business prior to a customer meeting is our approach to identify issues a company may be managing and to allow for a more productive meeting.

Equipment Finance Advisor: How did this newly developed and/or innovative strategy help your group win new business and how will it be further developed as market conditions continue to evolve and change?

Keener:  By bringing solutions to our customers, such as managing large transactions, tax management or accounting solutions, we have been able to provide customers with a value added solution. In some cases, this helps us to avoid the typical RFP process because it’s our solution that the customer wants. Often times this allows us to structure a transaction that is a win for both the customer and PNCEF. This is also a great way for establishing long-term relationships with those customers.

The success of this strategy requires that sales personnel within PNC Equipment Finance understand evolving market issues and how those issues impact our customers. For example, it is important that our sales people understand the status of FAS 13, can discuss NOLs and AMT and other accounting/tax issues a customer may have. It is also important to provide quality support services. The ability of the support staff to provide the customer with its administrative requirements in an efficient and professional manner is another way that PNC Equipment Finance differentiates itself from competitors. I think that our best sales tool is a well-versed sales and support staff that can educate the customer and deliver results as promised.