Cisco focuses on SMBs

BANGALORE, INDIA: Networking major Cisco today announced the launch of '0% Financing for Cisco Multi-year Services Program' in India to help small and medium business (SMBs) meet the rising demand for technology to succeed in business.

Announcing the simultaneous launch of Cisco's innovative 0% financing program in the APAC region including Hong Kong, Korea and China, G.B. Kumar, senior vice president, Customer Advocacy, Cisco, India & SAARC, said that the zero percent financing program testifies Cisco's continued commitment to helping SMBs transform their businesses with technology, while lowering the total cost of ownership (TCO) and enhancing the value of technology investments with flexible payment options and lowered threshold for advanced network services.

"Cisco is financing the services needs of SMBs. This is an interesting trend in the industry. Service offerings from Cisco will become more critical in terms of taking the challenges forward," he said.

"Advanced technology is a key differentiator that can help businesses enhance competitiveness in the market. SMBs, like multinational companies, are looking to technology to improve business agility, operating efficiency and staff productivity," he said, adding, "However, one of the biggest challenges for SMBs in their budget constraint, which hinders timely decisions on technology procurement and deployment, and as a result affects their business development."

"As part of our commitment to the SMB market, Cisco Services strives to bring to SMBs sophisticated services and solutions that have long been only affordable by larger enterprises. With the introduction of these competitive offerings, we expect to see considerable growth in the SMB market," Kumar said.

Most SMBs have realized that technology is critical to enhancing their competitiveness in the market, but on the other hand, many of them see technology as an expense that puts pressure on their company cash flow. The '0% Financing for Cisco Multi-year Services Program' has been specially designed and introduced for SMBs to help them deal with this dilemma," said Gautam Munish, vice president, Cisco Capital, India & SAARC.

"The 0% financing program is offered by Cisco Services and Cisco Capital. While Cisco Services aids SMBs in realising the challenges of investment in new technologies, IT support and managing competitive advantage, the Cisco Capital division helps in cost control, cash flow and managing TCO," he added.

The program provides SMBs with immediate return on investment (ROI) by allowing them to align their expenses with monthly revenue. It also helps lower TCO for a company, enabling effective management of cash flow and resources. With multi-year services contracts, SMBs can lock in current services pricing for years and eliminate the hassle of contract renewal.

Cisco Services offer an investment-free financing package for multi-layer service contracts for SMBs purchasing technical services, SMARTnet and the advanced services program with a minimum deal size of US$ 50,000 net per annum in India. It addresses the budget concerns SMBs face, Munish explained.

"Through the '0% Financing for Cisco Multi-year Services Program', we will be undertaking interest rate risks and also write technological risks. We end up taking residual risks in our kits," he added.

"Cisco will be helping companies hedge themselves against technology obsolescence. It is pretty innovative in the industry at zero percent," Munish said.

The '0% Financing for Cisco Multi-year Services Program' will be operational for a year as of now. "Based on the success of the program and the budget available to us, we will see if we can take the program forward beyond the 2009 fiscal (July 2009)," he said

Meanwhile, for the last on year Cisco has also been offering a special financing scheme for SMBs on purchase of products at a special rate of seven percent. "This is almost 50 percent lesser than the market rate. We have had good deal of business through this scheme with around 70 customers in India," said Munish.

In all, Cisco's initiatives to finance products at a lesser interest rate and at zero percent for services will take care of the technological as well as the credit pain points of SMBs, he added.