Based in Maryland, Chesapeake Systems (CHESA) is a full-service technology systems and solutions provider, specializing in optimizing media workflows from creation to distribution and preservation.
About Chesapeake Systems
The Situation
CHESA’s customer — a large Fortune 10 multinational corporation — was seeking to acquire $1 million worth of studio editing hardware and software technology solutions to help with their innovative advertising. It was important to the customer that they avoid ownership of the solution, and simply have access and use of the technology. No ownership would ensure an asset-light impact on the customer’s balance sheet so they could simplify budgeting and keep capital freed up for other business priorities.
To deliver on this requirement, CHESA would need to assume product ownership. But prior to providing the solution to their customer, CHESA required a 50% down payment ($500K) to preserve their own cash flow.
The Solution
CHESA met with the Arrow Capital Solutions team for guidance on how to help their customer. Arrow offers customized and flexible financing solutions that support the speed of the IT channel, and the needs of our channel partners and their customers. As a leading global distributor, we are uniquely positioned to offer convenient payment choices that help businesses acquire the technology they need to grow.
Arrow worked together with CHESA and their customer’s legal team to develop a highly customized contract, ensuring it met the needs of both the IT solutions provider and their customer. For CHESA to get the financial backing needed for the 50% down payment, we structured an OpEx lease solution with no path to ownership for their customer. Arrow funded the 50% down payment to start the project.
The Outcome
Working collaboratively with Arrow Capital Solutions, CHESA was able to win this $1 million contract with the Fortune 10 customer. Through the OpEx solution delivered by Arrow, CHESA’s customer was able to realize the benefits of the studio editing technology immediately, while securing a predictable payment plan over time and avoiding the significant upfront investment.
As a small business, CHESA benefited from Arrow’s support on the down payment, as it allowed them to procure the components needed to build the overall solution for their customer. The contract terms established that the solution would be paid by CHESA’s customer in four quarterly payments over a one-year period.
Through this financing effort, Arrow helped establish a framework that sets CHESA up nicely for capturing potential repeat business from the large corporation in the future.
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