Business Powerhouse Courts Smaller Firms

In a move to help mid-sized companies finance investments in technology products and services, SAP AG has launched a new interest-free leasing offer.

The offer, which is being rolled out in Germany first, allows small and medium-sized business customers to lease software and hardware as well as implementation and consulting services for a three-year period, interest free, SAP AG says.

"Although this financing program will initially target companies in Germany, we aim to extend it to other countries because we see a need to provide financial support," says Ralf Nitsch, a SAP spokesperson. "But we can't announce any other countries and launch times today because we have to examine the legal situation in each country."

Conditions could vary widely from country to country, according to Nitsch. "Some countries may have restrictions on interest-free leasing offers altogether," he says. "This is something that our subsidiaries and their partners will review."

Partners On Board

SAP is using its Business One and All-in-One initiatives to determine which companies may be interested in its zero-interest leasing program. Many of these companies, particularly in Germany, are struggling to retain existing credit lines or tap new ones with banks amid sustained economic gloom, SAP says in a statement.

In charge of the initiative in Germany is De Lage Landen Technology Finance, which is also collaborating with Fujitsu Siemens Computers, Hewlett-Packard, and IBM as well as SAP and its distribution partners.

"We and the other partners have agreed to absorb the costs that De Lage Landen incurs when securing loans to purchase the hardware and software products, which they turn around and lease," says Michael Schmitt, director of SMB operations at SAP Deutschland. "We view this as a totally new model because it offers attractive conditions that keep interest rates at zero percent."

The leasing initiative, which was inspired by SAP, isn't limited to software products developed by the German company, according to Nitsch. "It includes operating system software and other software products needed to run SAP systems," he says.

As global SAP partners, Fujitsu Siemens, HP, and IBM will be involved in similar leasing programs in other countries, according to Nitsch.

Small Business Options

The All-in-One program, targeting mid-market companies, is based on a scaled-down version of mySAP Business Suite. That software package is SAP's cornerstone line of enterprise software products designed for large corporations. The program, which runs on a variety of operating systems, has around 4200 customers of whom 1700 are in Germany, according to the company.

The Business One program focuses instead on small firms. It includes modules for sales force automation, financial management, and inventory management. The program, which runs on Microsoft Windows, has 1600 customers. Of those, 150 are in Germany, SAP says.