Equipment financier DLL has expanded its floorplan financing offerings to include utility trailers as the company looks to grow its vendor financing business.
A subsidiary of Netherlands-based Rabobank Group, DLL in mid-June added utility trailers to its current floorplan offerings in the agriculture, construction and recreation spaces, Mike Malone, head of new business development and product management for DLL Commercial Finance, told Equipment Finance News. While the financier already works in the utility trailer market through other industries, it will now work directly in that space.
“It’s taking our methodology that’s been so successful within DLL and applying that methodology to an industry that we already are working in, but with a product that’s more adjacent,”Malone said.
Utility trailer floorplan competition
Lenders such as Mitsubishi HC Capital, Northpoint Commercial Finance, Triad Financial Services and Wells Fargo Commercial Finance already occupy the utility trailer space, but DLL sees opportunity for its vendor finance approach in the market, Malone said.
“There are some major players in the utility trailer space, but there’s also a lot of smaller players, so it’s a matter of finding how we best serve that market and the dealers that come with it,” he said.
Still, increased competition also benefits manufacturers, dealers and customers, Malone said.
“You need more than one or two finance companies in the industry because if something were to happen or one shifts directions, … you cannot stifle an industry based upon providing credit,” Malone said. “When you have other options out there providing floorplan lines, it allows for manufacturers to have a sense of security to know that their dealers have availability to stock their products.”
Balancing the financing chain
DLL’s addition of floorplan financing for utility trailers also positions it to operate in both halves of the financing chain, Malone said.
“We’re focused with the utility trailer manufacturers out of the gate to help them with the first part of that financing chain, which is getting their equipment into the dealer’s hands to be able to stock it,” he said. “If you’re not able to finance into the dealers, they have no product on the lots to sell, then it becomes very hard for the end user to do the retail financing.”