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EcoTex Dealer Shared Savings Program. Presented by : EcoTex and Partners Financial Darren Harding. Why?. Easy Sell - No capital outlay is required by Dealer or customer. Difficulty is: “To Good to be True!”
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EcoTex Dealer Shared Savings Program Presented by : EcoTex and Partners Financial Darren Harding
Why? • Easy Sell - No capital outlay is required by Dealer or customer. • Difficulty is: “To Good to be True!” • Dealer has, in effect, taken ownership of customer’s laundry leading to a competitive advantage for chemical, equipment, parts and service sales opportunities. • “Going Green!” Possibly tax and energy credits available for customer.
Quick Overview • Preliminary Savings Analysis • Letter of Intent • Water Meter Installation • Installation of Ozone • Final Savings Analysis • Documentation • Service and Maintenance Implementation
Phase IInitial Qualification Procedures • Step 1 - Dealer proposes ozone to customer based on “Preliminary Savings Report”. • Step 2 – Customer indicates commitment to proceed by executing “Letter of Intent” with Dealer and customer completes a Partners Financial Credit Application.
Phase I – cont’d • Step 3 – Partners reviews Letter of Intent, Preliminary Savings Report, customer credit and project financial feasibility to arrive at a decision. • Step 4 - Upon Partners approval, Partners generates a Purchase Order to EcoTex for ozone unit on behalf of Dealer and Dealer’s customer.
Phase IISavings Validation Test Period and Documentation • Step 1 – Dealer installs water meters for “Initial Verification Period”. (2-4 Weeks) • Step 2 – Upon completion of “Initial Verification Period”, Partners reviews results to reaffirm the project financial feasibility.
Phase II – cont’d • Step 3 – Upon Dealer’s receipt of Partners “Notice to Proceed”, Dealer installs ozone system for actual savings validation. (2-4 weeks.) • Step 4 - Upon conclusion of test period, Partners validates estimated savings and prepares “Shared Savings Agreement” for Dealer and Dealer’s customer. • Step 5 – Dealer meets with customer to review and execute the “Shared Savings Agreement” and the “Delivery and Receipt Certificate”.
Phase IIIImplementation and FulfillmentCustomer Billing, Dealer Payment and Ongoing Service • Partners implements the monthly billing of the customer. • Partners pays Dealer monthly their “Profit and Service Premium”. • Dealer provides Partners proof of performance of their contractual service and maintenance obligations.
Assumptions for Example • Potential customer is an 80 bed skilled living facility. • Potential customer has 2- 60lb Washers. • Average ozone savings is $10.00 per occupied bed per month. • Monthly savings achieved with ozone is $800. • Partners money factor is .0237. • System required is EcoTex ECO35D-II.
$800 Monthly Savings & Ecotex ECO35D-II List Price $14,370.00 • Partners purchases ECO351D2 from EcoTex at Dealer price of $7,185.00 on behalf of Dealer and Dealer’s customer. • Partners will add $1,000 onto the purchase price for installation to determine Partners capitalized cost of $8,185.00 ($7,185 + $1,000). • Upon presentation of a signed certificate of delivery and start-up, Partners will pay Dealer $1,000 for installation. • Partners bills customer $400 monthly for 60 months.
Example Continued • Partners portion (necessary monthly payment) based on capitalized cost is $193.98. • Dealer’s monthly profit and service premium is $206.02. • Dealer’s total profit and service premium over the life of contract is $12,361.20.
Additional Considerations • Sales Tax. • $125 Credit and Documentation fee to Customer. • First and last months payment due as a security deposit. • Partners will pay Dealer via ACH on the 15th of the month following the Customer billing month. • Dealer will need to provide Partners a copy of the Dealer’s quarterly servicing report. • Dealer agrees to share in the credit risk and assist Partners with re-marketing default ozone systems.