Acquiring the Bombardier snow groomer business and entering the North American market in 2005 created a variety of opportunities for Prinoth. To capitalize on Bombardier’s existing customer base, Prinoth retained almost all of the acquired company’s sales force along with six sales and service centers near major ski areas in North America.

Since a typical groomer costs about $250,000, Bombardier’s customers often financed their purchases through the company’s in-house financing arm. Bombardier customers welcomed ready access to financing and sales team members included financing as part of a total-cost approach to equipment acquisition.

In Prinoth’s stronghold, the European market, slope operators don’t expect equipment-suppliers to offer financing. They generally prefer self-financing or making their own arrangements through traditional financing sources. As a result, Prinoth does not have a captive financing arrangement.

In order to effectively compete in the promising North American market, Prinoth needed to find a financial services partner with the resources, knowledge and commitment to meet the needs of both customers and the sales force.

Shortly after the Bombardier acquisition, officials at Prinoth’s U.S. and Canadian operations began to search for financial services partners. They met with a variety of potential providers, including members of the CIT Vendor Finance team. CIT’s expertise as a global leader in developing sales-aid solutions for manufacturers and distributors in a wide range of industries made it a leading candidate.

Because of CIT’s extensive experience, financing specialists from CIT Vendor Finance’s Diversified Industries team were able to propose a custom financing program tailored to the unique needs of Prinoth and its customers.
 
The program they developed gives Prinoth all the benefits of a captive in-house financing operation, without the associated administrative costs. In partnership with Prinoth sales professionals, CIT financing specialists work directly with equipment purchasers.  Most buyers want terms that extend over several seasons and take the seasonal nature of the ski slope business into account. With extensive experience in other cyclical industries, CIT can easily accommodate these requirements; CIT also can provide an operating lease, if the customer desires.

Prinoth was also attracted by CIT’s highly efficient processes that enable fast decision making and responsive customer service.  CIT handles all the paperwork and administration, freeing Prinoth salespeople to focus on their primary task – developing new business.

Since Prinoth chose CIT as its financial services partner for both U.S. and Canadian operations, CIT has funded a wide range of lease and loan transactions for Prinoth customers, and the list is growing.

In addition, CIT bought out the remaining Bombardier portfolio to capture a customer base for repeat business.  Prinoth’s most significant market entails replacing older machines, with high hour-usage and repair bills, with new and more efficient groomers.  Prinoth has seen very high repeat business with customers. CIT has financed new equipment sales ranging from $250,000 to more than $2.8 million per customer. In 2008, this relationship should earn CIT more than $10 million between the U.S. and Canadian operations.

The Prinoth-CIT partnership has had a significant impact on Prinoth’s sales growth in North America. Prinoth has expanded its service capabilities and opened a new North American headquarters in Granby, Quebec. It also is expanding its North American workforce to include more than 75 employees. Prinoth also plans to expand its product portfolio by introducing some European-made groomers in North America.

The company’s prospects are good, given positive indicators like heavier winter snowfall and the increasing popularity of winter sports in North America. The 2010 Winter Olympics in Vancouver will surely drive more interest to winter sports as well.