Blue Chip Engineering: pay as you go, flexible financing wins the day
“The proposal from Virgin Media Business was the only one that included financing. It was the most important factor in our decision to award the contract to Virgin Media Business.”
Andy Rounding, Finance Director, Blue Chip Engineering
To manage higher than expected costs during the build of a new data centre for delivering Infrastructure as a Service to customers.
Virgin Media Business Digital Solution
We offered low cost financing option over three years.
Better use of working capital, improved cash flow and payments offset against new revenue.
Digital aims and operational goals
Established in 1987, Blue Chip Engineering’s growth has been rapid. However, continued success meant that strategic investment was needed to satisfy the needs of their growing customer base. Their capex budget needed to be utilised very wisely to meet their requirements and make the investment a viable long-term solution. But compromise on quality wasn’t an option either.
When we presented them with an alternative financing plan which did not result in a reduction in the quality they required, Blue Chip saw that their vision could easily become a reality.
Blue Chip Engineering planned the build of its new data centre very carefully. However, as unexpected costs rose, the pressure on the budget grew heavier and the project looked as though it may overspend.
Blue Chip’s business was growing. Fast. Its’ ‘Infrastructure as a Service’ (IaaS) business was becoming increasingly important.
To embrace this growing opportunity, Blue Chip embarked on an ambitious and challenging project to build a new state of the art data centre. The data centre needed to be both highly resilient and extremely energy efficient in line with leading industry standards. As the project progressed, unforeseen power requirements came to light, creating the need for extra equipment. Then, for all the right reasons, more backup systems had to be added to achieve the required redundancy. And so the company was presented with a potentially significant increase in spend in order to reach their objective.
At Virgin Media Business, we love a challenge. We also love working with our customers. So, when we presented a competitive ‘pay as you go’ financing proposal for delivering a local area network solution into their data centre, Blue Chip was delighted with the option. The solution helped to overcome their budget constraints and was structured so that Blue Chip paid for the network as it generated revenue.
Blue Chip Engineering was an existing customer. We had a great relationship and were already providing Wide Area Network (WAN) and Internet services for their two data centres in Bedford. So it was only natural that they asked us to quote for their new data centre network.
Blue Chip already had a data centre network design. But our engineers worked closely with them and were able to suggest ideas for meeting longer term requirements. Even better, the end solution allowed the same services to be provided with less equipment. The result? A solution that not only reduces power and cooling requirements, it also lowers the amount of management and maintenance.
With Blue Chip’s budget under pressure, we needed to help them find an affordable solution. Cisco, Blue Chip’s chosen network equipment provider, were offering flexible financing packages. So putting heads together we were able to offer 36 monthly repayments, interest-free credit on half of the equipment, and a highly competitive rate on the other half.
It doesn’t end there. As it turned out we were the only company to include financing in our proposal. It was a major reason that Blue Chip awarded us the contract. Now, they could install the data centre network without spending the rest of their capital budget or compromising on quality. The remaining budget could be allocated to other parts of the business. A real result.
Blue Chip’s new data centre is up and running. Using about 97% less power than other data centres it’s not only highly resilient, but also one of the most energy efficient facilities of its kind in Europe – they are well on the way to meeting their carbon neutral objectives.
The data centre is already providing services to new customers and Blue Chip is in the process of moving over existing customers too. Blue Chip is confident that its investment has provided a competitive advantage that will enable it to bring many more customers on board in the future.
“Although we chose Virgin Media Business first and foremost because of its insight in proposing a financing option, its maintenance and technical competence came a close second. Its staff have been consistently helpful and knowledgeable throughout the process,” said Phil Bindley, CIO at Blue Chip Engineering.