Ann: Vivid Industrial adds recurring 'Save & Share' revenue-GER.AX, page-4

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fourdollars

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28/07/16

10:16

Post #: 18385518
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Originally posted by fourdollars ↑

I'm sure the only reason you hadn't heard of it is because it didn't exist ...

Smells of desperation. Its a terrible way to deal with customers. You have the upfront capital issue, but then you've got to send an invoice every month / quarter, whatever, and hope that the customer pays. Meanwhile, there will be all sorts of machinations around how much the customer is saving, how this changes as their lighting requirement changes over the 10 year contract, what happens if they source new forms of electricity generation etc ...

You "partner" with someone you continue to provide goods / services to, and they pay as you deliver. this works because they keep getting something new or improved and you keep getting money. You don't partner with someone where you do all the good stuff up front, and then try to collect payment over the next 10 years.

The guy at the client who did the deal (and loves Vivid) leaves. The new manager inherits the Vivid contract, inherits a budget where the Vivid savings have already been factored, and just views Vivid as a monthly cost.

Terrible, terrible strategy.

I suspect the imminent quarterly report is about to confirm that they are about to run out of money again and this announcement was a lame attempt to pump the price before they announce another cap raise.

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Converting shareholder equity into revenue is just not a sustainable business model.

GER Price at posting: 8.0¢ Sentiment: Sell Disclosure: Not Held
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Ann: Vivid Industrial adds recurring 'Save & Share' revenue-GER.AX, page-4

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