Introducing the ADI Card
ADI, Melville, N.Y., launched its new credit card for customers with a promotion of 180 days without interest. ADI has been “working on this forever,” said ADI president, Michael Flink. The company previously offered an open account for its customers with 30-day turns, but it had been looking to be able to offer a line of credit that allowed customers to take advantage of sales and more importantly, help with cash flow on projects with delayed payment.
The card offers 180 days or six months deferred interest with a minimum purchase of $2,500. After the six months, 23.99 percent APR applies.
ADI recognized that because of the economic crisis, funding from banks to small businesses had been more than difficult to come by, Flink said. The company learned from customers that the same cards they were using to make purchases at ADI, they also used to fuel their vehicles and pay for other materials. In projects that stretched for several months, especially government projects, managing cash flow until pay day proved challenging.
Two years ago, ADI started working with major banks in the United States to find a solution that would allow it to offer more flexible payment terms. “During that process, we found that a revolving charge account offered the most flexibility,” Flink said. The biggest problem ADI faced was getting banks to recognize its medium contractors, which were considered high-risk because of the economic downturn in the construction industry. “We were able to use our own strength and partner with T.D. Bank to offer varying credit lines,” Flink said. He expects current trends will continue with some lines of credit in the $30,000 to $50,000 range and a lot in the $10,000 to $20,000 range.
The card was piloted in a few small markets in September and launched nationwide in October. Starting in January, Flink said, customers will be able to take advantage of sales. Whereas without the card a customer may miss a chance to load up on items on sale, the ADI credit card would allow them to stretch the payments over six months without paying any extra charges.