There is not a day that ends without you having used some form of telecommunication. Initially, telecommunication was in the form of a telegraph, and then came the telephone. Undoubtedly, the telecommunication sector has expanded dramatically due to the significant technological advances in society.
Like any other sector, this has not been without its ups and downs.
Telecom Financing
Financing a telecom company is quite the challenge, particularly for cell tower maintenance services and companies at the initial stages of their business. The telecom companies have to meet the demands of infrastructure, reception and transmission equipment, and more. Here are some of the telecom financing challenges faced by telecom companies;-
Delayed Payment
As per the industry-standard pay terms, telecom services and maintenance companies have to wait for long before receiving payment for work done; some for as long as 90 days.
This becomes an issue as telecom companies require steady and consistent cash flow to employ fresh talent and bi for more contracts. Despite the need for constant cash flow, telecom companies function with little to no help from banks.
Bank Financing May Not Be Right For Everyone
When a telecom company is in its initial stages, it does not qualify for bank financing as it lacks the profit and financial history required to make such a huge step. Besides, since the telecom sector has standard 90-day collection times, banks are not willing to finance.
Furthermore, some business owners are unwilling to work with banks, despite qualifying for a bank loan. The lengthy approval times, capped loan amounts, and rigorous underwriting causes more trouble than the bank loan is worth. When a telecom company does not qualify for a bank loan needs to seek alternative options, such as factoring.
Thanks to an inconsistent cash flow, most telecom companies are now turning to factor companies to provide immediate funds to operations. Unlike bank loans, factoring provides a flexible and almost instant source of cash. Waiting for weeks for approval, as factoring companies provide money within 24 to 48 hours.
Complex Operational Processes
With millions of subscribers and multiple products, operational tasks have become increasingly complicated since face-to-face assistance is not an option. Even simple tasks such as invoicing, processing payments, and service configuration have become challenging.
What’s more, consumers want quick services. They are not ready to go for days without an internet connection or unable to make calls in the name of repair and maintenance. Somehow, this has increased the financial overhead of telecom companies.
Network Security
Technological advances are a good and bad thing. Good because they have made life more comfortable and evil because they have made the internet a site for bullying, identity theft, and many more crimes.
New technologies have brought in new threats to security networks and applications. This is especially true to customers asking for assistance from home and teams working remotely.
In retrospect, the telecom company has to upgrade its operational and technical operations to ensure system security meets customer expectations. This accounts for an added cost for the company.
Increased Demand For Personalized Customer Care
The majority of telecom service providers receive millions of customer requests every day. With the ever-growing number of requests and limited capacity to go to physical stores, delivering quick and empathetic assistance becomes a problem.
During a crisis, immediate, personalized, and omnichannel communication is essential. Ignoring these needs results in extended waiting times, nerve-racking to and fro conversations with multiple executives to get the issue fixed, and unsatisfactory automated responses.
Consequently, your company’s image is tainted as customers walk around with a wrong perception of your services. There is no denying that an agitated customer is every business’s nightmare. Therefore, always ensure you offer empathetic and instant solutions to maintain a cordial, long-term relationship with your customers.
Blurred Margins
With new technologies finding their way into the telecom industry, the variety and quality of services are increasing, profits are declining, and the lines between technology vendors and telecom companies are becoming blurry.
For this reason, telecom companies have to go back to the drawing board to discover ways to up their ICT innovation to adapt their organization to the digital transformation by creating sturdy cross-functional interfaces. Plus, telecom companies have to seek new tools to maintain organizational flexibility.
Conclusion
Undoubtedly, the telecom industry has grown significantly over the past few years. However, the path has not been all smooth, as the companies have had to tackle multiple issues along the way. These include delayed financing, security threats, and the increased demand for personalized care.