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- December 15, 2013
- by Tamra Schneider
- contractor financing, financing, home remodeling, home renovation,
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Offering financing to customers is one way your business can increase order sizes and drive additional sales. Ever wonder why car dealerships advertise low monthly payments to attract buyers? It’s because they know financing increases their customers’ buying power and is an easy way to boost their sales in a down economy.
Home remodeling projects are the third largest investment that a consumer will make in their lifetime, behind a house and a car. According to a 2012 report by Pitney Bowes, the average savings account balance in the U.S. is $5,923. And Bankrate.com reported that 28% of American families have no savings and another 20% don’t have enough saved to cover three months’ worth of living expenses. That’s nearly 50% of U.S. consumers that wouldn’t be able to afford your product or service without the use of financing.
The following are five reasons to consider offering financing to your consumers.
1. It Provides Incremental Income. Most customers think about how they’re going to pay for a purchase while they’re still shopping. And if they know they have the flexibility to buy now and pay later, they are more likely to add additional items or upgrades they may have otherwise passed on.
2. Gives the Buyer Flexibility. Give your customers options, it’s likely that extending their payments over 6, 12 or even 24 months will make them feel more at ease with the purchase and it’s affordability.
3. It Builds Customer Relationships. Building customer relationships and improving customer retention are key benefits of offering a finance opportunity. It allows you to build rapport and trust in addressing the customers’ financial issues and offering them a more affordable solution.
4. It Creates Value. Offering financing creates value for your customers by saving them money, getting them better terms and into a more comfortable monthly payment.
5. It’s a Growing Trend. Every major consumer business is doing it, from car dealerships (KIA, Volvo, Ford), to department stores (Macy’s, Sears, Apple), to major retailers (Home Depot, Best Buy). The growth of this trend is largely due to the benefits derived from offering financing and its impact on businesses.
There are many great financing companies out there, I’ve had the pleasure of working with a few:
FTL Finance provides HVAC/Plumbing/Electrical contractors with an easy, simple consumer financing solution. They have many flexible products and deferred interest plans up to 12 months. Visit http://ftlfinance.com/
AMS Financial serves over 25,000 contractor partners nationwide and provides their customers access to the most innovative and competitive finance programs in the market. Vist http://www.homeimprovementloanpros.com/