Equipment vendors must close deals to grow, expand, profit, and stay competitive in their respective markets. Sales provide the revenue needed to cover expenses, pay sales managers and support staff, and reinvest in the business. Plus, sales allow vendors to build customer relationships that may result in repeat business and increased loyalty. For these reasons, business-savvy vendors offer financing options to their customers, which is a proven way to increase sales and add value to their companies. Customers today see financing for what it is, a valuable cash management tool. Financing is no longer an alternative you grudgingly accept only when you've got to have it now and cash is limited. Offering financing to customers presents equipment vendors and their customers with other benefits. To learn what they are, keep reading this Union Commercial Capital blog article. It features five reasons why equipment vendors offer financing.
Increased Affordability
Offering customers an easy, flexible purchase option is one of the most important reasons to provide financing. Prospects who visit your showroom or lot have a good idea of what they want, and presenting them with custom-tailored financing options and repayment terms can help you and your sales managers close deals. Paying for the total cost of equipment in cash is not accessible to most small to mid-sized businesses. Normally, that's not a fault of the pricing but rather the reality of the industries producing needed equipment. Many businesses would purchase more equipment if they could afford it, while others are priced out of purchasing the equipment their businesses need entirely because they don't have the liquid capital for it.
If you don’t offer financing, the path to purchase will lengthen because prospects will need to crunch numbers and decide how to buy the equipment based on their financial situation. Additionally, prospects might take their business to a competing vendor that sells equipment with financing options.
Helps Businesses Acquire Equipment Faster
Small businesses need the right equipment to stay competitive and boost profits and market share. In some cases, companies need to procure equipment right away. For example, if a critical piece of equipment malfunctions or breaks down, it can disrupt production and negatively affect the bottom line. Fortunately, equipment financing solutions provide a fast and efficient way for businesses to access capital quickly and easily.
It is an ideal solution for those who want quick access to capital without the hassle of long wait times or complicated paperwork. If financing is part of your product offering, customers won’t need to look for an outside lender, and they can quickly secure funding to finance the equipment you sell.
Increase Your Customers' Purchasing Power
Business owners who finance equipment often spend more than they initially budgeted for. The reason is that financing can give business owners more buying power than a one-time cash purchase. As a result, they can finance newer and more feature-filled equipment with higher price points.
So, by offering financing, your vendor business can attract more customers who would otherwise be unable to purchase higher-priced equipment due to budgetary concerns or financial constraints. You and your sales team can close more significant deals while your customers outfit their companies with leading-edge equipment.
Improve Retention
Offering financing options to customers can be a great way to increase customer loyalty. Presenting financing solutions to your customers when they are ready to move forward shows that you put their needs first and have everything covered.
You and your sales team members can provide more personalized services that meet your customers’ specific needs, particularly financing-related ones. This helps create a sense of trust between you and your customers, leading to increased loyalty and long-term customer relationships. Customer retention is vital for any equipment vendor business that wants to improve its bottom line. It is about keeping customers happy and loyal and creating a steady revenue stream for the company. By offering convenient financing solutions to customers, you can establish your vendor business as a preferred resource for the equipment you sell. This can lead to increased sales, repeat purchases, and referrals. Of course, all of these sales translate to increased profits.
Make The Process Easier For Your Customers
Today’s business owners wear many hats and are busy managing their day-to-day tasks. So, they want the convenience of an efficient financing process when investing in business equipment. If your vendor business is a one-stop shop for equipment purchases, financing, and customer support, your customers will be afforded optimum convenience. Customers can peruse your showroom or lot to evaluate your inventory, select the equipment they want, and apply for financing on the same visit.
Next, you can provide customers with more convenience by working with a business lender specializing in equipment vendor financing. Some lenders can expedite funding swiftly for approved deals with their own application, borrowing requirements, and credit-scoring technology.
The Bottom Line
Equipment financing makes your equipment more affordable, which creates an opportunity to sell more. Not only is the affordability appealing to your customers, but promotions and strong relationships will keep them coming back for more equipment when they are ready to grow or replace what they currently have. With financing, your customers' businesses can grow faster because they are not going to expend their capital on a singular piece of equipment and can invest their capital in multiple pieces of equipment to increase their revenue and efficiency faster.
A bonus is that if your customers exhibit an indecisive approach, Union Commercial Capital keeps the deal moving through our easy process. When you offer financing, you are not only getting more sales and increasing your customer base, but you are also bring in a third-party that understands and supports your business's needs and goals.
Want to increase your sales by offering flexible payment options to your customers? Contact us today to get started.
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