Estimated reading time: 4 minutes
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.
Offering financing to customers presents equipment vendors and their customers with other benefits. To learn what they are, keep reading this Balboa Capital blog article. It features six reasons why equipment vendors offer financing.
Makes equipment acquisition easy for customers.
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.
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 procure equipment quickly.
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.
Boosts customers’ buying 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.
Increases customer loyalty.
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.
Offers more convenience to 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.
Helps generate repeat business.
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.
What to look for in a business lender.
You have many options if you want to add financing to your list of services. There are direct business lenders that service equipment vendors, many of which have a national footprint and industry expertise.
When evaluating lenders, some things to consider include their time in business, reputation in the market, typical approval rates, lending power, and speed of funding. In addition, some lenders provide their vendor partners with marketing support, such as private-label financing applications.
The opinions voiced in this material are for general information only and are not intended to provide specific advice or recommendations for any individual.