Flexxbuy + Best Way To Offer Customer Financing

I'll start off by stating that incorporating customer financing into your business's sales strategy will increase revenue, regardless of how you utilize it.

Without getting too deep into the weeds, we know that consumers are more financially strapped than they were a couple of years ago. Savings are down and expenses are up. Nearly 100 million Americans have less-than prime credit scores.

The higher the sales ticket price, the harder it becomes for consumers to pull the trigger on a purchase, both from the standpoint of not having a way to pay as well as the stress of depleting any safety net they may have.

It is estimated that 93.3 million American consumers will use Buy Now, Pay Later in 2024 and the numbers are growing rapidly year-over-year. Simply, it's fueling the American economy by closing the gap between people's desire to buy and their liquidity.

As a business owner or manager, the question is no longer whether or not to use customer financing, or buy now, pay later, it's how you use it.

My conclusions are strictly from the standpoint of generating revenue. People make decisions based on other factors, such as comfort level, commitment and availability. You'll have to decide for yourself as to the approach best for you and your business.

A good way to offer customer financing- the "I have nothing to lose strategy"

First, the only bad approach to customer financing is to keep it in the draw and not use it at all. Unfortunately, too many businesses have solutions that fall out of use because they have shortcomings and they let perfect be the enemy of good (see my article on the subject).

The simplest way to utilize customer financing, and also the least fruitful other than not using it at all, is the "I have nothing to lose approach". It's the final Hail Mary before a sale is about to be lost. This is the approach used by most of our clients and it does work because it truly accounts for business that otherwise would never happen. If you are in this camp, that's fine and congratulations, because many businesses are on the sidelines when it comes to rolling up their sleeves and using customer financing to make a sale happen.

But there is a better way.

The better way to offer customer financing- buy now, pay later at point-of-sale

Many business will introduce customer financing once a consumer enters the store or visits their website. It only makes sense. In retail, for example, sales that utilize customer financing have, on average, 25 to 35 percent higher ticket amounts than those that don't use customer financing. Buy Now, Pay Later changes the paradigm of the sale. It converts the strain of finding the money for a large ticket into figuring our what reduced monthly payment will fit into their budget.

The way this approach works is that customer financing is introduced when a person makes initial contact with the business. It makes the flow through the sales cycle much easier because the prospect understands that there is a monthly payment option at the end of the process. It reduces the sales friction.

Many businesses are very successful utilizing this approach.

But, there's even a better way to use customer financing.

The best way to offer customer financing- make it the lead

No doubt, Buy Now, Pay Later has taken over consumerism by storm. One in five American consumers used Buy Now, Pay Later in 2023. And the numbers are growing with no end in sight.

As business owners and managers, it's important that you understand where customer financing really enters into a consumer's consciousness.

In the good way of using customer financing, you're introducing the buy now, pay later option at the point of close, when needed.

In the better way of using customer financing, you're introducing it at the point of sale.

In the best way for your business to utilize customer financing, you're introducing the idea in their home, car or place of employment.

Here's why.

Seventy-seven percent of consumers say financing options influences where they shop and 68 percent of shoppers who desire financing research it online.

Think about that for a moment.

If you have the customer financing option hiding in your draw or even on a wall sign in your business, are you really capturing the consumers who are researching options at home? How about those consumers that are looking at advertising knowing they don't have a lot of money to make a high-ticket purchase? What if they saw an on-line advertisement for something that interested them and within that ad there was a mention that financing is available? Wouldn't that more probably turn a non-prospect into a prospect if they thought there was a possibility of making the purchase and paying over time?

Let's say you're a personal life coach making a presentation or creating a video and your coaching program is high-ticket. You'll probably not want that presentation or video to be shlocky. You want it to come across as high class to help justify the ultimate cost of the sale.

With a high percentage of your targeted audience, the more high brow you make your presentation, the higher chance the presumption will be that they are unable to afford it. They will either click off the video or tune out of your presentation because people will avoid being disappointed. They would rather convince themselves that it's not for them. They will self-talk themselves out of it.

But what would happen if within the first 30 seconds of that presentation you said something along the lines of, "stay to the end because I am going to show you how you can pay for this over time with little or nothing up-front"?

Do you think you would get more people to stay and listen to what you have to sale? For many, you converted the purchase from impossible to possible with one simple sentence.

There is one last friction point that you have to overcome in order to really maximize your sales.

Many consumers will assume that even though you offer financing, they will not be able to qualify and chances are, many won't. Those people will disqualify themselves in order to avoid the embarrassment of getting declined.

You can really open the floodgates in your sales funnel by offering an "Everybody is Approved" or No Credit Check" option. More on that in a future article.

Generating sales is not easy and there are many obstacles, but embracing customer financing or buy now, pay later will give you an advantage over your competition. Remember, you are not only competing with the businesses that are in your market, you are competing with everything else your prospective customer spends money on. You can either make the path to a sale easier or rocky. The choice is yours.

ATurn a clear and bold heading

The Good, Better and Best Way To Grow Your Sales Using Customer Financing

Complete the form below to learn about FLEXXBUY's Customer Financing Options

When Your Customer Needs To Finance The Sale

Flexxbuy Provides One Simple Application That Is Submitted To Multiple Lenders