Financing can help you increase sales, revenues and customer retention. You'll be able to secure more deals, accelerate sales cycles, protect and increase your margins, and reduce debtor days. In addition, you'll be able to overcome cost objections, provide customers with a value-added service, and generate more profitable, longer-term relationships. There are four major areas of benefit to you through establishing a sales financing programme:
1. Marketing Enhancement
- Help sales staff to overcome equipment price objections
- Product Differentiation - equipment plus finance may differentiate you from your competitors
- Pricing Differentiation - selling your equipment on a pay-as-you-use basis, or a revenue-share basis can also differentiate your product offering
- Competitive Response - your competitors may already offer leasing or innovative pricing schemes
- Market Penetration - a special financing campaign could be useful when launching new products or prolonging the demand for a mature product
2. Marketing Control
- Account Control - finance is used extensively by vendors with fast-changing technology. For example, leasing allows customers to upgrade and replace equipment easily with just a simple adjustment in rentals
- Barrier to competitors - if it's so easy for your customer to keep trading-in and trading-up with you, your competitors do not get a look-in
- The second-hand market can be controlled
3. Additional Income
- The technique of up-sell works well with finance because the removal of a budget constraint allows customers to afford more than they thought
- Maintenance can be made a condition of the financing arrangement, increasing your profits from support activity
4. Accounting & Administration
- Vendors finance departments can often be under pressure to use in-house resources to finance deals for cash-strapped customers, adversely affecting their cash-flow and balance sheet
- Dealing with problem sales can also take up valuable management time whereas a financing solution can overcome this
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