Buddy, got a dime? Did you ever think you could increase sales, profits, and the almighty cash flow for a ten cent investment?
More about that 10 cent investment requirement later ; but we’re talking about utilizing a customer financing program, often called a dealer or vendor program, for assisting your clients in financing their purchases – of your products and services .
When Canadian business owners and financial managers think of acquiring assets from their vendors / suppliers almost 80% of all businesses consider lease financing as a financial mechanism to acquire that asset. But wait a minute… lets turn that situation around; aren’t in fact yoru own clients thinking about financing options when they are looking to acquire YOUR products and services. You’ve proven they do, if only because you do it also.
So is the price of any product or service one of the critical aspects of any firm considering a purchase of any type? You bet it is. In fact in surveys we have seen for years ‘ price’ actually becomes an ‘ obstacle to innovation ‘ – a term we’ve grown quite fond of.
So are you in a position to remove that obstacle to innovation that your clients are experiencing. You are in fact, if you choose to develop a customer financing program. This type of program allows your customers to match reasonable cash outflows with the benefits they receive from your product.
There are a couple of different ways you can do this, so let’s cover them off. Our favorite is the ten cent investment scenario we discussed earlier, but in fairness to all parties let’s ensure you understand all your options.
You have the choice of actually forming your own finance firm or division – for many major manufacturers this in fact is almost a must. Think of what GMAC did for GM… Namely allowed their clients to finance millions of cars over the years… how by offering them financing or subsidized financing.
The reality for small and medium sized firms in Canada is that they are probably better served by aligning themselves with an independent third party who has day to day expertise in offering customer financing and funding to customers such as yours. They have the expertise and business model in place
As we said earlier the benefits of a dealer / vendor program (you in effect are the dealer/vendor) are significant. Very significant. They include increased sales, a total solution perception by your customers (i.e. product/service/financing) and lower inventory levels due to the fact that sales turn around faster, bottom line… what they call a faster sales cycle.
So how is it possible to do all these great things on a ten cent investment? Well we’ve estimated 10 cents as the cost of a phone call, and if you seek out and call a trusted, credible and experienced Canadian business financing advisor with significant lease experience you will be in a position to implement a full customer financing program at no cost.
That advisor will work with you to identify a financing partner(s) that you are comfortable with, thereby ensuring you can use vendor funding for any size of deal of credit quality in your customer base. Many programs can be ‘ tweaked ‘ to ensure you have numerous other small benefits that add up to a significant amount of what lessors call ‘ control’ in your customer base. That might include upgrade programs, end of term programs, or Zero per cent financing subsidized by yourselves to increase sales for a short period.
So is that ten cent investment (isn’t calling even cheaper than that these days?!) worth it. We’ll let you decide. But your competitors are doing it, so if more sales, increased profits, and a faster sales cycle appeal to you consider making that call for a customer financing program.