Sometimes we get so focused on the job at hand that we lose sight of the importance that job has on the people we’re doing the work for. Take some office equipment dealers and their financing solutions, for instance.
Dealers may see financing solutions as a method to facilitate sales – a way to make solutions more affordable in an increasingly price-competitive market. And while they’re right about that, they’re missing a big part of the story.
It’s a simple case of cause and effect.
Dealers could be more effective in selling their finance solutions – and solutions in general – if they focused less on the fact that financing powers sales and more on why financing powers sales.
So why does financing power sales activity?
Financing creates predictable expenses.
They say cash flow is king because it is. We understand that our customers need an affordable monthly payment the same way we seek that in everything from our own mortgages to our cars to even our mobile phones. Predictable revenue and expense streams allow your customers to more easily run and grow their businesses. Unpredictable cash flow spikes damage businesses the same way an unexpected $2,000 healthcare expense or $4,000 transmission repair impact us. Predictable expenses make it easier to meet payroll pressures, stay current on tax obligations, buy inventories, and service customers.
Financing preserves cash.
If each time you purchased a new truck you had to shell out $45,000 in cash, you’d buy fewer or cheaper trucks…or both. But 100% financing gives customers a more effective way to acquire the technology that powers their businesses without the limitations or drain on cash reserves. And don’t sleep on the impact of opportunity cost. If business owners can invest in a new salesperson or marketing campaign that typically drives a good return on investment, why would they invest the same cash in rapidly depreciating technology that generates less ROI? Think of it this way: if you could borrow for that new truck at 8% and get a 15% return on the tens of thousands of dollars in upfront cash you hold onto by financing, why would you use cash to buy the truck?
Financing gives them a predictable way to stay on the cutting edge of technology.
It’s a big challenge for businesses to determine when to invest in new tech. But a well-structured financing program (especially when married with your service agreement) gives your customers a program of technology replacement. At the end of each term, they simply upgrade to the newest technology and replace the new finance payment for the old one in a seamless transition. Without financing, the cash spikes of the technology upgrade cycle often keep customers from upgrading at all. Instead, they extend the life of technology investments to the point of inefficiency. And that isn’t the only cost of outdated technology. In fact, recent research shows that companies that finance technology have lower employee turnover because employees have better tools to do their jobs.
It’s not just that financing powers sales. It’s why financing powers sales. More effectively meeting payroll or tax deadlines, keeping employees happy, and allowing you to invest precious cash reserves in areas that can provide the best return are just some of the incredibly powerful reasons customers seek a financing alternative for your solutions. And in an increasingly as-a-service world, the more time you spend with the real benefits of a payment structure, the more you’ll take care of those sales goals.
So, tell customers you can help them afford to hire new sales staff or invest in technology to create a superior customer experience. Financing drives their strategic imperatives, and that’s what you sell – not just a payment for an MFP.