Here are two ways to use a retail finance program to your advantage. Yes of course you use it to sell higher ticket items, but manipulating the terms can give you some benefits.
First is another creative trick to use to raise capital fast, unlike my last post (leveraging your credit score to get large limit Business credit cards), this method puts you at ZERO risk. You have nothing to pay back, and you need zero qualifications.
I just thought about it today in all honesty.
Someone had contacted me about receiving funding, but really he has zero sales, in his first month, and to make matters worse, live in Pakistan.
The honest truth is when you live in many countries there isn’t a lot you can get, if anything at all. Pakistan it turns out has a small business start up loan program but it caps out at max $12,000 USD, and lets face it those are hard to get anyway like all loans I'm sure.
So how do you acquire capital when you have zero qualifications for it? This includes all citizens of every country. This will work if you target US customers.
Here's the TLDR: Charge a lump sum for a years worth of service (or a large order of product), at a discounted rate, and use a 3rd party installment/financing plan so that the customer can pay lower monthly rates, make the sale more attractive to the customer.
Yes it might take some time, but each sale you make will result in a lump sum of cash which you can reinvest into the company much faster then waiting on monthly payments.
Everyone benefits. You get a lump sum of cash upfront (which you can now invest back into the business). The customer pays a lower monthly fee.
This works best for services with low cost, where the principle investment is your labor/time.
Detailed example:
Lets say you sell some service/consulting for $500/month. That’s $6,000/year. You offer the customer a deal, he can pay $4.000 upfront and save $2,000. Great but not everyone wants to lay out that cash (and if they do, great, you just made $4,000!)
If they decline, you point them to the 3rd party finance program. The financier pays you $4,000, and the customer pays it back over the course of a year. You just gave the client the benefits of your monthly plan at the cost of your yearly discount and you made a lump sum.
This can also work with products, especially small time wholesaling. Do you distribute to re-sellers? Are they purchasing only 100 units at a time in cash? Put them on a finance plan, now they can make larger inventory purchases, you get more cash upfront, and they pay in monthly installments just as if they were paying previously month by month for product.
They can put a little bit upfront, receive and sell off their new inventory, and pay the loan back early with the money they made in sales.
The caveat to this is that the US resident must have fairly decent credit, but there are programs for lower scores too.
Here’s another way to use financing to help sell:
Let’s say you are a digital marketer. Lets say you are offering a Facebook ads program, you charge $1,000 and the customer provides $5,000 in ad spend. (My prices are examples I have no idea what to charge for that ha)
Become his financier!
Maybe he WANTS to run those ads but doesn't want to shell out a full $6k, but that ad spend is a fixed cost, you can't negotiate it. You sense his pain point and losing the sale is a possibility.
Point him toward your finance plan, he can get the entire $6,000, you're going to offer to finance his ad spend!
Tell me you wouldn't make more sales in that scenario.
Maybe I’m wrong, but people buy more when they can pay less over time.
The only key to this plan is you must sell it.
I hope this helps some people, it requires hustle and active selling to the client, but then again all business does in some way.
If you can sell your service, no doubt you can sell it for cheaper with a finance plan in place too.
First is another creative trick to use to raise capital fast, unlike my last post (leveraging your credit score to get large limit Business credit cards), this method puts you at ZERO risk. You have nothing to pay back, and you need zero qualifications.
I just thought about it today in all honesty.
Someone had contacted me about receiving funding, but really he has zero sales, in his first month, and to make matters worse, live in Pakistan.
The honest truth is when you live in many countries there isn’t a lot you can get, if anything at all. Pakistan it turns out has a small business start up loan program but it caps out at max $12,000 USD, and lets face it those are hard to get anyway like all loans I'm sure.
So how do you acquire capital when you have zero qualifications for it? This includes all citizens of every country. This will work if you target US customers.
Here's the TLDR: Charge a lump sum for a years worth of service (or a large order of product), at a discounted rate, and use a 3rd party installment/financing plan so that the customer can pay lower monthly rates, make the sale more attractive to the customer.
Yes it might take some time, but each sale you make will result in a lump sum of cash which you can reinvest into the company much faster then waiting on monthly payments.
Everyone benefits. You get a lump sum of cash upfront (which you can now invest back into the business). The customer pays a lower monthly fee.
This works best for services with low cost, where the principle investment is your labor/time.
Detailed example:
Lets say you sell some service/consulting for $500/month. That’s $6,000/year. You offer the customer a deal, he can pay $4.000 upfront and save $2,000. Great but not everyone wants to lay out that cash (and if they do, great, you just made $4,000!)
If they decline, you point them to the 3rd party finance program. The financier pays you $4,000, and the customer pays it back over the course of a year. You just gave the client the benefits of your monthly plan at the cost of your yearly discount and you made a lump sum.
This can also work with products, especially small time wholesaling. Do you distribute to re-sellers? Are they purchasing only 100 units at a time in cash? Put them on a finance plan, now they can make larger inventory purchases, you get more cash upfront, and they pay in monthly installments just as if they were paying previously month by month for product.
They can put a little bit upfront, receive and sell off their new inventory, and pay the loan back early with the money they made in sales.
The caveat to this is that the US resident must have fairly decent credit, but there are programs for lower scores too.
Here’s another way to use financing to help sell:
Let’s say you are a digital marketer. Lets say you are offering a Facebook ads program, you charge $1,000 and the customer provides $5,000 in ad spend. (My prices are examples I have no idea what to charge for that ha)
Become his financier!
Maybe he WANTS to run those ads but doesn't want to shell out a full $6k, but that ad spend is a fixed cost, you can't negotiate it. You sense his pain point and losing the sale is a possibility.
Point him toward your finance plan, he can get the entire $6,000, you're going to offer to finance his ad spend!
Tell me you wouldn't make more sales in that scenario.
Maybe I’m wrong, but people buy more when they can pay less over time.
The only key to this plan is you must sell it.
I hope this helps some people, it requires hustle and active selling to the client, but then again all business does in some way.
If you can sell your service, no doubt you can sell it for cheaper with a finance plan in place too.