“Staying a Step Ahead: Offering Financing Options”
No matter what business or industry your business is in, your ability to succeed often relies on the success of others. When the economy falls and people don’t have money in their pockets, they won’t be able to continue buying many of the luxury items that they would have, had they had their job. One way to try and combat the volatility that comes with the uncertainty of others is to offer financing from your company. I’m a dentist in Colorado Springs, and this has really helped me gain a competitive advantage. Financing may seem like a risk to some business owners, but in the long run it can help generate more sales and make people feel easier with buying your product or service.
One example of financing, that many people may not realize is financing, is when they buy a gym membership. When buying a gym membership, you are certainly given the option to pay for your one or two years up front, but it will cost you much more. So what’s the alternative? You can instead pay monthly for your membership, which in the long run will be much more than what you would’ve paid had you just done it all up front. So why do people do financing? Simply enough, people often want things that they don’t have the cash on hand to get. That is why financing for your company can be such a vital tool to bring in new customers.
Another key example is with the dental industry. Dental procedures, whether it is braces, bridges, cavities or any other necessary work, can be expensive. However, unlike a gym membership, dental work is something that is often required right away and people cannot avoid having done. But if they do not have the money readily available to pay for services, then it can make it difficult, if not completely impossible, to get the work done. However, dental offices that offer financing are now offering the opportunity for customers to get the work they need done, while being able to pay for it over a period of time.
Once you realize and decide that financing is a good way to go for your business, it’s time to start looking at how you can begin offering it to customers. The best way to do this is to go to a third-party company who offers financing, which will take a lot of the burden off of you. It helps to look for a financing company that is familiar with, or has a track record in, the industry that your business is. With the dental business example again, there are plenty of companies out there who look to finance dentist offices, simply because they know that financing is very popular to their customers. Working with a financing company that is already familiar with the industry will help you avoid headaches in the future.
After you have compiled a few different companies to consider, start calling them to get more specifics as to what they offer. Consider the information that they tell you and listen as if you were a customer of your business, rather than theirs. This will help you get a better idea of what people are more likely to accept as financing once they come to your office and need to consider that type of payment option. Once you have decided on a financing company, it’s time to start offering the option to customers to generate more business.
Keep in mind that financing is also a great way to take the burden off of you of managing some financials. Some companies who attempt to do in-house financing will come across the issue of customers who don’t pay back their initial obligation. If this happens just a few times, then businesses can be looking out on a serious loss of profits, which could be detrimental to the success of their business. Instead, by going with a third-party, the risk is off of you and instead it is something they manage and deal with. The reason they take that risk is because they have the manpower and experience of how to deal with it. As for you, stick with what you know and stay in your industry.
When it comes to whether or not you should offer financing, remember that it’ll probably benefit you. The bottom line is that the more payment options people have, the more likely it is that they’ll pay for the service. Don’t miss out on a sale because the customer can’t afford it, but rather given them options to pay for it instead.
About the Author:
Dr. Gary Mooreis the owner and dentist ofStetson Hills Dental. Besides general dentistry, Dr. Moore is also a greatcosmetic dentist in Colorado Springs. Outside of work at Stetson Hills Dental, Dr. Moore likes to hunt, fish and spend time with his family.