Offering in-house equipment financing to your customers is an excellent way of boosting customer loyalty and building a repeat clientele. One study by PayPal shows that customers who benefit from better and improved financing from a given equipment financial provider usually buy 15% more the next time they make a purchase from the same provider. As if that’s not enough, more than 90% of customers who use consumer credit always use it again. In the absence of financing, however, more than 60% of web browsers who are not able to qualify for a conventional credit card will be forced to walk out the door without making a purchase.
So, how can you offer the best equipment financing to your customers?
1. Provide flexible financial solutions
The type of equipment financing solutions you provide should be flexible. These solutions, especially leases, should be tailored to specific accounting, tax, or cash flow needs. This flexibility makes it easy for customers to repay.
2. Offer capital preservation
Capital preservation is a service only offered by a handful of equipment finance providers so it’s something that will easily set you apart. Large capital investments often represent a major risk, especially for small businesses. What if the capital asset doesn’t yield the desired gains? You can mitigate such uncertainty among your customers by matching lease payments with the productivity of the equipment.
3. Consider business cycle flexibility
Flexibility is critical in equipment financing. Customers will prefer a lease type that allows for seasonal fluctuations. They may also favor financing options that allow them to make lower monthly payments while the project is ramping up until significant revenue is being generated from the equipment. So, your financing structure must cover for these needs.
4. Be an equipment expert
Although you might just be offering equipment financing services, expert knowledge in various equipment specialties can be a major bonus. Equipment financing experts maintain special relationships with manufacturers and distributors and use this knowledge to customize their financing services better depending on the customer’s needs. Again, most equipment finance companies don’t provide such services so you’ll be able to stand tall among the crowd.
5. Provide managed-obsolesce services
The risk of owning obsolete equipment is one that terrifies everyone. So, a financing company that helps with easy and fast equipment updates will usually be preferred. In partnership with your vendors, find ways to help these customers “right-size” their equipment by structuring co-terminus transactions. You can also consider trade-ins to make sure that the customer has up-to-date equipment.
6. Offer asset management services
Equipment financing companies can also increase customer loyalty by offering asset management services. In asset management, you help your customers ensure that equipment under production isn’t under-utilized or over-utilized. This can be achieved by helping them know where the equipment is being used and how much it’s being used. When it’s time for upgrading, you can also remind the customers about it.
7. Help with disposal
Lastly, great equipment finance companies also help with product disposal. Most businesses lack the knowledge or resources to sell their old equipment. If you can help with this, they’ll be forever grateful.
There are several other things you can do to woo over more customers. These seven are just a starting point.