Benefits of a Vendor Financing Program
How a Vendor Financing Program helps both the Vendor and their Customers.
Vendors and customers alike can benefit from a vendor financing option. Depending upon the vendor financing program, there are many benefits to offering financing to your customers.
Types of Vendors who can Benefit from having a Vendor Financing Partner
- Equipment companies. Any type of equipment, particularly large ticket items such as construction equipment, lab equipment, business cargo trucks, security equipment, etc.
- Subscription software such as ERP or CRM software. Any type of software can be financed over the term of the subscription turning a large upfront cost into monthly payments. In addition, training, implementation and hardware costs can be rolled into the financing as well.
- Industrial Automation Equipment Providers.
- Breweries, wineries and brewery equipment companies.
- Point of Sale companies.
- Almost any type of manufacturer.
Why Financing Can Help Customers
- Customers don’t need to find financing on their own. This can reduce the time it takes for a customer to make a purchasing decision. It can also induce a customer to purchase by spreading paying for the equipment or software over the lifetime of the asset.
- Soft costs, such as delivery and installation for equipment, and training and implementation for software, can also be included in the financing turning large upfront costs into monthly payment.
- The associated soft costs, particularly for software subscriptions such as ERP implementations, can be much more than the cost of the software itself. By being able to finance it along with the software, it makes it easier for the customer to be able to afford an ERP solution.
- Financing, especially for small and medium-sized enterprises, means that they can afford equipment to expand, or software for streamlining or organization because it reduces the impact on their cash flow. By having a fixed, monthly payment rather than a large upfront cost, a small business can afford equipment and software that they otherwise might have been able to purchase.
Why Financing Can Help Vendors
- Providing financing is expected by your customers. It can be a part of your overall marketing strategy.
- It speeds up the closing of the sale. Because customers don’t need to search for financing but can get it within a day or so of applying, vendors are more likely to close the sale.
- You are offering more than just a product. You are offering a service and a comprehensive approach to your customers. Vendors who offer a personalized, comprehensive service to their customers are more valued by customers and generate more sales.
Selecting the Right Financing Partner
It’s not just that the financing partner provides financing. A financing partner can be a true partner to a vendor and help to generate sales. A true partner with a comprehensive vendor financing program can help a vendor by:
- Providing co-branded flyers and print materials that explains financing options and the benefits of financing. These flyers can contain the vendors product information and financing options for their services.
- Setting up online applications and landing pages which gives the customer a quick and easy way to apply for financing, explains any promotions and helps with converting a prospect to a customer.
- Provides an app, a “Financing Widget,” that the vendor can install on their website that quickly and easily puts a financing application & a payment calculator on the vendor website. It also provides information on financing options which allows the customer to apply for financing even before they contact the vendor.
- Maintains good communications with the vendor and helps with responding to changes in the vendor’s landscape.
The pandemic significantly upended many companies’ landscapes. By having a vendor financing partner, companies were able to weather the changes, increase sales and improve relationships with their customers.
Having a vendor partner such as Dimension Funding, who is responsive and actively works with a vendor to help close sales, can positively impact the bottom line of the vendor, give a better experience for the customer and generally improve the purchasing experience.
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