3 Big Reasons Dealers Need to Offer Leasing to their Customers
Leasing comes in handy for equipment dealers looking to sell more equipment. Buyer’s love having the option to break equipment costs into smaller and more manageable payments.
Of course, as a dealer you aren’t in the business of lending. You might think that providing financing to your customers will mean mountains of paperwork, payment delays, a steep learning curve, and legal ramifications. All of this couldn’t be further from the truth when you partner with an equipment leasing company like Thomcat Leasing. That’s because your financing partner will take care of all that for you.
Here are the 3 big reasons you need to offer leasing to your customers:
1. Leasing takes the attention off the price tag
Take your buyers focus off of the price tag by offering an easy to understand monthly payment. Even the most seasoned buyers get sticker shock sometimes. That’s because a buyer is thinking about their business cash flow in a monthly or seasonal way. Conceptually, it’s easier to understand a number that fits into their regular cash flow.
Let’s look at an example: Say your customer wants to buy a $40,000 mini excavator. Which do you think makes more sense to them?
Statement #1: “The mini excavator costs $40,000.”
Statement #2: “The mini excavator costs $800 a month over 5 years.”
$40,000 sounds like a lot of money – especially when you have to pay it all up front. Whereas, $800 is a very manageable expense for nearly any business owner who will be earning income off of that mini excavator!
These days, everyone is running their businesses on thin margins. Which means most of the cash-flow available is tied up in day-to-day operations. As such, they probably can’t buy equipment with cash. Leasing overcomes this by tying the equipment costs into their day-to-day cash flow.
2. Retain your customers longer
Happy customers come back (and send their friends to you). It’s that simple.
Your job as a dealer is to make the purchase experience so positive, that you are the customers first thought the next time they need to purchase again or upgrade.
How does leasing help with this? Well, you will save your customers countless hours searching for a 3rd party lender to start. The question of how your customer will pay for the equipment is already dealt with for the most part. Instead, you can use the time to really focus on what the customer needs.
Additionally, some lessors will let you know when a customer of yours is nearing the end of their lease. That’s the perfect time to reach out and see if they’re ready to upgrade.
3. Leasing gives you flexibility
Without leasing you only have 1 payment option to offer your customer: lump sum. Chances are good, if they can’t afford that, you will suggest they talk to their bank about securing a loan. Weeks, possibly months later, the bank has finally approved them.
Yes, mistakes were made.
With leasing, you don’t need to send people away. You can easily offer on-the-spot financing with plenty of options.
Does your customer earn most of their living during the summer and fall? No problem, leasing allows for seasonal payments. Does your customer want to pay off the lease quickly? No problem, terms as short as 2 years are available. Does your customer want a lower payment? No problem, you can add residual and/or go for a longer term.
Well, you get the point. Leasing offers a lot of flexibility.
Let’s not forget to mention that leasing takes only minutes, sometimes a bit more, to approve your customers. Paperwork is minimal because the loan is secured to the purchased equipment.
Take Control of Your Sales with Leasing
Start selling your customers equipment and addons based on what they need, not on what they think they can afford. It’s much easier to handle price objections when you can break the costs into small affordable payments. Your customers will appreciate how easy it is to work with you, and they’ll come back. Leasing covers all the costs including taxes, documentation, shipping, and inspections.
You’ll get 100% paid on the day of the purchase too.
Thomcat Leasing has dedicated staff to support dealers just like you. Start offering lease financing to your customers today!