Consumer Financing: When Is It Right for Your Business?
Businesses are continually looking for ways to improve their average order value, or AOV, as a means to stimulate sales and increase revenue. Statistics show that consumer credit products dramatically increase AOV and are often a significant factor in shoppers deciding to purchase rather than pass on. Here is some information on consumer financing to help you consider it as an option for your business.
Basics of Consumer Financing
Consumer financing products are similar to credit cards in that your customers receive products or services and make a series of payments to cover the costs. Typically shoppers answer a few questions for initial approval, and within a couple of days, the retailer receives the full sales price. It’s a simple and elegant solution for both business and customers.
Benefits of Consumer Financing
Using consumer financing increases the amount of customers who will consider purchasing products or services from your business. It is especially effective with large, expensive items and holiday bulk shopping. When shoppers have the option of consumer financing, they are more likely to make the decision to buy and also place larger orders. As the retailer, you receive the full payment upfront. Additionally, you have a chance to further entice consumers by promoting offers such as special low financing over specific periods of time. Not only large retailers, but also small businesses are able to take advantage of this enticing means of encouraging shoppers to convert their browsing into solid sales.
Selecting a Program
There are a number of things to keep in mind when selecting a credit-lending partner. Find out if the credit provider charges a monthly fee or only the usual fee per transaction. Be sure to select a lender program that is reasonable and favorable to your customers.
For more advice on consumer financing, get in touch with AMZA Capital.