Why Financing is Essential for Your Sales Strategy

Offering financing options can give your sales team a boost. Your customers can get the important business assets they need without straining their budgets, which will accelerate your sales and make them happier. If you need a quick refresher on equipment financing, check out What is Lease Financing? Otherwise, keep reading to learn how financing can benefit both your sales team and your customers.  

Benefits for Your Salespeople 

Financing options allow your sales team to turn a “maybe” into a “yes” without the need for immediate funds. With a flexible payment plan, you can reduce the hesitation your customers may feel due to budget constraints. Here’s some key benefits to take into consideration regarding your sales team: 

 Beat Cost Objections and Boost Confidence 

When your customers are presented with a lower monthly payment instead of a large upfront sum, the investment feels more manageable. Breaking down the cost helps them focus on the value that they’ll receive over time rather than the immediate expense, which can reduce their initial resistance to your sales rep’s offer and make the decision to buy feel more comfortable. Your sales team can show your customers that they understand their financial situation and are willing to work with them. 

For the sales rep, knowing they have flexible payment options to offer can boost their confidence during sales conversations. They have a powerful tool to address one of the most common objections – cost. That confidence can translate into a more persuasive and effective sales pitch, resulting in a higher closing ratio. 

Accelerate Sales Cycles 

Shorter sales cycles lead to better performance metrics, like reduced average deal closing time and higher conversion rates, which are key indicators of success for your team. Your sales reps can also handle a higher volume of sales with quicker deal closures, helping them meet or even exceed their targets more consistently. A sense of momentum and success will drive your team to perform better and offering financing options can lead to more recognition and rewards for your team. 

When financing options are available, the buying process becomes much simpler too. Your sales reps will spend less time explaining complex payment structures and more time closing deals. Not to mention, financing options take away the need for prolonged negotiations over price. Customers are more likely to accept the terms when they see a payment plan that fits their budget. 

Your sales team can benefit from prepared responses to different objections. Check out this HubSpot article for some recommended specific responses to price objections. 

Setup the Upgrade 

Upgrades often come with a hefty price tag, which can be a big hurdle for customers. Your reps can make these upgrades more accessible by breaking down the cost into monthly payments. Customers are far more likely to agree to an upgrade when they see the cost can be spread out over time, fitting neatly into their operating budget.  

For many businesses, operating budgets are tight, and they prefer predictable, manageable expenses. Monthly payments align perfectly with this need. For your sales reps, this means increased sales opportunities and repeat business.  

Need to see how it works in practice? Here’s a success story from two technology resellers who created a win for their customers through an upgrade program. 

Benefits for Your Customers 

Your customers may be facing the challenge of needing new equipment or technology but being held back by budget constraints. They want to stay competitive and efficient, but the upfront costs are daunting. This is where financing can make a significant difference. By offering flexible payment plans, you enable your customers to get the essential assets they need without financial strain. Here are why your customers benefit: 

Protect Cash Flow 

Financing can be a lifeline for businesses that need to maintain their cash flow while still acquiring their essential assets. For your customers, having flexibility in this area can ensure that their operations still run smoothly, and they can focus on business growth rather than worrying about a significant financial expense. You can help your customers plan their budgets better with financing options. 

Another major benefit of financing is that it can cover not just the cost of the business asset itself, but also the associated soft costs. These include expenses like freight, installation, setup, training, and service contracts. When these costs are bundled into the monthly payment, it simplifies the purchasing process for your customers. Your customers don’t have to worry about multiple payments or unexpected expenses popping up later.  

Guard Against Inflation 

Your customers can lock in the cost of business assets at today’s prices, even as they pay for them with tomorrow’s dollars. This is very beneficial in an inflationary environment where prices are likely to rise over time. Securing a fixed payment plan for your customers means they can protect themselves from future price increases, keeping their costs predictable and manageable.  

Fixed payments can also help customers make more strategic financial decisions. Paying for assets at today’s prices is particularly advantageous for long-term investments, where the cost savings over time can be substantial. It also means that the value of the money they spend today is maximized, as they’re getting more for their dollar. 

Offering financing with fixed payments shows that you understand the challenges of managing a business in an unpredictable economic climate and are providing solutions that help them navigate those challenges. It's important to build trust and strengthen your relationship with your customers in this regard, as they see you as a reliable resource in their financial well-being. 

Provide Manageable Budgets 

You open a door to a wider audience by providing financing. Think about all the customers who might love your product but can’t afford the full price right away. With financing, your sales team can tell them, “We want to help you get what you need today without the financial strain.”  

You also increase the likelihood of repeat business through more affordable financing. Customers who have a positive experience with your financing options are more likely to return for future purchases, knowing they can count on you to provide flexible solutions. 

Maximize Capital 

At this point, you probably understand that when customers don’t need to make a down payment, it significantly helps them manage their cash flow better. Your customers can keep more money on hand for everyday operations and unexpected expenses, which can be a relief for any business owner.  

When customers keep their credit lines open and avoid maxing them out, it can have a positive impact on their credit score. This improved credit utilization could be the turning point your customer needs when it comes to future financing, helping them secure better terms on loans and other financial products. 

If you want to read more on how financing can benefit your business as a leader, check out our previous blog here.