Vendor finance (or seller finance) is a smart tool to help you close a deal. And it offers some great advantages over 100% cash upfront transactions – for you and your clients.
You can offer clients financing on almost any business equipment or car purchase through CAAA.
4 big benefits of vendor financing
- Avoid heavy discounting: By offering an attractive financing plan you don’t have to rely on discounts to make a sale. In fact, many vendor financers sell “add-ons” with the product and increase sales volume.
- Protect and boost sales margins: Agreed payments over a set period mean you will often increase your bottom line profit on the equipment, car or product.
- Close more sales: When you have the option to tell customers that they can pay, say $600 a month over 5 years rather than $33,000 today it gives you a real advantage over your competition.
- Become more valuable: By offering vendor finance you don’t just solve your client’s equipment, product and vehicle problems, but their payment concerns too. You become a one-stop total solution.
How a cash sale vs monthly payment looks
To explain how vendor finance can make your business more appealing to clients, let’s take a look at a simple scenario:
- Company A only accepts upfront payment of $33,000.
- Company B offers vendor financing, giving their client the option to use the equipment for only $140 per week and then own it after 5 years.
Who can you offer our vendor financing to?
There are four requirements. You can offer CAAA financing to businesses that:
- Have been operating for 2 years or more
- Own property
- Have a good credit history
- Are profitable