Listers’ MD Roy Frost explains the advantages of offering finance deals.
Reading this month’s Business Pilot Barometer one thing has really struck me: that homeowners have regained their confidence, and are investing in their properties as a result.
The most significant statistic for me is that leads were 20% higher in June 2023 than they were in June 2022, which is when inflation started to take hold.
Also, house prices aren’t dropping as significantly as people were predicting, and – probably thanks to the increasing interest rates – there is not much movement in terms of sales.
So, are we looking at an ‘improve not move’ scenario, where homeowners are investing in their existing properties rather than looking elsewhere? The conversion rates picked out by Business Pilot seem to support this: at 42.5%, it looks like homeowners are doing their research before looking at just two (sometimes three) window companies to carry out the work.
I’ve discussed before about the importance of improving your marketing, and offering a product range that will meet the needs modern home improvement – traditional aesthetics, energy efficiency, security and sustainability – but there is another string that you could add to your bow: finance.
Offering a finance deal to your customers can offer significant benefits, and it can be done without adding any risk.
“Offering a finance deal to your customers can offer significant benefits, and it can be done without adding any risk”
Primarily, if homeowners come to you with a potential order, then they have already decided that they can afford it, even if they don’t have the money up front. By offering a finance option, you are giving them a route into that sale where they may have hit a brick wall elsewhere.
This, in turn, allows you to differentiate yourself from competitors who don’t offer similar financing arrangements. Also, customers who see you as accommodating and supportive of their financial needs, may be more inclined to choose you over others.
You can also build a long-term relationship with customers through financing, and you may find that you can get repeat business off the back of it. These satisfied customers are also more likely to recommend you to friends and family.
If homeowners are using finance, they may not feel so restricted in terms of budget, and increase their order value as a result. For them, the focus would be on the monthly payment, not the overall value, which will drive profit margins for you.
Offering finance through an established financial institution could enhance your credibility as a retail brand, even if your customers decide not to go down the finance route themselves. They may feel more secure buying from you simply by knowing that a reputable financial institution is involved.
And, of course, offering finance deals can benefit your cash flow. Upon a successful sale, you will receive the full purchase amount upfront, while the customer pays off the loan over time. This allows you to invest money back into the business and build in an element of security in your operations.
We have partnered with Kanda to offer a simple, hassle-free finance service for your business. Once enrolled, you can be offering your customers finance deals within five days, who will learn within 30 seconds if they are approved, and the full application only takes five minutes to complete.
Via Kanda, you can offer your customers a range of products, including ‘buy now pay later’ (which will cost window companies just 4.25% of the order value). You can also choose the size of the deposit, which is typically anywhere between 10% and 50% of the total order value.
We searched long and hard to find the right finance partner. Kanda is simple to use and has an excellent reputation. Also, the more window companies that sign up to the scheme, the better the discounted rate will be.