No matter the industry, chances are that your business has been critically affected by the pandemic. Lockdowns, a struggling economy, and social distancing mandates have forced a shift in business-customer interactions. Though officials are confident we are nearing the end of this crisis, the question still stands: what will 2021 bring, and how can businesses best prepare themselves for success?
We’ve put together information on how your business can use customer payment plans to have a successful 2021.
Before We Jump In, Let’s Review What We’ve Learned This Year.
The business world has changed significantly since March. In order to effectively craft a plan for 2021, we must first ask ourselves: what have we learned?
For starters, we know that customers are worried. Shared surfaces, cluttered waiting for lines, and dirty cash has all become immediate off puts in 2020 that can easily influence a potential customer to take their business elsewhere. Customers have also changed their spending habits: with many struggling for payment plans, a change in spending habits may realistically mean no spending at all.
Knowing how your customers’ spending habits have changed through the pandemic will be fundamental in developing your business plan for the coming year. With many people struggling with payment plans, customer payments will be a key tool for your business to use in order to continue growing.
Why Customer Payment Plans Is Your Ticket To A Healthy 2021
Offering customer payment plans benefits businesses as much as it benefits customers: payment plans make it possible for businesses to attract new customers, increase their sales, combat seasonal slumps, and much more. For many businesses, offering customer payment plans in the coming year can mean the difference between a conversion or an abandoned sale.
Attracts New Customers
Having payment plans options increases your business’s chance of gaining new customers who otherwise would not be able to afford your services. Payment plans break down large purchases into manageable payments that are more affordable. For many, a payment plan spread across multiple months is an easier investment to commit to rather than a single big-ticket purchase. By offering payment plans, your business creates value for your customers by helping them save money, which can encourage repeat business and friend referrals.
Attracting new customers won’t help your business grow if those customers aren’t spending. Studies have shown that businesses that offer customer payment plan programs at point-of-sale have increased their sales by 32 percent. With additional sales, your business is better prepared for growth, or even unexpected slowdowns.
Increases Average Purchase Value
Payment plans offer your business an opportunity to effectively upsell its customers, which in turn increases your business’s average purchase value. By showing your customers that an upgrade would only result in a slight increase in their monthly payments, your business is better positioned to offer premium services at affordable prices without potentially scaring away customers with a high price tag.
Better Relationships With Customers
Customer payment plans encourage your business to build better relationships with your customer base. With payments spread across multiple months, your business has the opportunity to build rapport and trust with each customer by understanding their payment plans situations. Building stronger relationships with your customers also create brand loyalty, which is fundamental to improving customer retention.
Combats Seasonal Slumps
If your business experiences periods of slowdowns during the year, then you’re already well familiar with seasonal slumps. However, your business doesn’t have to accept that as reality. By offering payment plans to your customers, your business keeps the momentum up during slowdown periods through your customer’s monthly payments. A continuous cash flow softens the impact many businesses face when slowdowns occur and keeps you on track for when business picks back up.
How To Effectively Offer Customer Payment Plans
There are two routes your business can take to begin offering customer payment plans: in-house payment plans or partnering with third-party lenders.
In-house financing can be a convenient way to keep everything within the business. However, most businesses don’t have the resources to effectively do so. This option requires a large portion of your business’s time and comes with a multitude of legal responsibilities that are associated with the use of customer credit information.
Traditional lenders remove some of the hassles of customer payment plans by providing the funding required to payment plans a customer and handling payment collection. This option saves your business time by outsourcing the payment plans process to an established lender. However, exclusively using traditional lenders may hinder your ability to grow.
Traditional lenders tend to qualify less than half of the total applicants. 50 percent qualification means 50 percent less revenue for your business. When using these lenders, there are various hidden fees that can result in your business not receiving 100% of the total payment plans amount back, costing your business important revenue. Traditional lenders also rely heavily on credit scores, which suppress the most vulnerable, especially during a pandemic.
You can avoid the problems of in-house payment plans and pitfalls of only using traditional lenders by incorporating services such as Denefits into your business.
Denefits: Complete Payment Options
Denefits is an innovative complete payment options system that provides businesses with easy payment solutions and payment plans options for their customers. Think of Denefits as in-house payment plans, without any of the hassles of in-house payment plans!
With no credit checks, a 100 percent approval rate, and guaranteed payments, Denefits helps businesses solve the problems associated with payment plans and helps bring on customers they couldn’t take on before, turning missed opportunities into additional revenue.
Getting started with Denefits is a quick and easy process: there are no service fees nor is there any equipment to install, so your business can begin payment plans for its next customer after only a few simple clicks.
Going Forward: What This Means For You
Offering customer payment plans in the coming year will be a sure way of helping your business stay strong during times of uncertainty by helping you maintain a steady cash flow while also increasing your customer base. No matter the route your business takes in providing customer payment plans, services such as Denefits can help simplify the process.