Once you’ve finally gotten a prospect or existing customer ready to make a technology upgrade, you’ve likely had a few conversations about their current environment and have provided recommendations for the upgrades they need within their current IT infrastructure.
We understand you may feel like you’re walking on thin ice not wanting to make a wrong move. You want the deal to keep moving forward as seamlessly as possible. In the back of your mind, you may wonder how they will react to the total cost of the upgrade and if it’s something they have the budget for this year.
While we can’t promise this article will lead you to a close, we can tell you this: we’ve had customers tell us they were able to win a deal from a competitor because they offered a technology finance option – their client was able to upgrade their technology sooner because a finance option was presented.
In fact, customers have come to expect financing. A survey of technology buyers revealed 68% prefer to work with a vendor that provides a total solution including financing.
If you want to shorten your sales cycle, decrease DSO, and make it easier for your customers to say YES – keep reading for best practices that will enable you to do just that.
Best Practice #1: Bring up Financing Early and Often
Don’t wait to mention financing until you’re at the time of the proposal. Make sure your prospect or client is aware upfront that financing is an option. This is important for a major reason, demonstrated by an example one of our sales representatives recently experienced:
She was looking to purchase a stationary bike and took to Google to look through different options. Most sites only listed a total cash price, and she had thrown the reality of purchasing a bike out the door, as she couldn’t justify the cost. That was until she came upon a site that offered not only cash but also a monthly payment option. Now that a payment option was on the table, she started to think through her monthly budget. The monthly cost of the bike was like what she was currently paying for a gym membership. Quickly she realized through a monthly payment that owning a stationary bike was realistic.
Differentiate from competition. For a long time in the IT space, offering financing was a differentiator from competitors. At this point, presenting financing may be what is needed to level the playing field. Your competitor may be offering a monthly payment, and you don’t want that to be the reason you lose a sale.
Long story short – make sure your clients know it’s an option by bringing up financing early and often in your sales process.
Best Practice #2: Utilize Strategic Questioning to Position Financing
As your clients’ trusted technology advisor, you likely facilitate strategic conversations with them to learn more about their business and growth goals so your team can best align technology solutions that supplement their initiatives.
That said, when positioning a finance option in your conversations, there’s no fancy lingo or talk tracks you need to learn. You can continue facilitating similar discussions and tee up the finance option.
The next time you want to bring up the finance conversation with your clients, skip the questions “How do you plan to pay for this?” and “Do you want to lease or pay cash?” These are straight, to-the-point questions, but do not necessarily position you as their trusted technology advisor.
Instead, consider using a few of these impactful, needs-based questions that will differentiate you from the competition:
What are your growth expectations over the next three to five years?
If your customer is looking to grow, you can provide finance recommendations that will grow with their plans. Financing will allow them to conserve cash and utilize it in areas that supplement growth, such as hiring employees or advertising.
Optional talk track: “In our previous conversations you outlined your growth initiatives and the areas you plan to invest in, like advertising and hiring employees, to meet those growth goals. That said, we’ve added a finance option to your quote as we know it’s important to preserve cash for areas of growth.”
How important is cash or working capital to your business? Why?
Confirming how important cash or working capital is to the business is a crucial step in the sales process. If you already established it is important to them to have working capital, you can say, “I understand working capital is important to your business, which is why we’ve added a finance option to your quote. Financing will allow you to preserve your cash and keep your technology up-to-date.”
What are your greatest concerns for making this decision?
You need to understand the customer’s mindset going into the transaction. This final question will help you overcome objections before the concerns become objections. If one of their concerns is cost, you can emphasize how the financing will allow them to conserve their cash/bank lines and allow them to get up-to-date with the technology they need today instead of waiting until a system is down.
Best Practice #3: Don’t Overwhelm Clients with Too Many Options
Have you ever sat down at a restaurant, opened a menu and were paralyzed with too many choices? It’s great having options, but too many of them can overcomplicate the sale. With financing, here’s a rule of thumb: if you are quoting financing, stick to one or two options. Select the options you recommend and talk through the options and why you selected them.
For example, you may present your client with a 36-month, Fair Market Value (FMV) option. When presenting this option, state you are presenting a 36-month agreement because 36 months align with the usable life of the technology and the length of the equipment’s warranty. You can also explain you’re presenting FMV as it provides them flexibility at the end of the agreement to either return the equipment, buy the equipment, or upgrade to new gear.
Best Practice #4: Educate Clients on their Purchase Decisions
Educating your clients on their purchase avenues will not only position you as their trusted advisor, but it may also help shorten the sales process as it allows your clients to easily navigate the best route to acquire their new technology.
Your clients will likely need to decide between these three options when purchasing technology; lease, bank loan, or cash.
More Sales Tools for Financing Success
In tandem with utilizing the best practices highlighted in this article, I encourage you to download the GreatAmerica Sales Enablement Toolkit, where you’ll have access to:
- The benefits of financing
- A comparison between a lease, loan, and bank purchase
- 12 questions to differentiate your sale
- Talk tracks and objection handling tips
GreatAmerica is the largest, family-owned national commercial equipment finance company in the United States. A $3+ billion company with life-to-date finance originations of $16.1 billion, GreatAmerica was established in Cedar Rapids, Iowa in 1992. Dedicated to helping manufacturers, distributors, resellers, and franchisees be more successful and keep their customers for a lifetime, GreatAmerica offers innovative, complementary services in addition to financing. GreatAmerica is committed to the communities it serves and donates more than $1.1 million annually through a GreatAmerica Donor Advised Fund and an Employee Advised Fund, giving team members a say in where funds are allocated. www.greatamerica.com
