How Vendor Finance Benefits Manufacturing Equipment Suppliers
Offering finance benefits equipment suppliers and their clients alike
According to the 215th ACCI-Westpac Survey of Industrial Trends June quarter 2015 the mood in the Manufacturing industry is improving. With the uplift in business confidence, many manufacturing companies will be looking to purchase new equipment.
Equipment suppliers can capitalise on this opportunity by partnering with an experienced finance provider like Classic Funding Group. Providing a suite of finance options to your clients through a Vendor Finance Program can deliver many benefits both to your business and theirs.
A common sales scenario…
Your team has done a great job of generating a lead, nurturing the contact and executing the sales pitch to create a desire for your product. Your sales rep puts together a proposal with the quote and… nothing. Your hot lead goes cold.
You’re confident that your product is best in market and can deliver the benefits that your client seeks, be it increased productivity, reduced waste or increased safety. So why has the lead gone cold?
You need to ask yourself three questions:
- Did the client have the cash to purchase the equipment?
- If not, did their bank make it too difficult to arrange finance?
- Did your competitor offer them a solution for purchasing their equipment?
Make It Easy
Many equipment vendors believe that clients will arrange their own finance if they require it. However, when a client has to arrange their own finance, not only is your deal in the hands of someone that has no vested interest in your sale, it also creates extra work for your client, who may get distracted by their day to day business and put it in the ‘too hard’ basket.
By offering finance you are making the process easier for your customer whilst controlling the entire sales cycle - from beginning to end.
Presenting the equipment cost in terms of monthly repayments assists with communicating your ‘value proposition’, protecting your margins and alleviating your client’s cash flow pressures.
It also prevents your competitors, who already offer finance, from swooping in on your deal.
Better Service, Better Client Retention
To ensure equipment operates at its optimal capacity it needs regular servicing and maintenance. Many companies that purchase equipment, however, do not service these machines as frequently as required. This often leads to the equipment underperforming or breaking down, causing downtime and bad customer experience.
By combining the equipment finance solution with the service and maintenance plan into a single monthly repayment, you are providing a simple “total cost of ownership” solution to your client. This ensures that your client has a primed machine and a positive brand experience. It also means that you have continuity of contact with your client, so when your client needs more equipment, you will be the first to know, ahead of your competitors.