| Equipment vendors who offer a properly structured | | | | attractive to buy from you. If a vendor uses multiple |
| leasing program are not only giving the customer a | | | | companies and shops deals, they will not usually get |
| viable financing option, they are taking a major step | | | | the best rates.o Using one leasing company results in |
| to increase sales, market share, and profits. Yet it's | | | | better pricing because of increased volume. Leasing |
| surprising how many companies will not provide a | | | | companies make more money when deals come |
| leasing program. Some say it's because their | | | | through referrals, rather than expensive marketing. |
| customers have their own sources. Others say their | | | | The referral business is more profitable because it |
| customers pay cash. This mindset can be costly in a | | | | provides a steady stream of deals from clients who |
| variety of ways. The biggest problem is that it can | | | | are looking to acquire equipment now and need |
| drive the customer to the arms of your competition. | | | | financing.o Because maintaining the relationship with |
| Some equipment suppliers do offer a leasing program, | | | | the equipment supplier is critical to profitability, they |
| but give the customer a choice between several | | | | will do everything in their power to keep the approval |
| leasing companies for them to use. That may sound | | | | rate high and the lease rates low. These savings are |
| practical, but "shopping" deals with a multitude of | | | | passed on to the client.o The leasing company will |
| leasing companies can actually lower the chance of | | | | also be more motivated and go the extra mile to |
| approval. If the customer chooses one of the leasing | | | | fund the most challenging credits.o Because of |
| companies, and is subsequently declined, two | | | | economies of scale involved with large volume |
| negative actions may result. First, the credit inquiry | | | | directed to the leasing company, the supplier is often |
| lowers the customer's credit score. Second, it will be | | | | entitled to referral fees of 1% to 2%, thus providing |
| clear this is a shopped transaction, and will make it | | | | an additional income stream. |
| more difficult to get the credit approved. If it is | | | | Providing a lease option to your customers has |
| approved, the lower credit score will cause the rate | | | | tremendous advantages to everyone involved. Both |
| to be higher. | | | | the leasing company and equipment supplier will likely |
| Establishing a sound relationship with one reputable | | | | enjoy increased profits and the customer can acquire |
| leasing company is the best course of action for both | | | | much needed equipment without a large down |
| your company and your customers for several | | | | payment. Another advantage to the customer is that |
| reasons:o The relationship (allowing one leasing | | | | leasing allows them to easily upgrade their equipment |
| company to be involved) should result in lower rates | | | | package to a state of the art level. |
| for your customers, thereby making it more | | | | |