How do you offer a Payment Plan to Customers?

How do you offer a Payment Plan to Customers

Are you thinking of offering payment plans to your customers? Here’s a step-by-step guide to getting you there.

Wondering how to Offer Payment Plans to Your Customers?

Not every business offers payment plans. Those that do experience significant benefits. Some customers prefer flexible payment plans over cash purchases. Businesses benefit by building loyalty and strengthening customer relationships. Offering flexible payment plans increases revenue and helps businesses grow. In this article, we’ll go over the ins and out of what a customer payment plans are, and how exactly you could start offering them to your clients.

So Why Should a Business Owner Offer Payment Plans to your Customers?

With the help of payment plans, customers can pay back their debts without having to worry about being charged penalties or interest. This allows them to save money by paying off their debts sooner than they otherwise would.

Nowadays, there are many third-party providers that offer this entire setup. Not only that but these payment plan companies take on all the risk because they will pay you upfront while accepting payments from your customers.

Benefits of Using a Payment Plan for Your Services

#1 – You build Stronger Customer Relationships and Loyalty

Think about this for a second, if you offer more flexibility to your customers when it comes to payments, you’re more likely to bring in more customers, no? Having more flexibility isn’t going to scare people off. By offering such payment plans, you give them more reason to work with you.

You start reducing the fear someone might have around the costs of your services. This can build a stronger trust in your business overall.

If you give your potential customers more purchasing power, you will ultimately help improve customer satisfaction right out of the gate. If you can deliver on your product or service, you will have a lifelong raving fan.

#2 – You’re likely to bring in more Revenue

With a higher level of payment flexibility offered, your customers will likely spend more with you. Think about this for a second. Let’s say you offer a service at $500, and another is $700. That could be a $1200 upfront cost which could scare off potential prospects, especially if your service is a “nice to have” type of offer, vs an absolute need, like a brand new roof because your old one blew off in a Storm!

If they now have the chance to pay that over say 6-months, that then becomes a manageable $200 fee at a time.

Without a payment option, that customer may have only wanted to start with say the $500 offer, so you’ve potentially limited your “upsell” potential.

#3 – Makes Big-Ticket Items not look so big

If you’re selling expensive items, there is always a chance you will scare off potential buyers. Being able to offer payment terms helps reduce the stress around large purchases.

You can offer payment plans to your customers. It’s a matter of planning and preparation.

In order to effectively offer payment plans to your customers, you must be prepared and able to manage the process. This involves planning ahead, knowing how much money your business needs, and calculating how many installments this would entail.

It also means being able to offer a variety of payment methods and having the ability to monitor progress on payments as well as maintain customer records.

In addition, it’s important to keep in mind that there are certain laws regarding payment plans for certain industries (for example, healthcare).

First, Fine-Tune Your Payment Options

Regardless of how your business operates, offering a payment plan is an important part of customer service. Not only will you be able to help more people afford your product or service, but it’ll also improve your relationships with customers.

You can offer payment plans to new and existing customers alike—but the process will differ depending on their status. For example, if you’re looking to get paid by a client who isn’t currently working with you yet (e.g., an artist who’s just submitted a proposal), then the steps involved in setting up this agreement would be different than those involved in setting up a payment plan with someone who already has an account set up with your company (like if they come into the shop regularly).

For example: do not offer credit cards as an option unless this has been approved by whoever handles finances within your company—most likely upper management! It can also help if you know what kind of procedures are required by law when determining whether or not someone qualifies for financing through terms like “no credit check.”

Second, Plan Your Team and Sales Approach

If you are going to offer a payment plan, it’s important that your employees know how to sell them. Make sure they understand the benefits of offering payment plans and have a clear idea of what the options are. It’s also important that they have all the information required to help customers get started on their plan right away.

Third, Monitor Progress

Take note of some important metrics as you progress using these methods. You may want to look at the average sales transaction size over time vs. regular business transactions.

Who should I use for Flexible Payment Options?

While there are many choices out there, we highly recommend merchants like Cherry Payments as a third-party provider. They allow for flexible options and an installment payment plan that gives some peace of mind to both you, and your customers. Check out our blog “What are Cherry Payment Plans” to learn more!

Customer Financing with Ease

We wish you luck in your journey of offering payment plans! We hope that these tips can serve as a guide on how to do this the right way for your business so that everyone wins. We know it’s been a big topic of discussion lately, and we’re glad to have shared our thoughts on this issue with you. Good luck out there!

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