Having been in the equipment leasing industry for several years, I can’t tell you how many times I’ve heard business owners, sales managers, and sales reps make the comment, “My clients don’t rent!” Then I will continue with the question, “How do you know?” The answer is usually something like “It never comes up” or “They never ask for it.”
Well, the truth of the matter is, the reason they don’t apply is simply because they don’t know there is a leasing option available, or they just don’t think about it. If you don’t ask, you don’t know …
Most companies rent something!
A copier, your premises, vehicles or some equipment where a monthly payment option was provided in the sale process. In fact, all kinds of organizations rent equipment. Small and large, public and private, for-profit and non-profit, governments and related organizations such as hospitals, school boards and municipalities. If that’s the case, there’s no reason why they wouldn’t consider leasing the equipment you’re selling.
You cannot assume that a potential customer does not rent or would not rent, given the opportunity to do so. No one has ever missed a sale by providing a lease payment, but you have to wonder how many sales have been lost by not making the monthly option available. It takes very little time and costs nothing to incorporate a monthly payment into a sales presentation or quote; however, doing so can have a substantial impact on sales.
Think about this …
If you only provide the customer with the full purchase price, your options are limited to buying or not buying the product. If they choose to buy, they must determine how they will pay for the equipment.
• Will it come out of cash flow, where it will immobilize working capital?
• Will your line of credit be withdrawn, which may require approval from your bank?
• Do you have to go to your bank to get a term loan or try to apply for a higher line of credit limit?
These are hidden objections that are rarely shared with a seller. By offering a lease option, you are solving these problems for the customer and, in effect, creating a new line of credit for them.
Additionally, a monthly payment is likely to be considered an operational expense and can often be approved at a lower level within the organization. On the other hand, a direct purchase is likely to be within the capital budget, which generally has a longer approval process.
By managing the financial aspect of the acquisition, you, as the seller, are controlling the sales process. How often have we left a quote in the hands of a client, thinking that the sale has been made, and then, for no apparent reason, they change their mind? Usually this has something to do with money.
Finally, once you have fully responded to all objections about your product, leasing can be an effective closing tool, providing you with powerful closing statuses.
For instance …
“Mr. Customer, based on the conversation, I believe our ABC widget will save you the time and money it is designed for. Do you agree? If the answer is no, ask more questions about the concerns with the product and handle the objections If yes, use a closing statement such as “Mr. Customer, that just leaves the question of your investment in the product. We discuss a purchase price of $ 23,167 or a monthly payment of $ 791 per month. Which one would you prefer? “On the other hand, if the client has committed to the lease option, a great closing question would be” Mr. Client, would you like us to prepare the documents within 3 years at $ 791 per month or do you prefer payment lower than $ 612 per month over a 4-year period?
In short, leasing is a tried and tested method of increasing sales. It is simple to implement and the results can be amazing. No matter what product you sell or what industry you are in, leasing will help your business grow.