Top 5 Ways to Maximize Sales with Payment Plans: Part 1

Nobody likes surprise costs, especially in the thousands. With 70% of customers using payment plans for their purchase and spending 110% more on average when they do, flexible payment solutions aren’t just nice—they’re often necessary.

Don’t let pricing stand in the way of helping your customers. Reduce sticker shock by equipping your team with smart strategies that turn cost concerns into confident commitments.

In this episode of Cracking the Code, Drew Camron explains how to be a financial resource and creative ways to subsidize costs to make it easier for customers to say yes. Learn how to boost customer satisfaction and increase profits at the same time!

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00:00:00:00 – 00:00:09:21

On today’s show, learn the top five ways to maximize sales with payment plan.

00:00:09:24 – 00:00:27:00

Now, as we all know, payment plans can be a great way to maximize your sales. Today we have Drew Cameron here to talk about the top five ways to do this. Take it away, drew. As we head in, this is spring and summer and the heart of our season where we get the busiest, in the Hvac industry.

00:00:27:09 – 00:00:47:10

Certainly. It’s not the only time we’re busy, but it’s the busiest, probably for most of us. As you know, it’s important to make due of the opportunities that we get, right? Everybody talks to me. My consulting and training business about adding more opportunities. And I don’t think that’s necessarily always the answer. We got to do a better job with the opportunities that we get.

00:00:47:13 – 00:01:09:13

I mean, we’ve got to convert them and payment options is one of the ways that you can maximize your sales and profits in doing so. So without further ado, let’s dive into the content and I’ll share with you my concept of the top five ways to maximize your sales and profits with payment plans. So Frank Becker was a friend of Dale Carnegie, who wrote a book called How to Win Friends and Influence People.

00:01:09:13 – 00:01:27:20

And, Dale Carnegie said, Frank, way back when, he said, you know, you’re a better salesperson, a better sales coach, car sales trainer than I ever was. He said, you should write a book. So he did. And the book was called how I Raised Myself From Failure to Success in Sales in 1937. And Frank said in the book is show people what they want most.

00:01:27:20 – 00:01:43:09

They will move heaven and earth to get it. And so we’ve probably heard you probably heard that phrase in some form or fashion over your career, but I’ve updated and basically said show people what they want most, why they shouldn’t be without it, how they can afford it, how they can pay for it, and they’ll buy from you.

00:01:43:12 – 00:01:59:25

Right? Because that’s the key is you got to be good at not only what you’re selling, what you have to offer, but also showing people how they can afford to get what you have to offer. Because I’m hoping it’s something different, better and more and at a premium price because you’re right, price. And so it also should be a different price.

00:01:59:25 – 00:02:19:09

It’s not that we’re 2 or 3 or $4,000 more than somebody else. We should be probably 2 or 3 or $4,000 different than somebody else. And so the differences that make the difference, but we have to show people how they can afford to get that right, because if they want something different, better and more, they’re going to have to find a way to pay for that difference over something else that they can get from somebody else.

00:02:19:11 – 00:02:48:03

And so that’s what, payment options do. And so to do that we use what I call leverage. Leverage is basically financing its payment plans. Right. A lever is a tool that makes the job easier. So what is leverage? In my mind, it is a convenient, flexible investment plan that makes buying what you want today and owning what you want easy and affordable, and allows what you save and energy and repair cost to offset the investment or at least pay for, you know, passively pay for the investment in its entirety.

00:02:48:06 – 00:03:10:04

So the key to this is to quit dropping the F-bomb in the home. And what do I mean by the F-bomb? The word financing. See what you use the word financing. Most people immediately are triggered with interest, and interest is obviously a turn off. And we want to turn people on to payment plate. So we need to use word s because words have meaning.

00:03:10:04 – 00:03:31:19

Words have power. Choose wisely. We need to use words that will allow customers to embrace financing, not drive them away from it. Because there’s people out there like Dave Ramsey and Suzy Orman and these other financial advisors that tell people, don’t finance it, don’t finance anything. That’s the worst thing that they could tell them, because using other people’s money is how the rich get richer.

00:03:31:22 – 00:03:55:04

Right? And it’s not surprising that maybe some people are trying to tell you not to use it, because maybe they don’t want you to join the rich people. I don’t know, right? Just got to say so. Leverage, though, is a tool that allows you to make, allows you to take what you make valuable right through your presentation and you’re sharing the findings and actually customers and make it affordable, more desirable, and obviously more attainable to the people that you’re talking to.

00:03:55:06 – 00:04:14:27

So it’s a level it just allows you to do your job in an easier fashion. So what types of, leverage are out there for using leverage? Right. There’s credit cards as a form of financing, as well as open ended revolving financing. And you can get these through all your lenders. And I’m going to provide you a lending resource here that includes all of this.

00:04:14:27 – 00:04:38:24

You’re shortly closed end financing home equity loans. She likes right. Home equity line of credit and FHA tool 2 or 3 loan for one K loan, you can take a load out of your own for one K to pay for your your partner to put the money back you with the penalties, the interest, the taxes. And that’s check approval.

00:04:39:01 – 00:04:56:28

There’s some, people out there that will do advanced checks. You don’t necessarily have to have, good credit to do that. You just have to not owe that any, entity, any money. And there’s leasing, which is, catching fire right now. Was it’s been very popular, always up in Canada, but it’s now coming down that states, quite, quite a bit.

00:04:57:00 – 00:05:13:29

And then there’s obviously you could take a loan from a friend, a family or, possibly from your boss at work, and then you can refinance or, basically put a mortgage, a new mortgage on your house. So those are all the forms of leverage that we have to be aware of to help our customers think about that.

00:05:13:29 – 00:05:38:06

Because if they even get sometimes get turned down with our financing or they don’t have credit or credit cards, we have to open up their mind to other forms of, money financing, if you will, that they can get on their own through other people that we have nothing to do with. But we should be the person who says, here’s what other people in your situation do when you know credit gets a little bit tight, and we know credit is getting a little bit tight out there in the market.

00:05:38:09 – 00:06:01:25

So we have to think about the bottom half of the screen to drive people towards, other, methods of payment that they may have access to. So why utilize leverage? Well, we talked about increasing sales. Well, it does create more opportunities for marketing, which I’ll talk about a little bit later. It allows you to reduce the sticker shock with small monthly payments because I mean, think about this.

00:06:01:25 – 00:06:27:04

How often do you personally cut section ten, 15, 20 or $30,000? Hardly ever. Personally. And so most of your customers don’t have that money sitting around either. Right. So small payment actions when you lead with them, reduce that reduces that sticker shock. It’s also the most expensive home improvement project. And yet it’s the least planned. Right. Because it’s something that kind of pops up on that.

00:06:27:06 – 00:06:44:28

It’s not something that they plan for. You can plan for. If you can plan for an addition or a remodel or new windows. Right. But when something dies or when she dies, you get to replace it and you’re not planning to pay for. So I want to think it over in customers minds usually means how am I going to pay for it?

00:06:45:00 – 00:07:03:10

And so when you get that strong and objections because they’re not sure how they’re going to pay for it, if you lead with payment options you’ve already made that you’ve already made the answer obvious. It makes you feel valuable and attainable. As I said a moment ago, it’s not only desirable and valuable, but now I get it. I get what I want, and people love payments.

00:07:03:18 – 00:07:25:29

90% of all cars are finance, and 7% of all, HHC projects are finance. So why are we leveraging it for our purposes? We need to do it. We need to do it better. You can help people get the experience that you desire, not just the one that they can afford. And 60% of the people who did buy, HDC through financing say they made the purchase more affordable.

00:07:26:02 – 00:07:44:18

And on average, they spent 150% more than without it. So it gets a higher average ticket as well. Helps you shift the mix of product to higher end product to your ultimately going to get happier customers because they can get more of what they want and they can get the things they want, not just the things that they can afford.

00:07:44:21 – 00:08:01:12

And with happier customers, we’re probably gonna have more happy customers because we’ll also get more reviews for repeat buyers, more referrals. And it’s a win win win for everybody in that way. That’s just going to increase company cash flow, because you’re going to get your money as soon as job is done and you’re going to increase your sales.

00:08:01:12 – 00:08:19:20

I like I said, not only you’re going to get higher closing ratios, what I call a connection ratio, but you get that higher average ticket as well. And that ultimately increases net profits. And that’s what we said we want to do. We want to increase sales, we want to increase profits. But as for other advisors, we also can increase personal income and that of the owner.

00:08:19:20 – 00:08:42:28

So and everybody on the team. Right. Because everybody’s always employed nobody sitting on the sideline. Hi I’m Darryl you shouldn’t ski. Hey I’m Bob Larkin. Many of our contractors meet with us monthly. And you chances are I’ve met with us monthly. We found that members have deeper and greater needs. So we came up with next level coaching, which is we meet a lot more often.

00:08:43:00 – 00:09:04:15

And there is accountability to deal with some of the issues of money growth, finding employees and having an exit strategy to get off this roller coaster. These are the issues the contractors want answers to, and we can provide those answers. The next level coaching. When you join next level coaching, you’re going to find solutions that are easy to implement and logical.

00:09:04:17 – 00:09:26:25

Most importantly, we hold you accountable to specifics. We’re going to meet twice a month and have specific to do’s. And with those specific to dos. We’re going to discuss and dive into your financials in a very granular way. You’re going to have a clear budget. We’ll be able to establish pricing. We’re going to help you create leadership programs to build your people.

00:09:27:02 – 00:09:49:00

We’re going to help you find people. You may think of differing ways to engage employees that will keep them more involved by joining next level coaching. So if you’re interested in making more money, growing your company, finding good employees, and developing them as a strategy, give Dale on our call. We’d be happy to talk to you about next level coaching.

00:09:49:03 – 00:10:09:00

We’re going to see you on the next level. Leverage also increases marketing and sales performance and increases the number of opportunities, right. So I said it would increase the chances you get, but it increases by 25% because if you include it in your marketing, you’re going to appeal to more people once they see in the marketing that you offer payment options.

00:10:09:07 – 00:10:30:08

And the payment could be as low as that. And I’ll show you some examples of that in a little bit. You’re going to increase that connection ratio closing ratio by another 25%. Right. And so if I was closing, you know, 3,040% before, you know, you could drive that up to about 65%, 4% closer ratios. Across all your leads, you’re going to increase your average ticket by a third.

00:10:30:14 – 00:10:52:23

Basically 30% increase in sales on each sale. Because people spend more money, you’re an increase complete system sales and sell sell components. And that’s great because now we have fully matching technology that works the way that it should, with matching warranties and guarantees to increase complete system sales by up to 20% increase, close to 75% plus by offer payment option.

00:10:52:23 – 00:11:14:16

Meaning when I see people that are not maximizing their performance as a salesperson closing as many opportunities, then you’re not going to close 100%. But you should close around 75 to 80% of what you run. Not just what you quote, but of what you run and payment options. Look, people see what’s affordable is how you get that last little juice and the squeeze out of what you’re running.

00:11:14:19 – 00:11:41:20

Chances are we like to run any more leads, and you can sell easily over $2 million a year of finance business. As an individual salesperson, our salespeople sell well over 2 million a year on financing. So some selling over 5 million total business, but at least 2 million of it can be finance or more. But if you really maximize things, you squeeze the juice out of every opportunity without just running five six leads a day.

00:11:41:20 – 00:12:02:15

If you run basically two leads a day, you should be able to sell easily $2 million of finance business in addition to probably at least another million or so worth of cash and check business and credit card business. So what are the top five ways to maximize sales and profits with payment was well, my opinion. They are utilizing multiple platforms as well as payment options.

00:12:02:15 – 00:12:24:13

And we’ll talk about how to do that. We’re going to work it into our marketing. I’m going to show you how to do that. We’re going to work it into our pricing tools. We’ve talked about that. And we’re going to use what we call a leading language. Right. Because words have meaning, words have powers. I want to lead people to finance, and then we’re going to train our people on how to utilize leverage and share payment options, because you have to have that skill.

00:12:24:16 – 00:12:51:15

It’s no different than a sales skill, but it’s a skill of not just presenting what you offer as far as products and services, but it’s also how do you share the money so that it makes sense. So let’s take a deeper dive on each one of these. You has multiple payment plans, payment options and platforms. And so utilizing that means deploying multiple lenders at you for the cost of those lenders record some of the plans have a deal or cost.

00:12:51:18 – 00:13:19:11

There’s also multiple different plans as far as Apr and length of term, as well as approval rates that you can get through multiple lenders, and that varies all the time. They change their progress throughout the year, their cost structure throughout the year, and their performance throughout the year. Things are changing up. Rate that are out there in the market, and so we need to have multiple resources at our disposal on batches, one through our manufacturer, because that is getting tighter and tighter than once in the manufacturer right now are getting really tight out there.

00:13:19:14 – 00:13:40:24

So I’m going to share with you, the platform that we still get over 90% financing for this, various levels of reduced Apr, meaning the, you know, the annual percentage rate of interest, with varying terms, we want to have different levels of those rates and different lengths of those terms to, because I’m going to show you how you can take that into your pricing in your shop.

00:13:40:26 – 00:13:58:07

So we want to have long terms at least, you know, 20 years. Some of your lenders will offer you a ten, 15, 20 years with a low annual percentage rate. And that’s going to allow you to get the lowest payment possible for your customer, because that’s what you want to lead with, not just the 0%. We’ll talk more about that later.

00:13:58:09 – 00:14:26:02

Right. No interest and or low pay. Low interest and no payment actions deferred payments and deferred interest options, revolving plans. I talked about that because everybody in this close in and so approval on a revolving plan is where they don’t just approach you for what you’re asking for. If they approve, approve you for as much as you qualify for, a closed end deal, if you get approved for just what you’re asking for.

00:14:26:04 – 00:14:54:00

The nice thing about a revolving plan is that, they have what is called the open to buy. And so if you don’t use all the financing when you start to pay down the financing, then you can work with your lender to say, okay, and what of my customers out there? They need to finance the system or something a year or two, five years ago, have money still left open on their account and your lender can give you access to that, and then you can market directly to those people and allow them to maybe buy something else.

00:14:54:00 – 00:15:10:09

So maybe you each year, see this time around, maybe some a generator or water heater or air quality stuff. The next summer. And there’s also what I like to call leasing. It’s a form of renting, if you really think about it. But you rent or lease to own, and then you can buy it out at the end of your term.

00:15:10:12 – 00:15:30:27

So you wanna have a lender that offers that, that has a customer stay liquid, keep their cash on hand and pivot and have the freedom of life that they desire. And what you’re seeing is that, millennials and Gen Z is really buying into the leasing. And once it kind of catches market fire, it will catch fire with kind of all the other generations to.

00:15:30:29 – 00:15:48:02

So you’ll also want to make sure that you, you tap into a local bank, maybe it’s your bank or credit union because they’re sometimes you can help a customer refinance. Their home or get a mortgage, and they can get better rates by opening an account on file with the bank and have a direct, debit from their account.

00:15:48:04 – 00:16:18:02

And so sometimes you can kind of work with your local lenders because their community charter, charter requires them to give back to the community. And so if you work with them and sell a plan and say, hey, here’s what we want to tap into, then what they might do is work with you directly to help those people that don’t get approved and maybe have a day or two on their credit contribution through your financing to help you, get them approved, because obviously heating and cooling is a need, as is hot water and power.

00:16:18:02 – 00:16:34:18

If you don’t generate. So you want to make sure you train your people to offer, payment options to improve the customer experience. You want to regularly review what’s available in the marketplace and update your plans. Because like I said, the rates change, the terms change. If, the rules change. And so you want to make sure you have, you know, the latest, greatest thing.

00:16:34:18 – 00:16:53:20

And I always tell, companies that review this program at least once or twice a year, you want to make sure you make it easy for customers to get pre-approval. If they want that web application right on your website. Or you can do phone approvals as well. Some of your lenders do that so that you can leverage innovation and payment technology to drive purchases.

00:16:53:20 – 00:17:16:12

And so some of us had, some lenders that had, applications on our phones or tablets and so, web apps and, payment options like that allow you to be transparent and have maybe one point of application, but get, access to a myriad of lenders. I’ll show you, share one of those with you. Sure. You want to make sure you appeal to all buyer types, right?

00:17:16:13 – 00:17:38:19

A credit be credit. See credit. There’s you can have a credit card visual for leasing and all the different credit profiles you can see to get this approval rates maximize and then choose your payment partners that help you to grow. And if they’re working with you, they’re not squeezing you and making life difficult for you. Because again, when credit gets tough for them, they get tough on you.

00:17:38:21 – 00:17:56:05

So what do we have to do? We have to make sure that we appeal to all the buyer types that are out there. Of course, you know the cash buyers, they have the cash they’ll pay upon completion. I’ll give you money or they’ll give you a check upon completion. We don’t have to worry about those, but we need to make sure that we let people that know that, yes, of course we accept checking credit for that.

00:17:56:07 – 00:18:16:16

Check your cash. But inflation, most people don’t do it that way. But that’s the way I leave it. Then I’ll talk about that in the last section that we have to appeal to the crisis buyers. They may have the money, but they’re hesitant to write the check. And so that’s where we offer, free payments for 12 months, you know, 0% option for 12 months.

00:18:16:18 – 00:18:37:18

Then you have that the, the people who want to use other people’s money, they may or may not have the cash. And so you offer them to do same as cash check. And that’s where we can offer equal payments. There’s no fee for the consumer. Obviously there are different cost to you with all of this. And of course, those people can also use credit cards and talk about leveraging credit cards a little bit later.

00:18:37:21 – 00:18:58:16

But even Warren Buffett, True story financed his system from 0 to 36. He bought man a system for his home in Nebraska, and he basically said, I’d be informative to somebody else. How do you think I got so rich? Is what he said to the contractor who sold the system, and that that country was on that system. And buyers, they want or need the lowest monthly payment time.

00:18:58:18 – 00:19:17:15

And that’s going to be that large, large chunk of your base. It should be when you get good at this and pay. So you’re saying all my customers pay cash? Exactly. All your customers. There’s a lot of people who would do business with you if they saw that they could. And could afford to do it. Okay. We also have to appeal to the credit challenge.

00:19:17:18 – 00:19:36:21

Okay. These are the people that, you know, they’re not going to get approved of, you know, the best plans. So they basically, you know, are about 30 to 40% of the market out there. And they don’t get that a lender, they they get turned down. And so you need a second. What we’ll look at the B, C and D paper.

00:19:36:23 – 00:20:05:25

And you also have to appeal to those that want to advantage leasing. And so some people are not committed to that. You know to living in the space, let alone basically spending all their money for something that they know they’re probably going to stay in for 15 to 30 years with the 30 year mortgage. Right. And so living in this shared a college, what we call the sharing economy gives people the flexibility through leasing or renting to some extent, flexible life with the freedom to have the life they desire by leasing it.

00:20:05:25 – 00:20:22:12

I don’t have to come up with any of the money. And you cover all the costs for everything for, let’s say, ten years. I get my new system all past labor covering for ten years. All maintenance is covered for ten years, all filters are covered for ten years. Humidifier pads. You’re the light bulbs. Everything is covered for ten years.

00:20:22:15 – 00:20:43:19

I don’t have to think about anything except a small monthly payment and a lower utility bill. That’s the beauty of leasing. And then at the end of ten years, I can buy it out or I decide to sell the house. I could disclose it and transfer the lease to the the home buyer is buying the house. Or I can just get a new system and pay the new small monthly payment.

00:20:43:22 – 00:21:09:22

So lots of flexibility there. On leasing. The cool thing about payment options is and allows customers to overcome what we call cash separation anxiety. And in this economy, everybody’s being buys a hold onto your cash. Yes, the dollars and less. And yes, people are making the runs on the banks. That’s why people are holding onto their cash. But if I need something, I want to hold on to my cash, that I need something, I got it, I got to take advantage of some way of getting it.

00:21:09:25 – 00:21:30:11

Well, I also have the claim credit. You’re making money available to me. That’s the beauty of finance. And this right here, that idea gives you all of those things and more okay. With 90% plus approval ratings. So highly suggest you’re looking to opt in this financing, give you the website right there to kind of take a look at that.

00:21:30:13 – 00:21:53:10

And they can get you set up quick and easy and gives you basically a tool that is seamless, self-critical, upfront. Right. It doesn’t take the customer’s credit report and then gives them the program that they will be approved at. Like I say, 90% of time. And so so they’re experiencing getting shut down and feeling bad or you feel bad and it’s sometimes a little awkward when I tell you how to handle that.

00:21:53:10 – 00:22:12:02

But we do teach you that through the sales here at the gig. Optimists results in fewer those ten minutes. So that’s why I always feel better for you and better for the customer. Right. So number two, work into your marketing. Right. So what do I mean by that? Well, number one, include payment options in your marketing for all buyer types like we talked about in the previous section.

00:22:12:02 – 00:22:29:13

Right. All buyers let people know they get paid. I actually get 0% as well. And you don’t need to talk about credit cards. You but you quickly credit card and you’re marketing as well. That should be on your website that you accept credit cards, but you also can promote buying with no money down and as little as X dollars a month.

00:22:29:15 – 00:22:46:17

And I’ll show you how we do that here. Actually, we’re also going to mention how by doing a small monthly payment, it can be offset by what you saved energy repair costs. And so we talked about that really. And that way you get what you want today. And then you can let the tiny utility company help to pay for it.

00:22:46:19 – 00:23:07:24

As I always ask the customer, yeah, how do you pay agility that way. So on the basis I said, well, most people basically like to pay for what uses the energy on a monthly basis as well. And that way we can see, the letter, basically becomes a net out of pocket, $47 a month. And they can also basically take another plan that they want and not to pay a dime in interest.

00:23:07:24 – 00:23:30:09

So we promote both that because we’re appealing to both audiences. And then we also basically highlight again how energy repair cost savings cover that in the red copy. And so that’s a portion of the letter of the letters. Like I said, two pages of detail. And then here’s the Johnson book. So Johnson backs basically takes what we’ve said in the letter towards the end of the letter and highlights it in bullet points.

00:23:30:16 – 00:23:49:27

And again, we highlight the financing right in the Johnson box, because that’s kind of just summarizing everything. So they read through the letter. They now see the summary. And again we highlight that. So it draws them to a conclusion. And then right after this box is what we call the call to action.

00:23:50:00 – 00:24:28:08

Awesome content right there. As always, be sure to share this on Facebook. And if you’re not a member, click the button below to get a free trial. I’ll give you access to all of our amazing content. Well, that’s our show for this week, folks. We’ll see you soon. And till then, bye bye for now.