Small businesses can take a long time to get off the ground, especially when they’re under-capitalized or have poor cashflow. It’s possible to circumvent this problem by starting a micro or home based business for a few thousand dollars, or to bootstrap a somewhat larger organization by cutting corners and furnishing an office space with Ikea furniture. That might be enough for some companies to launch, but in many industries, a more professional space can make or break ones ability to acquire new clients. According to the SBA, the Kauffmann Foundation estimated that a small business can cost on average $30,000 to get off the ground back in 2009. With inflation, add another 10% to the total cost today.
Using a furniture cost calculator like this one can show how quickly the costs can add up. But even with the sticker shock associated with furnishing a professional office, it’s possible to convince small businesses to spend more on their furniture in a way that can actually improve their cashflow and acquire more clients. That’s because businesses now have one more tool at their disposal to help them make the investment in quality furniture: Splitit.
Sell More Furniture by Offering Installment Plans
Splitit is a unique payment solution that enables customers to pay for their purchases in installments, using their existing credit cards, all while saving the interest charges that would normally apply to an unpaid credit card balance. For big ticket purchases such as furnishing an office, the savings can add up quickly. Not only can new and existing small businesses benefit from paying for new furniture in installments, but office furniture stores can benefit from offering installment payment plans as well.
Using the patented installment payments platform provided by Splitit, furniture companies can offer interest-free installment plans to their clients, who use their existing credit cards to make the payments. Because there are no credit checks, clients can get their furniture faster. Qualifying merchants can even collect the full purchase price up front for a small fee while Splitit bills the customer’s card on a monthly basis. While the small business client benefits from better cashflow with this arrangement, it also presents the furniture provider with an opportunity to sell high ticket items. This is because small businesses understand the value of a great first impression, and having a well-designed interior space does just that.
In the past, businesses would take out working capital loans for such expenditures and pay extremely high interest rates on these loans. With Splitit, small businesses no longer have to take out such high interest loans and can make their furniture purchase in installments, without interest charges. It’s not hard to show a client how much money they will save in interest charges alone, not to mention the improvements to cashflow, all without sacrificing quality. The end result is that the furniture company’s Average Transaction Value (ATV) goes up, while the small business gets a better product, and the freedom to utilize their cashflow in other ways to grow.
In effect, by offering a credit card installment payment plan using Splitit, the furniture company is actually helping the small business acquire the right tools to sign new clients more rapidly. It’s easy to see how offering unique payment solutions to office furniture customers can help both the buyer and the seller. Selling more furniture to growing businesses and small start-ups, all while improving their cashflow situation means more money for the furniture store, and unhindered growth for the buyer. They’ll remember you when it’s time to make their next furniture investment, and will likely recommend your furniture business to their colleagues.