How to take payments for your products or service can be hard to set terms. In this quick video we discuss how to get over that hurdle.
Video Transcription
Sunshine: Payment plans? Good, bad? Let’s find out.
Crystal: Welcome to the Love of Business. I’m Crystal.
Sunshine: And I’m Sunshine. Let’s get to it.
Payment plans?
Crystal: Yeah.
Sunshine: Good, bad?
Crystal: Well, that’s a great question. They can be good sometimes and they can be bad sometimes. Let’s do a deep dive.
The first thing that you need to know about payment plans is that you don’t want to advertise that you give payment plans. You want it to be a backup.
If the customer can pay full price right away upon delivery, that’s the ideal situation. Now, let’s say a customer is a little strapped for cash and they are probably going to ask you for a discount.
Well, we absolutely do not give discounts. But what we can offer instead of a discount is a payment plan, meaning they can pay over time. Now, you don’t want to offer a payment plan that is too long – too many payments over time. Like over six months or 12 months.
Ideally, you want the payment plan to be between two to four payments, maybe over two or four months. Because at the end of the day, what we are really trying to do is make the sale, make the customer happy, but keep our 100 percent margin.
Sunshine: I get it. So, it’s a win for the client and a win for the business owner.
Crystal: Win, win.
Sunshine: What’s your number one takeaway from today’s video? Leave us a comment and thanks for watching.
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