This post was originally published on Auto Success
Consumers demand payment flexibility and affordability options today more than ever before. In today’s competitive automotive service landscape, offering financing options is no longer just a “nice-to-have” for auto parts and service retailers — it’s a critical tool in the retailer’s arsenal.
The benefits of financing flexibility extend far beyond simply making customer purchases more affordable. They convert more sales, drive revenue growth, enhance customer relationships and position your business for long-term success.
Innovative financing solutions can help dealership service departments as well as auto parts, service and tire retailers thrive. Whether it’s through traditional credit cards, buy-now-pay-later options or integrated digital solutions, various options are available to support your business goals.
Let’s look a bit closer at the benefits that flexible financing options deliver:
1. Increased Sales and Higher Average Ticket Sizes
One immediate impact of offering financing is a boost in overall sales and average transaction amounts. When customers have access to flexible payment options, they’re more likely to move forward with larger purchases or additional services.
Our research has found that 65% of consumers making a large automotive repair purchase agree that financing makes larger purchases more affordable. That same research also shows they are more than likely to choose a location that offers flexible financing and promotes its availability.
2. Improved Customer Loyalty and Repeat Business
Financing programs create a pathway for ongoing customer engagement and loyalty. By offering a branded credit card or financing solution, you give customers a reason to return to your business for future needs.
A well-known global tire OEM, one of our auto industry partners, has enrolled nearly 2,000 dealers in our financing program. The result? A 30% increase in year-to-date sales. This growth isn’t just from new customers — it’s driven by repeat business from cardholders who now have a dedicated line of credit for their auto needs.
3. Enhanced Customer Experience and Satisfaction
Financing options provide customers with greater flexibility and peace of mind, especially for unexpected or large expenses. This can significantly improve the overall customer experience and satisfaction levels.
Lakeland Toyota is a great example. They focused on consistently offering a branded credit card and communicating to customers how promotional financing can help them get needed parts, service and repairs while paying over time. By doing so, they saw a 32% increase in credit card sales in less than six months. This growth indicates that customers appreciate and use financing options when made readily available.
4. Competitive Advantage in the Marketplace
In an increasingly crowded market, offering financing can set your business apart from competitors. It shows that you’re committed to meeting customer needs and providing value beyond just products or services.
Dealerships can consider integrating financing in a way that enables them to offer on-the-spot financing options. This capability gives these businesses a significant edge over competitors who can’t provide the same level of convenience and flexibility.
5. Increased Ability to Up-sell and Cross-sell
Financing opens the door to more up-selling and cross-selling opportunities. When customers know they have a flexible way to pay, they’re more likely to consider additional products or services.
We’ve seen this play out with many of our partners. For example, when a customer finds out that their purchase of new tires is affordable via installment payments, they may decide to add ancillary purchases to that same visit, increasing the merchant’s revenues.
Financing as a Growth Strategy
In today’s digital-first world, it’s crucial to make financing options easily accessible across all channels. Look for a financing partner that continues to evolve its offerings, ones that create seamless, omnichannel experiences that meet customers wherever they prefer to shop — in-store, online or through mobile apps. By embracing financing as a core part of your business strategy, you’re not just offering a payment option — you’re opening up new avenues for growth, customer satisfaction and competitive advantage. The numbers speak for themselves — financing isn’t just good for customers; it’s great for business.
