How Lease-to-Own Financing Can Boost Your Bottom Line -

How Lease-to-Own Financing Can Boost Your Bottom Line

Sponsored by Snap Finance

It’s a common scenario for many tire dealers: a customer is shopping for a new set of tires but doesn’t have all the funds on hand to pay for the purchase upfront. You may try to resolve this by offering your own in-store credit option. But by going this route exclusively, you could miss out on sales and lose a significant and often overlooked customer base. 

The reason? Your credit-challenged consumers will likely have a hard time getting approved for in-store credit. These consumers include those with poor credit or those with little to no credit history – and they make up a significant portion of the American population.

Fortunately, there’s a way to prevent these missed opportunities – lease-to-own financing. Through this alternative financing solution, you can capture more sales and yield incredible results for your tire business.

What Is Lease-to-Own Financing?

A lease-to-own option is not credit or a loan. Instead, a lease-to-own finance company purchases the merchandise from the merchant, and then leases the merchandise to the customer. The customer takes the merchandise home and makes lease payments over time until they have made enough payments to obtain ownership.

Even better, the merchant doesn’t have to take on the risk that could come from a customer defaulting on payments. Lease-to-own creates an arrangement between the consumer and the financing provider. If a customer defaults, the provider takes the hit – not the merchant.

The Benefits of Lease-to-Own Financing 

Lease-to-own financing can have a significant impact on your bottom line. It can turn missed opportunities into closed sales and dissatisfied shoppers into loyal customers. Here are three powerful ways lease-to-own financing could give your tire business a boost:

1.     Broaden Your Clientele

A recent report from Oliver Wyman found that 28 million adult Americans are credit invisible, and 57 million have subprime or below credit scores. That’s a total of 85 million people who could benefit from an alternative financing solution. By providing lease-to-own financing in your store, you can give those who have poor credit, little to no credit, or who don’t want to rely on credit cards a chance to get the tires they need when they need them.

To qualify for lease-to-own, the applicant typically has their credit report pulled from special providers and not from the three major credit bureaus (Experian, TransUnion, and Equifax). Additional data, such as monthly income and having an active checking account, is also looked at, increasing the likelihood of approval. This allows you to reach a significant customer segment who want your product but can’t afford to pay for it in a single transaction. 

2.     Improve Average Order Value

Lease-to-own financing gives customers the power to make purchases that otherwise would not fit their budget while offering a repayment schedule that coincides with their paydays. When your customers no longer have to pay for everything in one lump sum, it could motivate them to go for a higher ticket item or to add on additional items. This means more closed sales at higher amounts – a win-win for your business.

3.     Drive Repeat Customers

In addition to bringing in new customers and more sales at higher amounts, offering a lease-to-own financing option in your store can also drive repeat business, according to a study done by the Federal Reserve Bank of Kansas City. Lease-to-own empowers your customers financially and creates an opportunity for them to afford big ticket items. Your shoppers will no longer feel limited to buying used tires or putting off purchasing altogether. This can go a long way in increasing customer loyalty and retention. A lease-to-own company like Snap Finance even markets directly to your customers through their Snap EDGE program, encouraging them to come back to your store for more.

For higher traffic, more sales, and greater revenue, tire shop owners would be wise to provide a lease-to-own financing option to their customers. If you’re ready to gain a competitive edge and reap the benefits of lease-to-own, visit https://learn.snapfinance.com/become-a-partner to learn how partnering with Snap Finance can take your business to new heights.

Sponsored By Snap Finance

You May Also Like

Lifecycle of Auto Parts: Are You Taking the Steps You Need?

Part 1: The Part Arrives, Time to Investigate Let’s start at the beginning of a part’s journey: the delivery. A part of your vehicle has failed–let’s say a fuel pump. After performing some research, you order the new pump, take it home, and open the box. Only for you to notice that there are pieces

Part 1: The Part Arrives, Time to Investigate

Let’s start at the beginning of a part’s journey: the delivery. A part of your vehicle has failed--let’s say a fuel pump. After performing some research, you order the new pump, take it home, and open the box.

A Closer Look: Electronic Throttle Bodies

A shop’s reputation is affected by things like accuracy of diagnosis, quality of the repair, and friendly service. Equally as important is the quality of the parts installed. If the shop does everything right, and the part fails, the customer will ultimately be upset with the shop. When a new part fails, the customer is

Advantages of a Pre-Assembled Knuckle Hub Assembly

Wheel bearings are a common repair, but they often present challenges during installation, taking additional time we don’t have to spare, and in some cases resulting in a comeback or quality that isn’t up to our standard. Generation 1 (press in) wheel bearings have always been the most difficult, and while Generation 3 (incorporated hub

Enhancing Efficiency and Streamlining Operations: The Benefits of Utilizing Nexpart Multi-Seller for Repair Centers

In today’s fast-paced automotive repair industry, staying ahead of the competition is crucial for repair centers to thrive. One key aspect that can significantly impact operational efficiency and customer satisfaction is the availability of OE, Aftermarket, Heavy Duty & Salvage parts. Here are just a few advantages of incorporating Nexpart Multi-Seller, a cutting-edge parts ecommerce

Protect Your Fuel Tank and Pump with Delphi Technologies

The fuel tank and pump are considered the lifeblood of a vehicle, supplying and circulating fuel to other critical components throughout the vehicle.  Delphi Technologies has been a manufacturer of fuel delivery parts for over 80 years, and a lot has changed since then. With over 30 OE-proprietary innovations and 150 patents in fuel technologies

Other Posts

A Closer Look: Emissions

The Check Engine Light (CEL) is arguably one of the most effective yet underappreciated advancements in reducing vehicle emissions. Following the introduction of On-Board Diagnostics II (OBD II), the CEL is illuminated continuously if an on-board system monitor has failed a specified number of times and is negatively affecting emissions. If a catalyst-damaging event, such

A Closer Look: Ignition Coils

OE coils are known for their high failure rates. Engine misfires, rough idle, a decrease in power under acceleration, poor fuel economy, and a check engine light are all signs of an ignition coil that has failed. Read along for more technical information on how to diagnose a failed coil, and why the original equipment

Get your vehicle road trip ready with these summer tips

Summertime is a great time to take your car out on the open road, but it’s also important to ensure that your vehicle is in tip-top shape. Regular preventative maintenance can help you avoid costly repairs and keep your car running smoothly. Make sure you’re ready with these helpful tips from Delphi Technologies. Chassis The

Engineering Behind Chassis: High and Low-friction Parts

When it comes to chassis parts, simplicity is the key to success. Overengineering components can not only make it more difficult to perform repairs, but it some cases may cause earlier repairs/failures in certain scenarios. What is overengineering? Overengineering is often described as designing a product or solution in an unnecessarily complicated way where a