Consumer financing refers to the lending of money to consumers. For auto body repair shops, allowing financing to your customers can be an excellent way to expand your business operations and to provide value to your consumers by making major repairs significantly more affordable.
Car repairs are often some of the largest expenses that consumers have to make. Sometimes, a consumer just doesn’t have the cash on hand to cover potentially thousands of dollars in auto expenses. This is where consumer financing comes in for auto body repair shops.
If, as a business owner, you extend a line of credit to the consumer, you can make auto repair expenses more manageable to your customers. This not only encourages them to give you their repeat business, it also encourages them to be proactive in getting repairs done on their vehicle, which could lead to a beneficial long term relationship with your customers.
Many motorists are scared to take their car to an auto body repair shop because they are scared of the sticker price. If that price can be made more manageable by extending a credit line to the customer, then the customer would be much less hesitant to get his car repaired.
There are certain considerations that you must keep in mind, however, before extending credit to your customers. First and foremost, it is a good policy to check the credit of your customers in some way. Whether you run a credit report, verify employment status, or employ some other method, it is important to make sure that the customer applying for credit is in good financial standing. It is also important to establish clear terms of the financing with your customers, to ensure complete understanding and prompt repayment.
Once financing terms are arranged, then your customer will be free to enjoy the benefits of consumer financing for their auto body repairs, and you will benefit from the additional business and goodwill with your customers.