Tuesday, April 4, 2017

Vendor Leasing--What It Takes To Be The Best!

Capital Resources believes that our relationship with our vendors and their customers is our most valuable asset. There are some leasing companies that nail their vendors' customers with costly fees, unreasonable return provisions, biased end of term purchase options, and inflated fair market evaluations. Our experience indicates that this approach to business is very short sighted, and does not encourage long term customer relationships and profitable repeat business for our vendors.

Your customers are your most important asset. How you and your partners treat them will determine how long they remain doing business with you. It is painful enough to lose a customer to your competition because of something you did, but it is downright torturous if the loss was due to the actions of your leasing partner.

The following conclusions from recent studies support the importance of treating your customers with respect:

  • 68% of customers surveyed stopped buying from companies because of the indifferent way they were treated.
  • 10% - 30% of customers will be lost because of poor customer service.
  • It is 6-7 times more expensive to gain a new customer than to sell to a current one.

Unfortunately, too many leasing companies use a low price strategy to attract inexperienced equipment vendors. First, they offer below market lease rates to capture as much of the vendor’s business as possible. Then, in order to make a profit, they increase their yields to above market rates by charging the vendor’s customers additional fees throughout the term of the lease. Many of these fees are systematically woven into the lessor’s lease agreement and they are overlooked by the vendor and the lessee until it is too late to do anything about them. Again, hammering the lessee with these additional fees is not conducive to building long term customer relationships, and can be very costly for equipment vendors in terms of lost repeat business.

Experienced equipment vendors know that they should consider more than just a leasing company’s lease rates when selecting a leasing partner. Remember, low lease rates do not necessarily equate to high ethics, service, and customer satisfaction.

You and your customers will continue to be Capital Resources' number one priority. We will continue to be a professional, responsive, and competitive provider of financing services. Our agreements and business practices will remain fair and straightforward. Capital Resources will not jeopardize your relationship with your customers by charging them hidden fees or inflated end of term fair market valuations. Our goal is to ensure that your customers return to you time and time again.