How to Offer Customer Financing on the Truck

Why This Matters

Customer financing drives 2 measurable outcomes: higher close rate and higher ticket. On a residential HVAC install with a $9,400 price tag, the cash close rate averages 31 percent. The financing close rate on the same jobs averages 57 percent, a 26 point lift. On 50 install quotes a month, that is 13 additional closed installs at $9,400 each, or $122,200 in additional monthly revenue. At 52 percent gross margin, that is $63,544 in additional monthly gross profit purely from offering financing. The dealer fee (typically 4 to 9 percent) costs roughly $5,500 on that $122,200 in additional revenue, leaving $58,000 in net lift per month, or $696,000 per year. Financing is not a feature, it is a profit center. Shops that run financing on every $1,500+ job see double digit net profit improvements within 90 days of launch.

The Steps

1. 1

   Step 1: Choose a finance provider that fits your trade

   The major residential service finance providers are Wisetack, Synchrony, GreenSky, Foundation Finance, and Service Finance. Each has different approval rates, dealer fees, and consumer rate cards. For HVAC and plumbing, Wisetack and Service Finance tend to approve 68 to 78 percent of applicants with soft credit pulls. Dealer fees run 4 to 9 percent of the financed amount depending on promo terms. Pick one provider to start, not three. Managing multiple providers fragments tech training and confuses customers. Signup is typically free with no minimum volume requirements.

   Pro tip: Ask for 12 month zero interest promotional terms on residential repairs under $5,000.

2. 2

   Step 2: Understand the dealer fee and bake it into your pricing

   Every financing transaction charges the dealer (you) a fee that comes off the top of the financed amount. On a $9,400 job financed at 6 percent dealer fee, you receive $8,836. This fee is the cost of doing financing. Some shops absorb it as a marketing expense. Smarter shops bake it into the quoted price so the customer pays the financing cost, not the contractor. To bake it in, divide your target price by 0.94 (for a 6 percent fee) to get the new price. On a $9,400 job, the adjusted quote is $10,000. The customer still gets the financing benefit and you preserve margin.

   Pro tip: Never advertise zero interest without understanding where the dealer fee is coming from.

3. 3

   Step 3: Train techs to offer financing on every job over $1,500

   Every job quote over $1,500 must include a financing option, presented verbally, without the customer asking. Script: 'Mrs. Thompson, the water heater install is $2,489 total. You can pay that in full today, or we have 12 months of zero interest financing which would bring this to about $208 a month. Either is fine with me. Which works better for you?' Notice the price is stated first, then the monthly payment, then the choice. This ordering protects the value perception while still making financing feel like a normal option.

   Pro tip: Never lead with the monthly payment. Lead with the total, then reveal the monthly as an option.

4. 4

   Step 4: Run the application on the tablet in under 3 minutes

   When the customer chooses financing, open the finance provider app on the tablet, enter the customer's name, address, income, and SSN, and submit. The soft credit pull completes in 10 to 30 seconds and shows an approval decision, credit limit, and available promo terms. For approved customers, show the monthly payment breakdown on the tablet, collect an electronic signature, and the funds are deposited to your account within 1 to 3 business days. The entire process from first offer to signed agreement runs 3 to 5 minutes when the tech is practiced. Anything slower loses deals.

   Pro tip: Always ask the customer to enter her own SSN. Techs should never type sensitive personal data.

5. 5

   Step 5: Handle the rejection gracefully

   Not every application is approved. If a customer is declined, keep the conversation warm and offer alternatives. Script: 'The system was not able to approve you for this option, but that happens for a lot of reasons that have nothing to do with you. I can split this into a deposit today and a second payment in 30 days, or we can look at a smaller scope that fits the cash budget. What works best for you?' Never make the customer feel judged for a declined application. The goal is to preserve the relationship and still close some portion of the work.

   Pro tip: Offer a deposit and invoice plan for declined customers. Half a sale beats no sale.

6. 6

   Step 6: Track financing metrics weekly

   Add 3 metrics to your weekly review: percentage of $1,500+ jobs offered financing, percentage of offered financing that was accepted, and average ticket of financed jobs versus cash jobs. You should see offered rate above 95 percent (every qualifying job), acceptance rate around 35 to 45 percent, and financed average ticket 25 to 35 percent higher than cash average ticket. If offered rate is below 95 percent, your techs are skipping the pitch. If acceptance rate is below 25 percent, the presentation needs work. Data drives the coaching decisions.

   Pro tip: Pay techs a spiff ($25 to $50) for every financed job to keep the habit strong.