Jim Plavecsky spoke to Fenestration Day attendees on creative financing options.

As part of Fenestration Day, which took place yesterday at the El Tropicano Riverwalk Hotel in San Antonio, dealers, for the first time, had an avenue for learning as the event included a track of sessions devoted specifically to their needs. The program included a number of sessions, including one that focused on creative financing options.

Jim Plavecsky of Windowtech Sales began by going through four financing options: cash, same-as-cash, unsecured loans and secured loans. He said the average window deal is about $7,500.

While three people in the audience noted they used the same-as-cash options, others said a lot of their business is based on cash.

Plavecsky said there is a disadvantage of cash. “Could you have sold more windows if financing was readily available?” he asked. “The advantage of same-as-cash is it often turns a maybe into a yes. The disadvantage is the customer may demand a discount in lieu of free money.”

According to Plavecsky, 80 percent of people who use same-as-cash don’t pay it off during the same-as-cash period and this translates into a loan with a double-digit interest rate.

“Unsecured loans are loosening up a little bit. The consumer doesn’t have to put up collateral [for] amounts up to $7,500,” said Plavecsky. “This rather low credit limit is a disadvantage but the interest rates are decent.”

According to Plavecsky, secured loans can go up to $24,000 for up to 240 months.

“The minimum FICO is 660, which is good as you can get a good amount of customers at that range,” he said.

The last option is refinancing.

“Say you do their windows, roof, etc. That is where this would be beneficial,” said Plavecsky.

“Tell customers they can save their cash and use it for other items. This will take you about 30 days, as an appraiser will have to come out, etc.,” said Plavecsky. “This is a great option if you have someone with a decent FICO score.”

He also told his audience, “You have to be creative with how you offer the options. If you know the value of your product really well and you sell it well and the customer adds up all those value points that will make a big difference.”

And he added, “It’s a cool thing if you can integrate your financing and marketing.”

However, there can also be challenges.

“Financing can squeeze your profit margin,” said Plavecsky. “But that could be better than not getting the sale at all.”

He advised, “Get the best salespeople you can get. You are only going to get orders through stellar salesmanship. These dealers are dying for training. They want it. The good salespeople are craving knowledge.”

Another point of advice he shared was to differentiate products.

“If the consumer perceives you have more value you can roll it all in,” he said. “Tell your finance companies you need instant approvals. Tell them you want the money funded to the dealer.”

One dealer in the audience asked if using financing will increase sales.

Plavecsky responded that the fact that he asked that question shows that more dealer education is needed on financing solutions and how it can help improve their businesses.

At the same time, another dealer in the room was very knowledgeable and shared a lot of feedback, resulting in a great give-and-take type seminar.

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