Many of the most successful RMR salespeople we know talk in monthly payments from the very start of a sales conversation. When a customer asks them to quote a price on a technology system, the monthly payment is presented – not the overall cost of the system.
Taking this approach isn’t beneficial only for you (bringing in regular revenue each month), but it’s also beneficial for your customers. According to GreatAmerica, an NSCA Business Accelerator, there are a few reasons you should consider leading your sales conversations with monthly payments.
1. Makes Technology Purchases Tolerable
Showing your customer the full cash price puts the entire weight of the purchase on them all at once. (Much like the feeling you get when shopping for a new home or car. Looking at the overall purchase price is much more intimidating than looking at the monthly payment!)
Instead, showing clients a monthly payment helps soften the financial blow, and lightens the weight of the purchase. This makes the investment much more tolerable, and it’s easier for them to quickly determine whether or not they can afford it.
2. Makes Financial Sense
Technology doesn’t hold its value – it depreciates. As J. Paul Getty, founder of the Getty Oil Company, always said: “If it appreciates, own it. If it depreciates, rent it.” If something holds its value (or will increase in value over time), it makes complete sense to own it. (Examples might be land or buildings.)
Once a technology system is installed, however, it will never be worth more than it is right now. Owning items that depreciate in value over time don’t move anyone forward. Much like a car that immediately depreciates in value once it’s driven off the lot, technology loses its value from Day One as well.
3. Includes Service and Maintenance
If you asked your customers whether it was crucial that they own their technology systems, the majority would likely say that they don’t care about “owning” their technology – instead, they care about having easy access to it (and constant uptime).
For this reason, wrapped up into a monthly payment should be any service, maintenance, or upgrade fees that will be required for the technology. This way, your customer doesn’t incur any additional expenses when a system requires attention, ensuring that the technology is always updated (and removing system maintenance and management from their list of to-dos).
4. Ensures Automatic Technology Upgrades
Monthly technology payments prevent your customers from being locked into a specific technology or system until it becomes antiquated. They can more easily keep up with the latest technology, relying on you to make updates and upgrades.
Instead of working with a digital signage system or videoconferencing solution that’s more than a decade old, you can reach out to them once a certain number of payments remain. Let them know that it’s time for a technology refresh, and that they can upgrade their systems while continuing with the same (or very similar) monthly payment.
5. Allows for Consistent Budgeting
When the end-user has a flat monthly fee they know they’ll pay every month, it makes budgeting and financial planning easier. Instead of finding a large sum of money to put toward a new technology system, they can plan to pay a much smaller monthly fee over a certain period of time.
6. Facilitates Easier Approval
Because it’s no longer a capital purchase, many end-users have an easier time gaining approval when they present a low monthly payment to the powers that be – instead of a five- or six-figure number that comes out of the capital budget vs. the operating budget.
To learn more about the power of quoting a monthly payment, login to watch the archived webinar, The Power of Quoting a Monthly Payment, presented by GreatAmerica. To learn the secrets of building an RMR stream, check out these three steps.