Offer finance for gadget shops (drones, vr headsets)

Why Offering Finance is Crucial for Gadget Shops

In today’s rapidly evolving tech landscape, gadgets like drones, VR headsets, and other cutting-edge devices have become increasingly popular. Whether for personal use, professional applications, or as gifts, consumers are keen to get their hands on the latest technology. However, the price tags associated with these high-tech gadgets can be a significant barrier to purchase for many customers. Offering finance options in your gadget shop can be a game-changer, making these products more accessible to a broader audience while also boosting your sales.

The Growing Demand for High-Tech Gadgets

The demand for gadgets like drones and VR headsets has skyrocketed in recent years. Drones are no longer just for hobbyists; they are now used in industries ranging from filmmaking to agriculture, real estate, and even search and rescue missions. Similarly, VR headsets have moved beyond gaming and are being used in education, training, and therapy.

However, these gadgets come at a price. High-end drones can cost upwards of £1,000, while advanced VR headsets can range from £300 to £800 or more. While some customers are able to pay for these gadgets outright, many find the upfront cost prohibitive. By offering finance options, you can open the door for more customers to make a purchase they might otherwise have deferred or abandoned.

How Finance Options Can Benefit Gadget Shops

1. Increased Sales

The most obvious benefit of offering finance options is the potential for increased sales. When customers are presented with the option to spread the cost of their purchase over time, they are more likely to commit to a purchase, especially for high-ticket items like drones and VR headsets. By reducing the financial burden, you encourage more customers to buy from you, which can result in a significant boost to your revenue.

2. Higher Average Order Value

Offering finance doesn’t just increase the number of sales; it can also lead to higher average order values. Customers who might have been hesitant to purchase a top-tier model due to its price may be more inclined to opt for a higher-end product if they can pay for it in instalments. This means that, in addition to selling more units, you may also be selling more expensive gadgets.

3. Competitive Advantage

In a crowded market, offering finance can set your gadget shop apart from the competition. Customers are increasingly expecting flexible payment options, and shops that fail to offer them may lose out to competitors who do. By providing finance options, you not only meet customer expectations but also position yourself as a forward-thinking retailer that understands and caters to the needs of modern consumers.

4. Building Customer Loyalty

When customers have a positive purchasing experience, they are more likely to return. Offering finance can enhance the customer experience by making it easier for them to buy the products they want. Additionally, customers who take advantage of financing options may be more likely to return for future purchases, knowing that they have the flexibility to pay over time.

Types of Finance Options You Can Offer

There are several different types of finance options that gadget shops can offer, each with its own benefits for both the retailer and the customer. Understanding these options can help you decide which is the best fit for your business.

Interest-Free Credit (0% Finance)

One of the most attractive finance options for customers is interest-free credit, also known as 0% finance. This allows customers to spread the cost of their purchase over a set period without paying any interest. For example, a customer might be able to pay for a £600 drone over 12 months, making monthly payments of £50 with no added interest.

While this option is very appealing to customers, it’s important for retailers to carefully consider the costs associated with offering interest-free credit. In many cases, the retailer will need to absorb the cost of the interest, which can eat into profit margins. However, the potential increase in sales and customer loyalty may outweigh these costs.

Buy Now, Pay Later

Buy Now, Pay Later (BNPL) is another popular finance option, particularly among younger consumers. With BNPL, customers can take their gadget home immediately but delay payment for a set period, often 30 to 60 days. Some BNPL options also allow customers to split the payment into smaller instalments.

This option can be particularly appealing to customers who may be waiting for their next payday or who want to try the product before committing to a full payment. For retailers, BNPL can increase conversion rates by reducing the friction at checkout.

Traditional Instalment Loans

Another option is to offer traditional instalment loans, where customers make monthly payments over a longer period, typically with interest. While this option is less appealing to customers than interest-free credit, it can still make high-ticket items more affordable by spreading the cost over time.

Financing Through a Third-Party Broker

One of the easiest ways for gadget shops to offer finance options is to partner with a third-party finance broker, such as Kandoo. Kandoo is a UK-based retail finance broker that specialises in helping businesses offer flexible payment options to their customers. By working with Kandoo, you can provide your customers with a range of finance options, without the hassle of managing the process in-house.

Why Partner with Kandoo?

Partnering with a finance broker like Kandoo can offer several advantages for gadget shops:

1. A Simple and Seamless Process

Setting up a finance programme on your own can be complex and time-consuming. By partnering with Kandoo, you can offer finance options to your customers without the need to manage the administrative and regulatory aspects of the process. Kandoo handles everything from credit checks to loan agreements, allowing you to focus on running your business.

2. A Range of Finance Options

Kandoo offers a variety of finance options, including interest-free credit and traditional instalment loans. This allows you to provide your customers with the flexibility to choose the option that best suits their needs. Whether they want to spread the cost over several months or delay payment, Kandoo can help you offer the right solution.

3. Increased Conversion Rates

By offering finance options through Kandoo, you can increase your conversion rates. When customers have the option to pay in instalments, they are more likely to complete their purchase, especially for high-ticket items like drones and VR headsets. Kandoo’s easy-to-use platform makes it simple for customers to apply for finance and get a decision quickly, reducing the chances of abandoned carts.

4. Customer Support and Satisfaction

Kandoo provides excellent customer support, ensuring that your customers have a positive experience when applying for finance. This can help to build trust and satisfaction, encouraging repeat business and word-of-mouth referrals.

5. Compliance and Security

Navigating the legal and regulatory requirements of offering finance can be challenging. Kandoo takes care of compliance, ensuring that all finance agreements meet UK regulations. This means you can offer finance with confidence, knowing that both your business and your customers are protected.

How to Get Started with Offering Finance in Your Gadget Shop

If you’re ready to start offering finance in your gadget shop, here are the steps to get started:

1. Choose Your Finance Partner

The first step is to choose a finance partner that can help you offer the right payment options to your customers. Kandoo is a trusted UK-based finance broker that can provide a range of solutions tailored to your business. By partnering with Kandoo, you can ensure that your customers have access to flexible payment options that make purchasing high-ticket gadgets easier.

2. Decide Which Finance Options to Offer

Next, decide which finance options you want to offer. You may choose to provide interest-free credit for certain products, traditional instalment loans for others, or a combination of options. Consider the needs of your customer base and the types of products you sell when making this decision.

3. Promote Your Finance Options

Once you’ve set up your finance options, it’s important to promote them to your customers. Make sure that your website clearly displays the finance options available, and consider running marketing campaigns to highlight the benefits of spreading the cost of a purchase. You can also train your staff to inform customers about the finance options available in-store.

4. Monitor and Adjust

Finally, monitor the impact of offering finance on your sales and customer satisfaction. If you find that certain finance options are more popular than others, you can adjust your offerings accordingly. Regularly reviewing your finance programme will help you ensure that it continues to meet the needs of your customers and supports the growth of your business.

Conclusion

Offering finance in your gadget shop is a powerful way to make high-ticket items like drones and VR headsets more accessible to customers. By providing flexible payment options, you can increase sales, boost average order values, and build customer loyalty. Partnering with a trusted finance broker like Kandoo makes it easy to offer finance options without the complexity of managing the process yourself. With the right finance programme in place, your gadget shop can thrive in today’s competitive market.