Offer finance for jewellery and luxury watches

Offer Finance for Jewellery and Luxury Watches

The world of luxury goods, particularly high-end jewellery and luxury watches, has long been associated with exclusivity, quality, and status. However, such items often come with a significant price tag, making them less accessible to many potential buyers. Offering finance options for jewellery and luxury watches can help bridge the gap between desire and affordability, opening up opportunities for more customers to purchase these coveted items.

In this article, we will explore the benefits of offering finance for jewellery and luxury watches, the various finance options available, and how Kandoo, a UK-based retail finance broker, can help retailers implement and manage these services effectively.

Why Offer Finance for Jewellery and Luxury Watches?

In today’s consumer-driven market, flexibility in payment options is essential. More and more customers expect to have a range of payment solutions when making high-value purchases. Offering finance can provide numerous benefits for both retailers and customers.

Increased Accessibility for Customers

Luxury jewellery and watches are significant investments, often costing thousands of pounds. For many, the idea of paying the full amount upfront can be daunting, if not impossible. By offering finance options, retailers can make their products more accessible to a wider audience. Customers who may not have been able to afford a luxury item outright can now spread the cost over a period of time, making the purchase more manageable.

Boost in Sales

For retailers, offering finance can directly lead to an increase in sales. According to research, retailers that offer finance options tend to see a rise in conversion rates and average order value. When customers are given the option to spread the cost, they are more likely to purchase higher-value items or add more products to their shopping basket.

Customer Loyalty and Repeat Business

Providing flexible payment solutions can also improve customer satisfaction and loyalty. Customers appreciate having options that cater to their financial needs, and a positive shopping experience is likely to encourage them to return for future purchases. Additionally, offering finance can help differentiate a business from its competitors, especially in the luxury sector where customers often look for premium service as well as premium products.

Competitive Advantage

In a competitive marketplace, offering finance can give a business a significant edge. Customers are more likely to choose a retailer that provides convenient payment plans over one that requires full payment upfront. In the luxury goods sector, where purchases are often planned and considered over time, the ability to offer finance could be the deciding factor that leads a customer to choose one retailer over another.

Types of Finance Options for Jewellery and Luxury Watches

There are several finance options that retailers can offer to their customers. These vary in terms of repayment terms, interest rates, and eligibility requirements. Below, we explore some of the most common finance options available for jewellery and luxury watches.

0% Interest Finance

One of the most popular finance options is 0% interest finance. This allows customers to spread the cost of their purchase over a set period of time without paying any interest. Typically, the repayment period ranges from 6 to 24 months. Retailers often absorb the cost of the interest, making this an attractive option for customers who want to avoid paying more than the item's price.

Offering 0% interest finance can be particularly effective in encouraging customers to make high-value purchases, as it allows them to enjoy their luxury item immediately without the financial strain of a large upfront payment.

Interest-Bearing Finance

Interest-bearing finance is another option, where customers spread the cost of their purchase over a longer period but with interest applied. The interest rate can vary depending on the lender, the value of the item, and the customer’s credit score. While customers may pay more overall compared to 0% interest finance, this option allows for more flexibility in terms of repayment duration.

For retailers, offering interest-bearing finance can reduce the financial burden of covering interest costs themselves, while still providing customers with the opportunity to spread the cost of their purchase.

Buy Now, Pay Later (BNPL)

Buy Now, Pay Later (BNPL) schemes have become increasingly popular in recent years. These allow customers to make a purchase and defer payment for a specified period (usually 30, 60, or 90 days). After this period, the customer can either pay in full or choose to spread the cost over several instalments.

BNPL is a flexible option that appeals to customers who want to make a purchase without committing to immediate payments. It can also be particularly useful for customers who are waiting for funds to become available, such as those expecting a bonus or a tax refund.

Split Payment Plans

Split payment plans are similar to BNPL but typically involve a set number of equal payments over a short period, often 3 or 4 months. This option can be attractive to customers who want to avoid long-term commitments but still prefer not to pay the full amount upfront. Split payment plans are easy to understand and manage, making them a simple yet effective option for both retailers and customers.

How Kandoo Can Help Retailers Offer Finance

Implementing finance options in a retail business can seem like a daunting task, especially for small and medium-sized enterprises. This is where Kandoo, a UK-based retail finance broker, can be of significant assistance. Kandoo specialises in connecting retailers with lenders, ensuring that businesses can offer a range of finance options to their customers without the need for complex administration or financial expertise.

A Simple and Streamlined Process

Kandoo offers a simple and streamlined process for retailers to offer finance to their customers. Retailers can integrate Kandoo’s finance solutions into their existing sales process, whether online or in-store. This allows customers to apply for finance quickly and easily, often receiving a decision within minutes.

For retailers, Kandoo takes care of the behind-the-scenes work, such as liaising with lenders and managing the finance agreements. This frees up time and resources, allowing businesses to focus on what they do best – selling luxury products and providing excellent customer service.

Access to Multiple Lenders

One of the key benefits of working with Kandoo is access to a wide panel of lenders. This means that retailers can offer a variety of finance options to suit different customer needs and credit profiles. Whether a customer is looking for 0% interest finance, BNPL, or a longer-term repayment plan, Kandoo can help retailers find the right solution.

Compliance and Regulatory Support

Navigating the regulatory landscape of offering finance can be complex, particularly in the UK where businesses must comply with the Financial Conduct Authority (FCA) regulations. Kandoo helps retailers ensure that they are fully compliant with all relevant laws and regulations. This includes providing clear terms and conditions to customers, ensuring transparency in the finance agreements, and protecting both the retailer and the customer from potential legal issues.

Increased Customer Satisfaction

By partnering with Kandoo, retailers can offer their customers a seamless and hassle-free finance experience. Kandoo’s platform is user-friendly and designed to make the finance application process as straightforward as possible. This enhances the overall shopping experience, increasing customer satisfaction and encouraging repeat business.

The Benefits of Offering Finance Through a Broker

While some retailers may consider setting up their own in-house finance solutions, working with a broker like Kandoo offers several distinct advantages.

Expertise and Knowledge

Kandoo’s team of experts has extensive knowledge of the retail finance market and can provide valuable advice and guidance to retailers. This ensures that businesses are offering the most suitable finance options for their customers and maximising their potential sales.

Reduced Risk

When offering finance, there is always an element of risk involved, particularly if customers default on their payments. By working with a broker like Kandoo, retailers can mitigate this risk. Kandoo works with reputable lenders who assess the creditworthiness of customers before approving finance applications. This reduces the likelihood of defaults and ensures that retailers are paid promptly for their sales.

Cost-Effectiveness

Setting up an in-house finance solution can be expensive and time-consuming. Retailers would need to invest in the necessary infrastructure, software, and staff training. By partnering with Kandoo, businesses can avoid these costs and benefit from a ready-made finance solution that is cost-effective and efficient.

Conclusion

Offering finance for jewellery and luxury watches is a powerful tool that can help retailers attract more customers, increase sales, and improve customer loyalty. With a variety of finance options available, from 0% interest finance to Buy Now, Pay Later schemes, retailers can cater to the diverse needs of their clientele.

Partnering with a retail finance broker like Kandoo simplifies the process of offering finance, providing access to multiple lenders, ensuring regulatory compliance, and reducing risk. By leveraging Kandoo’s expertise and streamlined platform, retailers can focus on what they do best – selling luxury products and delivering an exceptional customer experience.

In today’s competitive market, offering finance is no longer just an added bonus – it’s a necessity for retailers looking to thrive in the luxury goods sector. By making high-value items more accessible to a wider audience, retailers can unlock new opportunities for growth and success.