Buy Now Pay Later

Worth offering?

[Phil_C]

I have a small number of competitors, all selling the same products at the same prices. I've been thinking of ways to get the edge over them and gain a few extra sales.

I've found a company offering this service to small/medium size businesses called Able2Buy. Empire Direct for example use them. I completed a contact form on their (rather poor) website, waited 4 days and heard nothing, rang them today and was given a mobile number of my "local" rep to call - shouldn't they be calling ME?! Anyway, not off to a good start, but I can't find any other companies handling this kind of finance. They do claim to have over 1,000 clients though including some big names.

My questions to the forum are:
1) Has anyone here (specifically in the UK) used the Buy Now Pay Later tactic?
2) Which companies offer this to small businesses?
3) Is it worth offering?
4) What kind of charges can I expect from the finanace company?

[ectect]

I would be inclined to give it a miss as I think you'd be opening a whole can of worms and may well be a lot more hassle than it's worth. A personal opinion as I haven't tried it, mind you. And I don't know what price range of goods you offer.

I would try to beat competitors with similar pricing on content, after sales, support, shipping etc whatever you can to get the customer confidence to purchase and return.

[christopher w]

How much is your average sale? Unless they are big ticket items (such as cars, furniture, etc) it usually doesn't make sense.

[bekyed]

Hmm,

You will have the expense of hiring a muscly debt collector I think.

Bek

[Phil_C]

No, the agency pay you, they deal with the customer.

[ddent]

eBay/PayPal has been working to offer this to US buyers on eBay through GE Capital.

[Automan Empire]

A company approached my bricks and mortar business offering a type of take now, pay later setup for any customer with a checking account. Upon close scrutiny, it turned out to be a variation on the payday-advance theme, the catch being that I, the merchant (NOT the customer), payed all the fees for the privelege of using this service. Look closely at any offers!
If you sell durable goods like refrigerators or cars, where there is some possibility of reposession in the event of nonpayment, a buy now, pay later program *might* work. Perishable, consumable, or intangible items like ebooks-forget it! Once received, what incentive for them to pay; what remains for you to reclaim?
Besides, why reinvent the wheel? There are several buy now, pay later programs, with names like Visa, Mastercard, etc. I notice that the only type of customers who even ask me to carry a balance are the type who never intend to pay, which probably explains why they don't have a credit card in their wallet.

[Rodney]

If you have a high ticket item (and depending on the company offering the "buy now, pay later" service), it can be very beneficial for the merchant.

My wife does this in her day job for a large international finance company, and basically the merchant doesn't have to do anything different.

They get paid up front, the customer can make a purchase right away, and the finance company handles all the payment, credit checks, and debt collection.

Sometimes the finance company actually pays incentives to merchants to use the service. So not only does it not cost the merchant anything, they can actually use it as an additional revenue area.