Eyewear Financing

[PAkev]

I recently received some information about an opportunity for folks to finance their eyewear with perks such as 0% interest and no payments for 6 months. I see pros and cons in offering this to our patients but don't have any experience to justify my decisions.

On the positive side of things I expect that we would get our money from the finance company up front. This will enable us to maintain a positive relationship with patients even if they should default or miss a payment. I would also expect it to provoke folks to spend more to increase our avg. sale; perhaps a second pair or premium options that their immediate budgeting demands can not support.

However, I would expect the finance companies discount rate to be fairly high in order to compensate for their risk. I'm not really sure if this is something we would aggressively advertise or only use it as a "go to" tool when patients ask us about a payment plan. Finally, I am concerned about compromising the image of our practice. Would offering a financing program convey the idea that our prices are high and therefore can not be afforded through otherwise conventional payment methods.

Helpful thoughts appreciated
Kevin

[aaron]

I walked past a Pearl Vision the other day and saw an advertisement for exactly what you just described. I have known of a few doctors to take advantage of this but most times they got in over their head. I don't believe that the finance company would give you the entire amount up front but I am not certain.

As for the image it projects... It is a little used car salesish... but if it is just offered as a service to provide patients with the vision they require now, then it could be uncompromising.

But the person that would end up financing eyewear, would they be the same person that would qualify for the 0% thing? Remember that finance companies make alot of money and not by offering 0% to everyone!


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[Texas Ranger]

I looked into a similar program that was through Essilor, but, even though it was 0% to the patient, it really was very expensive discount rate to us, much like how the charge cards charge your shop, right, you get your money right away, the pt pays no interest, but your money coming to you is "discounted' by the agreed on fee, which I believe was about 8%, so on a $200 sale, the pt would have 90 days say to pay the "card", at no interest, but you'd only get $184 deposited to your bank. not a bad deal if you think it's fair...

[chm2023]

http://lifestylechoicesplan.com/ecp_faq.html#Q8

Info on this.

[Chris Ryser]

Today you can buy furniture, cars, tools and appliances at Home Depot and so forth.

When you enquire how it works, the dealer say's that he gets the money right away and the finance company takes over if the customers credit qualifies. The seller is charged a slightly higher fee than regular credit card sales.

Car dealers will give no discount whatsoever if a zero interest deal is made, so the customer looses that way and pay's full list price.

i checked the above mentioned website and here is the punch line.

Option 2 - 6 Months "No Interest"
This is based on the same promotional principal as the 90 Day with the exact expectations at term, and the same opportunity to switch to a revolving credit card line. The minimum transaction is $299. On the "6 Months No Interest" option, the doctor discount is 6.9%.