Alternative business financing can help owners expand their inventories, and for businesses that sell larger, high-dollar items, now might be the ideal time to explore this option.
A recent study from Synchrony Financial found 4 in 10 shoppers are willing to make a purchase of $500 or more within the next 12 months – an increase of 33 percent from the previous year. Meanwhile, businesses that offer store credit or financing are also in luck, as a quarter of those surveyed said they are open to using these means as a way to afford a major purchase, up 12 percent from last year.
These findings will be especially important to small business owners who use online channels for sales.
“For the third consecutive year, our Major Purchase Consumer Study has tracked the importance of digital tools for research, and these latest findings confirm more consumers and omni-channel shoppers are now purchasing bigger ticket items online,” Toni White, chief marketing officer of Synchrony Financial, stated in a press release. “At the same time, related opportunities emerged to increase consumer satisfaction with retailer websites and the reliability of online reviews as well as the visibility of promotions and financing options – considerations for retailers as they focus on providing the best shopping experience.”
Shoppers’ willingness to spend more on big-ticket items could be attributed to rising consumer confidence. Recent data from Thomson Reuters and the University of Michigan showed U.S. consumer sentiment reached its highest level in more than seven years during October, with more Americans showing positive sentiment in regard to personal finances and the overall economy.
Consumers shop around
Another finding from Synchrony Financial’s 2014 Major Purchase Consumer Study was that shoppers tend to visit multiple retailers before making a final purchase decision. In fact, on average, major purchase shoppers visited four unique retailers.
This shows that small businesses have to devote time, energy and money to marketing efforts in order to compete with similar merchants.
Small business loans can help retailers put marketing campaigns into action, as well as help owners expand their inventory of larger, more expensive items, including everything from TVs and stereos to household appliances.