Successful roofing companies regularly provide their sales teams with valuable marketing tools and training to close more sales. One of the key tools the team should have in their arsenal is the ability to offer flexible payment options to their customers. Payment options provide convenience and flexibility to homeowners, especially with a purchase of this size.

Offering payment options is especially beneficial to contractors who want to transition from more insurance restoration or emergency projects to more profitable and planned roofing or siding projects homeowners require after years of wear and tear, when roofs are nearing end-of-life but may still have some time left.

According to Dave MacLean, senior vice president of Brothers Services in Maryland, they’ve been increasing their sales and the amount they finance every single year.

“Six years ago, we were financing only 5% of our business. Within the first year, we’d gone up to 20%, a night-and-day difference," said MacLean. "And in that same year, we realized a 26% annual growth rate. And in the last five years, we’ve seen a 17% compound growth rate, all of which has been fueled in large part by flexible payment options.”

A potential Brothers Services client knew he needed to replace his roof after years of hailstorms had taken their toll. Like most homeowners, he didn’t have a roof-replacement fund saved up, and with the average price of a roof at $12,000, he was concerned.

“Assuming he’d need to finance in some way, we went through our typical list of questions: ‘Is this an expense you planned for?’ After the expected ‘no’ response, our sales team asked the question we’d trained them to ask: What do you plan to do when the cost of the project exceeds your budget? Most haven’t thought about it," MacLean said.

Seizing the opportunity, the sales rep explained that the company has a 12-month same-as-cash loan. This type of loan allowed the customer to upgrade his roof with a 50-year warranty and pay off the balance when he received his annual bonus. Without the same-as-cash option, Brothers Services might not have closed on the upgrade — or possibly lost the whole sale to a competitor who offered payment options.

“While some still believe ‘cash is king,’ or feel embarrassed that they don’t have cash on hand for a project like this, smart money people will always use someone else’s money for as long as they can if it doesn’t cost them more to do it,” MacLean said. “If 12-month same-as-cash is an option, I’ll take same-as-cash, and I’ll pay it off before the same-as-cash period ends.”

How Offering Payment Options Helps

Enabling contractors to offer customers a choice of payment options — such as a choice between a same-as-cash loan and a low monthly payment loan — can allow homeowners to install the best possible roofing for their home faster and easier. In addition to helping the homeowner, financing options can benefit your contractor’s business in three key ways:

• Competitive advantage: Today, differentiating your company to win more business takes more than a great reputation and excellent customer service. If contractors can offer a choice of payment options that are easy to apply for and obtainable for most homeowners with decent credit, they have an advantage over competitors who might accept only cash or credit.
• Upselling opportunity: A homeowner living with a roof ready to collapse probably needs to replace their roof sooner rather than later, and they’re likely to move forward with the project if they’re not limited in how to pay. Even better for the contractor, if the homeowner has the funds to pay for a new roof, they might decide they want an extended warranty or that they also want new siding, higher-end exterior windows or even exterior paint to improve the overall look of the home. Offering a choice of a same-as-cash loan and low monthly payment loan can make those larger projects more doable. According to MacLean, an average roofing contract without financing is $12,909, but an average financed contract is $17,796. “We aren’t just a roofer but a full-service remodeler, and in the exterior world, we track contracts per customer. If you call us to buy a roof, and I sell you a roof, it’s one for one. If I sell you a roof and gutters, it’s a two for one. Our average contracts per customer went from 1.2 contracts per customer to 1.4 contracts per customer.”
• Repeat business and referrals: Satisfied customers come back for more. Being able to finance a new roof or a more extensive exterior project easily would make any homeowner happy — especially if they:
  • Have the money, but don’t want to use their savings or investments for this purpose;
  • Don’t have the full amount saved up;
  • Don’t want to pay with high-interest credit cards;
  • Don’t want the hassles that come with a home equity line of credit, including the paperwork, long approval time, and collateral requirement.

Also, if the contractor offers them a positive overall experience and installs quality materials, they'll likely come back to the contractor when they have another project — and refer friends and family.

How to Ask about Financing to Increase Sales

Talking about money is a skill. It rarely comes naturally and must be learned. When you’ve mastered asking money-related questions in the right way, you’ll succeed in most business environments. Not only do sales reps need to make sure their customers know about the payment options, but contractors also need to have it on their website and mention it any chance they have, including when they set up appointments. Before hanging up, your appointment setter should plant the seed: “Don’t forget to ask our sales rep about our ‘no payment/no interest’ options available until the end of the month.”

“Introduce a choice of financing options with all prospects when you set the sales appointment, build rapport at the beginning of the appointment at the customer’s home, and when you present the estimate,” said MacLean. “Then they can choose what works best for them to get the job done and can even plan more improvements they hadn’t thought possible.”

Assume the customer will finance the project. As MacLean mentioned previously, they need to ask whether they’ve set aside budget for the project. Some will say yes because they are proud, as if not having money for this unplanned expense makes them poor.

“They still think ‘cash is king,’ but it really isn’t. We don’t charge more for financing,” MacLean said.

Some may say, “I haven’t figured out how I’ll pay for this project.” The sales rep should respond by saying: “We have some amazing payment options we can discuss that will help.” This response starts the thought process that there are different payment options available. When the project plan is finalized, they can talk to them about various payment plans. For example: “The project estimate is $19,000. To start work, we require one-half down and the remainder at completion. Many customers choose either a low monthly payment option or Same-As-Cash.”

It’s all about making it easy for the customer to buy, so the sales reps need to ask the right questions in the right way. To increase your average order size, the contractor must look closely at what’s really happening with customer communication. If there’s an issue of asking the financing question, or the right question, or the question in the right way, learn the best practices and then fix it. That’s the way a contractor can use the simple method of offering payment options to increase sales — a win-win for the homeowner and the contractor.