Dear Broker, here are your updates for this week...

M a r k e t i n g  t i p
Avoiding a negative is often the biggest positive

People naturally don't like to lose what they already have. Studies overwhelmingly show that people are much more likely to try to avoid losing what they have than try to gain something of equal value. Shifting your message slightly from focusing on a gain to focusing on avoiding a loss can make your communications much more effective.

If you have your personal automobile serviced by one of the national chains, you have probably already experienced this sales tactic. They are experts at it. Having your transmission fluid replaced at the same time as having your oil changed saves time. Regular servicing of your transmission also makes your car safer as it helps prevent you being stranded in the middle of a busy intersection or on a dark country road. But the most effective way to convince you that you should have your transmission serviced? Tell you what you stand to lose if you don't. Replacing your existing transmission can cost you thousands of dollars. In this case the benefit of the service is not a gain but rather the avoidance of a negative. More often than not, the avoiding losing something is more convincing than the opportunity for gaining a positive.

Lease brokers can put this simple tactic to use in a number of ways. First, identify what is scarce or time-sensitive. Those are the items that are at the most risk of being "lost" by your applicant. For instance, has the customer chosen the one piece of equipment in the dealer's inventory that suits his or her needs? Are you the only company that offered the customer an approval? Does the customer have the opportunity to win a profitable contract? Next, position the financing product that you are offering as the way to avoid losing or missing out on the scarce item(s). Of course, the financing you are offering might be the thing that is scarce - approvals expire, rates change, promotions end, etc.

To use a situation familiar to us, let's look at a transaction with an asset from Trucks at Hand and financing from SunBridge Capital. There are several elements that are likely to be scarce: the availability of the asset (because they move quickly and are limited in quantity), the terms of the financing (because they are very generous for challenged credits), and potentially the promotional offer (which expires). Each of these can be used to motivate the customer to take action, because he or she does not want to miss the opportunity. So instead of saying "this is a great truck for you - it has the specs you said you wanted," you can say "let's hurry up and put a hold on this truck because this is the only one like it." Or instead of saying "this is great financing with only one payment due up-front," you can say "financing with only one payment due up-front is hard to find for your credit situation, so let's act before the approval expires or the truck is sold to someone else."

Look for opportunities to turn avoiding a negative into a selling benefit. Whether it is the customer's affinity for a particular asset or a customer's desire to seize a profitable opportunity, the potential for losing out on a positive is a powerful motivator.

S a m p l e  d e a l  o f  t h e  w e e k
Start-up company obtains excavator and financing with only first payment due up-front