Defining the issues
January 25, 2017,
HIGH POINT — What do financial-services providers see as the most important issues in the 2017 when it comes to serving their retail clientele?
Kevin Lawrence, Versatile Credit
David Weyher is chairman and founder of Lendpro, which partners with various financing and Lease-to-own providers to offer retailers a range of options across a range of credit-requirement levels. He pointed out that retailers’ lending options continue to evolve and fluctuate, which he sees as a benefit.
Long-term, no-interest programs are often scaling back, he noted, adding that in the LTO space, “we’re seeing changing terms for 90 days vs. same as cash.
“We work with all sizes of retailers,” he said. “The underwriting by the lenders for the smaller retailers seems to have decreased lately as far as who’ll they approve and work with. Lendpro works with several lenders in each category to protect our retailers from those changes in the marketplace.”
“We need to focus on understanding what it’s like to be a retailer,” said Crest Financial CEO Bob Millerberg. “It’s too easy to brush aside the retailer’s day-to-day business challenges that go beyond the (lease-to-own) solution we provide.”
Becoming first choice
Kevin Lawrence, vice president of sales and marketing at Versatile Credit, believes finance companies must guard against becoming commodity providers, especially with the increasingly competitive no-credit-required market.
“What we’re hearing from our customers is that they have any number of choices when it comes to financing,” he said. “One thing the prime lenders do very well is bringing services over and beyond their service — analytics, customer profiles.
“Everyone on our end wants to do business with the same retailers, and the question is how do we become the first choice? Is there something we can bring to the table that helps them understand the no-credit-required market?”
Mark Olson, vice president of marketing and field sales development at Progressive Leasing, said the most important thing facing the industry is the continuing education process of merchant partners and their retail sales associates.
“Credit-challenged customers walk into every store in this industry,” Olson said. “If the need exists and a solution isn’t offered, both the retailer and the consumer lose.”
At LTO provider AcceptanceNow, Stephen Mckinley, vice president of sales and client relations, foresees technology enhancements continuing to add value to the retailer and customer experience.
“With that said, what we have found and what the retailer continues to tell us is that no technology replaces the personal touch of human interaction between the customer and payment options that are offered by the retailer,” McKinley said. “AcceptanceNow’s staffed model remains our focus and commitment to drive incremental revenue for our retail partners.
“We are working on a number of fronts to improve the AcceptanceNow employee experience within each of our retail partners, which will ultimately pay additional dividends to the retailer and overall customer experience.”
From a company perspective, Fortiva CEO Jeff Howard feels very good about its offering to clients — making sure customers can be approved online or in the store to make for a seamless process.
“Seamlessness needs to exist not only with the in-store process, but also with the online process,” Howard said. “We have the infrastructure and technological flexibility to transition from online to in-store through both point-of-sale and web integrations. … We see this as ‘version 2’ of that focus on creating a seamless process.”
Meeting retailers’ expectations regarding customer experience is the top issue at Zibby. “Customer loyalty is critical for our retailers, and we are constantly looking for ways to increase engagement and loyalty to our retailer’s brand,” said Tony Cerino, director of sales.
TD Bank’s retail card services is among the more traditional finance-servicing sources for retailers, and Mike Rittler, who heads up that end of TD Bank, acknowledged the increasingly competitive environment created by secondary and no-credit-needed providers. “We look at two ends — first, our retail partners. If we can’t serve them, we don’t have end customers,” Rittler said. “What’s important to them is flexibility; it has to be a frictionless process (for their customers). The last thing you need is for the credit application to interrupt the sale.
“On the end-customer side, we’re looking for options. Some (consumers) want an equal payment, while some want a minimum due for a time. We try to make sure our retail partners understand the value of both plans.”
David Minero, national sales manager for Tidewater Finance Co., pointed out that consumers in the secondary space routinely face life events that can impact their monthly cash flow. “Navigating those events in conjunction with the customer is crucial to continuously serving the retailers that provide those customers products and services,” he said.
Ways to maximize
With a lot of newcomers in the market, especially in the lease-toown space, retailers need to be wary, said Tempoe Senior Vice President of Sales J.R. Zirkelbach. “Our clients demand and deserve best-in-class service — which can be provided by just about any company initially or intermittently. … Sustaining performance like this is certainly challenging and requires continual business evolution,” he said.
Genesis launched its first second-look financing program five years ago with the goal of offering a prime-credit experience for nonprime credit customers and the retailers that serve them.
“It is important that we continue to provide lending to our retailers in the ways that help them maximize sales,” said Bruce Weinstein, CEO of Genesis Financial Solutions. “That includes making sure we can serve customers online; both providing instant credit decisions and using our cards online, while we continue to provide excellent service in store.
“Another important issue is to ensure that we are able to maintain our credit coverage for our retailers, regardless of what the market throws at us. We need to stay on top of fraud, macroeconomic and demographic shifts so that we remain a stable and constant resource.”