Why You Shouldn't Discount the Price of Your Equipment

Discounting the equipment you sell can be a big mistake. Good News. You don’t have to.

If you are like most equipment dealers and manufacturers, you are less certain about 2024 than you have been about any previous year you can remember. But discounting the prices of what you are selling can be a big mistake and you don’t need to do it.

1. Destroying the perceived value of the equipment you sell. If you have your equipment listed at $75,000 but you sell it for $60,000 enough times, your customers and the market in general will no longer believe your equipment is worth your asking price. The good news is that you don’t need to provide cash discounts much, if at all.

2. You can grow sales without providing a cash discount on your equipment. When sales start to decline, the first thing equipment sellers consider is discounting the price of their equipment. That can be a big mistake when that discount doesn’t result in more sales. Who wants to sell less equipment with less profit in each sale? Instead, consider using the discount you were considering to enhance a finance program. This can result in you having a great marketing tool to potentially grow sales, created by changing the way you provide the discount you were already going to give to your customers. Example: you were thinking that to sell the 200 units you sold last year you were going to average a 12.5% discount this year because there is less demand. If you put that 12.5% into a finance program, you can sell the equipment for asking price and advertise “rates as low as 0%” or “payments starting at 1,379 a month.” As a result of using the discount you were already prepared to offer as an addition to a finance program, you can advertise a significantly lower monthly payment and 0% finance option. So, you can sell the equipment at asking price and potentially grow sales through atractive monthly payment and finance rate options.

You are not alone. 2024 might be a tough year for thousands of businesses owners. But if you focus on creative ways to grow interest and sales, it will result in you being more confident about the future and beter positioned to invest in the future of your business when things get beter.

Contact American Bank Equipment Finance today to learn how we can help your business!