Answer these three questions:
- If you’re a trailer manufacturer or a truck body builder, do you extend credit to any of your dealers?
- If you had the ability to extend credit to your dealers, is that be something you would do?
- Would it help you compete with other manufacturers that do extend credit to their dealers?
Whether you said yes or no to these questions, extending credit is a great way to grow your manufacturing operations.
I’ve worked with a lot of truck dealers and a lot of different trailer dealers and one of the things that I have observed is that large companies offer terms. They may be providing $100,000 worth of trucks or trailers, or $200,000 worth of trucks and trailers for 30 days, same as cash or 60 days, same as cash to their dealers. It’s a powerful tool that can put a smaller manufacturer at a really big disadvantage if you’re only cash on delivery.
I understand why you want prepay and why you want COD. You want to make sure that you get your money! But what if you could offer those terms to a dealer and not take on any of the risk? In fact, you can probably get the dealer to pay for the privilege of having those terms.
There is something that few people talk about in the truck body and in the trailer manufacturing industries. There’s a product called Trade Credit Insurance and if you are not offering terms, I think it could be a huge help to you. It could be the tool that you use to grow. It could be the tool that you use to underwrite your dealers and make sure they have the financial capacity to pay you. And if for some reason they don’t pay you, there’s built-in protection for your bottom line.
If you are losing dealers to your competitors and are interested in offering terms, let’s discuss your situation. You can use the button below to schedule a call or call us direct at (478) 449-5928.