Home Exterior Systems ( HES ) quotations almost always lead with a cash discounted price because it saves our customers money, and over 90% take advantage of it. So, why doesn’t HES push financing and credit cards during the sales process? Simple: we’re trying to keep your prices low as possible. Read on to see why HES quotes cash discounted price for home exterior projects.
Credit Adds Unavoidable Cost
Lower prices begin with controlling our costs, including credit costs. Credit costs us as much as six percent, which is a lot on a $25,000 project. And that six percent cost adds zero value to your finished siding, windows, roofing, or patio project.
Sometimes Financing Home Improvement Is Best When Waiting Isn’t An Option
Sometimes a homeowner should use financing for a required home repair (water leak or rotted structure) because waiting will only make the problem worse. Financing a problem-driven job is a much better alternative than waiting, no question about it.
Credit Fees Must Be Made Up, So Price Must Increase To Offset Them
This information is not news for many of our homeowner customers. However, many homeowners don’t realize that paying with a credit card adds cost to the seller. That cost may range anywhere from two to six percent or more in some cases. The buyer cardholder may accumulate points and cashback rewards, but the seller pays in the end.
Credit Buyer Beware Of Cut Corners!
Small businesses must adjust for that added finance /credit cost in their pricing, or critical profitability suffers. Invariably, companies must build that cost back into their products and services pricing, or they must cut corners elsewhere to make up the difference. Rather than increase prices, lean companies that have already improved operating efficiency may instead choose to “cut corners’ by using lower-quality people or materials, which results in inferior renovation results and a shorter overall lifespan.
Cash vs Credit Transparency
“Home Exterior Systems works hard to keep costs as low as possible while using the highest quality materials and the best installers around,” says Pat McCollim, co-owner of HES. “This is incredibly challenging post-COVID while building materials availability is severely constrained, and inflation is on a record upward curve. Many homeowners have no idea about the added cost to the contractor offering prearranged financing. For us to secure financing adds a percentage of the total cost to the final price of a job.”
Many Contractors Don’t Differentiate Cash vs Credit
Most exterior and remodeling contractors we talk with at trade conferences tend to lead with financing right upfront during the sales call and build the added financing or credit card costs right into their pricing. Some even mark it up. They profit from financing.
HES Credit Policy Is Unique
It surprises us that many contractors don’t bother with discounts for paying by cash, check, or bank transfer and charge you the marked-up “credit” price. These same contractors tell us we’re leaving money on the table by not employing this practice. Perhaps that’s true. Exactly why HES quotes cash discounted price for home exterior projects is to pass along the savings.
If We Didn’t Earn it, We Don’t Charge For It
We have a problem getting a bill for marked-up, unearned, fees and we believe our customers agree. “Our policy has always been to make a fair profit for the real work we do and for the actual expenses we incur to complete a job the right way, says Pat. We are not in this business to compete on price; nobody wins competing on price in the contracting industry. We are in business to provide great exterior products using the best installers and guarantee our work. However, to be sustainable for decades to come, HES must profit. However, making a profit doesn’t mean blindly doing what others do or charging money for anything we didn’t earn. Ethics matter at Home Exterior Systems.”
