Body shops often handle substantial damage to the vehicles their clients bring in, which usually comes with a hefty bill. While insurance companies help consumers cover repairs like these, the cost can still become a significant obstacle to many consumers getting the body repairs they need. As a result, many drivers end up living with potentially unsafe damage to their vehicle instead of getting the work done simply because they can’t afford to pay.

Luckily, there are consumer financing platforms that body shops can adopt to help their clients break up a repair bill into more manageable payments. This can lead to more consumers being willing to get necessary work done and more likely to accept purely cosmetic repairs to get their car looking as new as possible.

To help mechanics offer body shop financing, we are going to cover:

• The benefits of body shop financing
• What financing options make sense for body shops
• How to offer auto repair financing

The Benefits of Body Shop Financing

The value of consumer financing to clients is obvious. The question is, though, what value does it bring to the body shops that finance? There are several, and they help body shop owners bring in more money and help more clients.

These benefits include:

• Appealing to a broader customer base by capturing those that need financing
• More repeat business
• Higher customer satisfaction
• Higher likelihood that clients will accept all necessary repairs
• Fast and simple payment process

Not only do these benefits make more money for the shop directly, but they also have a significant impact on referrals and reviews. As any service-based business owner knows, these are the two most cost-effective ways to grow, as happy clients end up doing the leg work of advertising the business to locals that are likely to patronize it.

What Financing Options Make Sense for Body Shops

To get the most out of their financing offers, body shop owners should ensure that they offer the right payment options. Financing is a widely adopted tool that consumers seem to love, but the specific way they get their purchases financed varies based on the industry.

For body shop financing, we recommend offering:

• Buy now, pay later (BNPL)
• Credit Cards
• Personal Loans

We’ve placed these in order, with BNPL being the most useful for every consumer and personal loans being the most case-by-case option. So let’s dive into each and the situations in which they are best utilized.

BNPL

BNPL payment plans are similar to loans, but they often don’t charge interest for short-term plans, and they charge lower interest on longer plans than a traditional loan. They also don’t report to credit bureaus as long as payments are made on time, meaning they will not affect a consumer’s credit. Additionally, by partnering with a fintech firm that uses soft credit checks, mechanics can ensure that even the application never negatively affects a customer’s score.

BNPL should always be the first offer to any client. They can be made to work for any size repair bill, and they eliminate many of the drawbacks that keep consumers from utilizing financing.

Credit Cards

Another common financing offer for body shops is a branded credit card. These cards typically offer reduced interest rates for the first purchase made with the business that provides it, giving consumers more flexibility regarding when they pay off the bill. Many consumers prefer a more fluid payment structure as opposed to a payment plan or loan with fixed payment dates and amounts.

Since credit cards provide a permanent line of credit, they are best used when a client has a consistent need for repairs. This could be because they have an expensive car, multiple family cars, or they run a business that requires an entire fleet of vehicles. Credit cards work well in these cases because it only takes a single application to get access to financing every time they walk into the shop.

Personal Loans

Personal loans should be reserved for the most complex type of repairs or upgrades where consumers may need longer to pay. Other consumers may not qualify for a BNPL body shop financing plan due to a low credit score or needing the bill broken up into too many payments. For these reasons, body shops should always have the ability to offer a personal loan to their customers.

Offer Body Shop Financing With Skeps

Skeps offers a comprehensive, end-to-end consumer financing program that helps businesses modernize their entire payment process. We go above and beyond one-click payment, also offering a one-click application process for several different types of consumer financing, including:

• BNPL
• Store credit cards
• Consumer loans and leases

If you’re looking to partner with a forward-thinking fintech company that will keep consumers' eyes on the purchase while offering best-in-class financing, Skeps is the perfect fit.