[FUNd]

Can you give me an example buddy lol?

So the client is a restaurant, with 650 FICO, clean banks, no liens, no outstanding MCAs, no prior bankruptcies, no issues with their landlord, 3 years in business and doing $500,000 a year in sales. Prefers a quick turnaround of 6 months.

Broker A: Offers $30,000 on a 6 month payback, with a 1.35 factor as merchant cash advance from a company that is doing the underwriting process mainly by manual review which means the process will take longer.

Broker B: Offers $30,000 on a 6 month term, with a 1.18 as an alternative business loan from a company that has majority of the underwriting process automated so that the closing process takes about a day.

Can you give me an example of what Broker A is going to say, to convince said merchant to use him over Broker B? I agree with you that it's not just about pricing, it's about the entire scope of the deal, but what could Broker A possibly say to win this deal from Broker B?

No, you're right John. If it's an apples to apples comparison like that, then there is nothing that can really be said. However, if you have the relationship built and the rapport, the client should not be shopping you at all. They should believe you have the best deal in town demonstrated by your confidence and expertise, right? Like buying that new Lexus from a guy you really like. It's priced at $68,500, but there's one exactly the same across town, priced at only $65,000. You love the guy you're dealing with, the price of $68,500 isn't ridiculous and is within reason. You buy it, and never even bother to find the lower priced vehicle because you are comfortable and enjoying the process with your current salesperson.

[FUNd]

Fund, I LOVE your new signature line!

Thanks Zach, I knew you would.

[jotucker1983]

FUNd,

Yes, see the car example has the price in the same "range" and the car salesman could throw in some extra oil changes, tire rotations, etc. to even help even out the costs.

The issue within our industry (from my perspective) though, is that you have large broker houses who are spending a ton of money on marketing, thus, they have to remain very profitable on deals. So they will seek out 10 points on a deal or something similar.

So take that A paper client example I just provided, instead of pricing them at A paper, they price them like they are C paper so they can maintain their 10 point plus spread.

When the agent of that Broker house informs them that the merchant got the competing offer from Broker B, the Broker house will just "shame" the agent saying that if they are a quote, unquote "good salesman" then they should be able to "close", despite the fact that the offer isn't competitive and is significantly inferior to the competing offer.

I find a lot of sales companies operate like this, which is one of the main reasons why I decided to only participate in sales on an independent basis, so I'm not victim to insane practices like this lol.

[MCNetwork]

Can you give me an example buddy lol?

So the client is a restaurant, with 650 FICO, clean banks, no liens, no outstanding MCAs, no prior bankruptcies, no issues with their landlord, 3 years in business and doing $500,000 a year in sales. Prefers a quick turnaround of 6 months.

Broker A: Offers $30,000 on a 6 month payback, with a 1.35 factor as a merchant cash advance from a company that is doing the underwriting process mainly by manual review which means the process will take longer.

Broker B: Offers $30,000 on a 6 month term, with a 1.18 as an alternative business loan from a company that has majority of the underwriting process automated so that the closing process takes about a day.

Can you give me an example of what Broker A is going to say, to convince said merchant to use him over Broker B? I agree with you that it's not just about pricing, it's about the entire scope of the deal, but what could Broker A possibly say to win this deal from Broker B?

Haha a 17 point difference is a tough hurdle to overcome! Regardless, this is how I'd approach it. Keep in mind, that I'm going to throw in some assumptions about the various lenders that the brokers are dealing with in order to make this work

"So Mr. Merchant, I agree that my rate is much higher than my competitor's but let's take this into consideration. The funder I'm working with, XYZ Advance, is an up and coming company in the cash advance space. They fund over $15 million per month and they can go up to $500K per location. Your business is continuing to grow and when you get to the next level, this relationship will be valuable to you as you seek to expand. I've been working with them for 5 years and my clients couldn't be more thrilled with them. Their renewal policies are extremely flexible and you can get additional funds in as little as 60 days. In addition, I can provide you a generous prepayment schedule where you can save up to 50% on the cost of funds if you can pay this off within 90 days. Let's face it, you're entering your busy season so I think it would be beneficial for you to take advantage of this option.

Now my competitor, Goliath Funding, does have lower rates but here's the thing with them. They are a mostly automated shop, so if you have customer service issues you'll run into problems. You're just a number to them because they are the 2nd largest company in the industry. Not only that, they can't do more than $150K on an advance so when you grow you'll be capped at this level if you need more financing. Also, in order to renew with them, you have to be 50% paid down whereas with my guy, you only need to be 30% paid down. So in the end, I can get you more money, more often, with my funder than with Goliath Funding. Not only that, have you read the news lately? Goliath Funding went public not so long ago and their stock has been collapsing. I'm not sure that this is the long-term horse you want to bet on. My lender, XYZ Advance, is privately funded and financially strong. This is an impeccable company to get involved with.

Mr. Merchant, I ask you to look at the forest from the trees and work with me and XYZ Advance. I've been working tirelessly in financial services for over 10 years. I've build a reputation as being a hard worker and I fight for all of my clients. I work weekends and you can call me 24/7 if you have any issues. I'm here to build a long term relationship with you and your success is my success. I only ask that you give me this opportunity to show you what I can do for you. So let's start this relationship and turn your company into a $2 million business within 4 years!"

[FUNd]

Quote Originally Posted by aprilb

All MCA and small business lenders we are generating over 100 warm leads per day for MCA and small business funding. These are generated from our call center and come with the recording to validate validity. I'm looking for solid buyers. We offer a guarantee on bad leads. Please email me at benosaapril17@gmail.com

Got this garbage in my inbox just now...ADMIN, want to ban this scammer for all of us??? Thanks.

[jotucker1983]

FUNd, I just got the same thing lol.

I get emails like this all of the time too, they are always from some Gmail address, probably because people complain a lot and they are trying to filter off those who appear "interested" before revealing who the company actually is.

Whether they know it or not, that practice violates Can-Spam.

[jotucker1983]

MCN,

That's a great post lol, and I would actually do the same with the MCA product in terms of explaining the long term aspects of the reload feature which doesn't have a "paying interest on top of interest" aspect to it, which can be similar to a credit line's functionality.

I would just focus on providing the full solution to the merchant in terms of quality, price and support, not just quality and support.

Quality: This is in relation to getting to the approval amounts noted and providing good options in payback cycle from 6 - 18 months. If it's an alternative loan, explain how the loan can work to build their business credit, if it's an MCA, explain the reload feature going forward which would have the product operating similar to a credit line.

Price: If it's A Paper, price it in A Paper range, which is 1.12 - 1.20 for 6 months, and 1.25 - 1.30 for 12 months.

Support: Discuss your years in business and professional competency, online statements, support team, recommendations on getting them out of the alternative products and into conventional ones, etc.

A lot of these large broker houses seem to focus on getting 10 - 15 points by pricing A Paper like C Paper, they better hope I don't run across that merchant lol.

I will provide the same (or even in some cases higher levels of) quality and support functions, but I would give the merchant "proper pricing" based on its marketplace standing.

I wouldn't price a Restaurant Merchant Account with a 100 BP mark-up, and I wouldn't price an A Paper Restaurant with C Paper pricing on the funding side, not because I'm just competing on "price", but because that's not the proper pricing for that deal based on marketplace standing.

[John Galt]

Or at least "perceived value".

[admin]

Quote Originally Posted by aprilb

All MCA and small business lenders we are generating over 100 warm leads per day for MCA and small business funding. These are generated from our call center and come with the recording to validate validity. I'm looking for solid buyers. We offer a guarantee on bad leads. Please email me at benosaapril17@gmail.com

Got this garbage in my inbox just now...ADMIN, want to ban this scammer for all of us??? Thanks.

Thanks for reporting FUNd. This user has been banned. Please note that similar rules for soliciting apply to private messages. All users should beware of uninvited solicitations through the private message system, especially ones using free email addresses.

[AndyYSCISOdept]

MCN,

That's a great post lol, and I would actually do the same with the MCA product in terms of explaining the long term aspects of the reload feature which doesn't have a "paying interest on top of interest" aspect to it, which can be similar to a credit line's functionality.

I would just focus on providing the full solution to the merchant in terms of quality, price and support, not just quality and support.

Quality: This is in relation to getting to the approval amounts noted and providing good options in payback cycle from 6 - 18 months. If it's an alternative loan, explain how the loan can work to build their business credit, if it's an MCA, explain the reload feature going forward which would have the product operating similar to a credit line.

Price: If it's A Paper, price it in A Paper range, which is 1.12 - 1.20 for 6 months, and 1.25 - 1.30 for 12 months.

Support: Discuss your years in business and professional competency, online statements, support team, recommendations on getting them out of the alternative products and into conventional ones, etc.

A lot of these large broker houses seem to focus on getting 10 - 15 points by pricing A Paper like C Paper, they better hope I don't run across that merchant lol.

I will provide the same (or even in some cases higher levels of) quality and support functions, but I would give the merchant "proper pricing" based on its marketplace standing.

I wouldn't price a Restaurant Merchant Account with a 100 BP mark-up, and I wouldn't price an A Paper Restaurant with C Paper pricing on the funding side, not because I'm just competing on "price", but because that's not the proper pricing for that deal based on marketplace standing.

These are great points, would you mind if I printed them out and gave it to a few of the newbies here?

[anonymous]

Can you give me an example buddy lol?

So the client is a restaurant, with 650 FICO, clean banks, no liens, no outstanding MCAs, no prior bankruptcies, no issues with their landlord, 3 years in business and doing $500,000 a year in sales. Prefers a quick turnaround of 6 months.

Broker A: Offers $30,000 on a 6 month payback, with a 1.35 factor as a merchant cash advance from a company that is doing the underwriting process mainly by manual review which means the process will take longer.

Broker B: Offers $30,000 on a 6 month term, with a 1.18 as an alternative business loan from a company that has majority of the underwriting process automated so that the closing process takes about a day.

Can you give me an example of what Broker A is going to say, to convince said merchant to use him over Broker B? I agree with you that it's not just about pricing, it's about the entire scope of the deal, but what could Broker A possibly say to win this deal from Broker B?

Broker A will be selling the dream, rather than the product. Happens every day. A good salesman can close an inferior deal, have seen it done many times, and have even done it myself once or twice.

[jotucker1983]

These are great points, would you mind if I printed them out and gave it to a few of the newbies here?

Sure , maybe you could just link it back to this thread or just reference me in the material?

Broker A will be selling the dream, rather than the product. Happens every day. A good salesman can close an inferior deal, have seen it done many times, and have even done it myself once or twice.

Give me an example? I've heard this before and this mantra is common place amongst Sales Managers, but in my opinion it just doesn't make any sense.

What are the value point arguments (that matter to the merchant) that you are going to say to convince them to pay $5,100 more with you than with the competing offer with Broker B?

If I were Broker A and had literally no choice in the matter, I would probe to see if there are origination fees on the table, probe to see if that's the "final offer" or a teaser rate, as well as explain the long-term planning aspects in terms of reloads as the competing offer will more than likely have them paying "interest on top of interest" during renewals. But what if the merchant doesn't want to use this for the long term? What if they are just looking at doing this for 6 months and that's it?

But thank goodness I'm not Broker A lol, the pricing for that deal in the example isn't efficient considering it's an A Paper deal. It's bad pricing and the only way that merchant is getting closed is if they don't shop, don't get another call from a competitor, and/or are already within the process with you with a "rush" to get some type of funding (thus they don't have time to restart the process with someone else).

[AndyYSCISOdept]

John, Im not super tech savvy so if you can PM me how to just tie it back to this thread Id be more than happy to...I just would really like the people I work with to gain the knowledge I am privy to on a regular basis

[Zach]

Broker A will be selling the dream, rather than the product. Happens every day. A good salesman can close an inferior deal, have seen it done many times, and have even done it myself once or twice.

Anonymous, I love your signature

[anonymous]

Give me an example? I've heard this before and this mantra is common place amongst Sales Managers, but in my opinion it just doesn't make any sense.

#1. 3rd or 4th position deal last month, similar offers between us and the competing lender (direct), they just beat us out by 6 points (1.34 against 1.40). Caught him on the phone while signing and gave a few horror stories about the lender he was signing with - had him sign ours instead, funded.

#2. Couple people on the board might be familiar with this one. Late AUG, manufacturing, texas. Competed with several brokers with this one. He had a questionable first and BLOC in place. First broker had a strong second offer (much better than my consolidation deal in all reality), told him another payment would kill his cash flow, made a realistic case, had him sign the consolidation. Lender pulled the deal, competing brokers exclusivity (30 day) ran out (after I thought the deal was deal on our end), lender contacted me with the offer, and I closed him on that same second within about 15min (after preaching how it would "kill cashflow, and he apparently had another consolidation offer on table at that time). Switched the pitch to annualized rate and long-term outlook. $150K, funded.

Every deal has it's own benefits (inferior or not). Find and exploit those benefits (no matter how irrelevant they may seem). Just a couple examples, have many more if you'd like.

[jotucker1983]

Sorry I know I'm late responding to this lol.

#1. 3rd or 4th position deal last month, similar offers between us and the competing lender (direct), they just beat us out by 6 points (1.34 against 1.40). Caught him on the phone while signing and gave a few horror stories about the lender he was signing with - had him sign ours instead, funded.

Remember you said you were going to provide an example of selling an inferior product?

If the competing lender was really "bad" as you say they were, then how would your product be inferior? The competing lender could very well have been providing a teaser rate that would have changed once "closing" started.

Just hope that the lender in question was really as bad as you made them out to be, I don't really use the tactics of bashing my competitors to make my product look better, I just focus on product comparisons.

As for the example with the consolidation/2nd position, again, how is this an example of selling someone an inferior product? The merchant had a choice between a 2nd or the consolidation, really depends on which direction he preferred, but neither are superior to the other, both are bad situations to be in quite honestly.

- The 2nd would add to cashflow issues by taking a higher percentage of his gross.

- The consolidation would have him paying "interest on top of interest" or paying off the same balance(s) twice.

Neither option is superior to the other, the merchant is in a bad situation and has to pick either slicing off his foot or his hand.

Every deal has it's own benefits (inferior or not). Find and exploit those benefits (no matter how irrelevant they may seem). Just a couple examples, have many more if you'd like.

100% agree, my point is that sometimes you have a deal that does not compete with other offers that the merchant has, and there's no "true and factual" value statements that you can provide to make your deal better than the other.

This doesn't mean you can't still win the merchant though, a lot of times you can win by simple fact that you already have them started with the process and are nearing the end, with the merchant not wanting to start the entire thing over again with another Broker.

I try to be 100% honest with merchants, if another deal is beating mine and I can't match it in terms of quality or price or something else that matters, then it's a better offer. But at the same time, I rarely run into this because like I said, I focus on providing the full solution and properly pricing merchants in the first place. I don't seek 10 points per deal.

[anonymous]

Fairly certain you are one of the very few people on this forum who see it that way, there is no pleasing you lol. Also could have summarized the response.

[Zach]

10,000 views! That's a lot of sales advice being spread out. Please... no more bad cold calls... Hit me with some rebuttals guys!

[AndyYSCISOdept]

Congratulations on the view count. Keep it up.

[RogueLender]

Favorite Sales line "Hey, how many phone calls have you received today from people in New York that you can't understand promising you the world"??

[AndyYSCISOdept]

And how does that usually end up?

[anydealfunded]

Hahaha rogue lender...I'm sure that actually works. Sometime being from New York can have a negative connotation attached to it.

[AndyYSCISOdept]

I actually have some insight into this as someone who was born and raised on the west coast but moved to Manhattan in my early 20's...
I rolled into NYC and was awe struck at how fast every spoke and sometime felt like I needed subtitles to understand, that and I always felt like people from NYC were trying to pull a fast one on me.

But 8 years later, its the greatest city on earth.

[dailyPLUNDR]

Interesting scenario i ran into today, wondering how you pro's would handle it. So Mr. merchant tells me he is doing 20k/month and has credit around a 530 looking for 60k. He tells me he's looking for 13k (reasonable request) to expand his cleaning service, the rest is to pay off company vehicles and a family member. As i start to ball park the amount of money we could put together (10-15k) in reference to what he told me he was looking to accomplish with the 13k, he informed me he has an offer from Rapid for 52k, on a 12 month term at a 12% interest rate. Everything i know tells me this is not possible but as i am communicating this to the merchant he insists that he has the offer in hand. Is this just another sales rep trying to keep him from shopping with (unrealistic) projections? Is there some unique advance product offered by Rapid that can realistically make this offer? Any suggestions for handling this type of objection in the future? Thanks for any insights

[Zach]

Interesting scenario i ran into today, wondering how you pro's would handle it. So Mr. merchant tells me he is doing 20k/month and has credit around a 530 looking for 60k. He tells me he's looking for 13k (reasonable request) to expand his cleaning service, the rest is to pay off company vehicles and a family member. As i start to ball park the amount of money we could put together (10-15k) in reference to what he told me he was looking to accomplish with the 13k, he informed me he has an offer from Rapid for 52k, on a 12 month term at a 12% interest rate. Everything i know tells me this is not possible but as i am communicating this to the merchant he insists that he has the offer in hand. Is this just another sales rep trying to keep him from shopping with (unrealistic) projections? Is there some unique advance product offered by Rapid that can realistically make this offer? Any suggestions for handling this type of objection in the future? Thanks for any insights

It was probably a 12% holdback, and a preliminary offer (the payment is too low to be 12% holdback for 52K -- it isn't likely that it will actually fund).