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How to double Internet sales through credit leverage

What’s a fundamental difference between buying goods at an electronics store and at an online shop? The difference is customer motivation. A “learned” customer comes to an offline electronics store, examines closely a required thing, then visits a website to buy it at a far lower price.

Today, more and more Ukrainians prefer purchasing home appliances and other durable products in eshops. However, the case is that if the price exceeds 2-3 thousand hryvnias, the circle of prospects ready to purchase something right now shrinks abruptly. So a user attracted to a website with effort either lays aside the purchase of a needed thing or comes back at the electronics store as a customer can be granted a loan there. Sure, the customer pays more at an electronics shop as compared with an Internet shop as he buys on credit, but he is ready to accept that financial loss.

At the entrance to nearly any electronics store, there’s a row of tables seated by credit establishment employees aching to grant a missing amount to a prospect. Thus, large offline stores get a chance to leave behind web business in the struggle for average-income customers.

In fact, an eshop could have extended the circle of its customers by forwarding its visitors to a partner finance company or a bank for getting cash.

Internet trade can get a chance to dramatically increase the number of successful deals with prospects. For this purpose, a customer should have an opportunity to make an online purchase on credit.

However, applicable laws of Ukraine do not allow taking (or granting, to be more precise) credits online. Besides, domestic online shops can hardly be called real online traders. In fact, this is an office that provides intermediary services and delivery from a wholesale seller. A customer finds a product on a website, calls or leaves an order there, and then the online shop gets in touch with the product supplier and delivers the goods to the customer.

One can pay with a credit card at very few places, and nearly nowhere one can get an online invoice for a product and pay it by bank transfer, including at the expense of loaned money. So what’s to be done? The latest example enables us to understand what online stores should do to use collaboration with credit establishments to boost sales.

Curiously enough, a general underdevelopment of online payments in Ukraine gives an extra chance to Internet trade. If it turns out that a majority of deals is settled in cash to a deliveryman, why not to offer a customer taking a missing amount offline as a cash credit or a credit for product purchase?

An Internet trader should just place a link on its website to a partner creditor and design a webpage where a customer can form an invoice for a required product and print it. The invoice, passport and a tax payer registration number is nearly all documents needed for making an online purchase.