How to use your credit limit to improve the shopping experience in your store

[jisansorkar8990]

In over 15 years working with credit management for retail, I have observed that the vast majority of stores are still not aware of the importance of credit limits in improving the customer's shopping experience.

When I talk to store owners about this subject, I often hear that their only concern when setting credit limits is the issue of customer debt.

The general idea is to find a maximum value that allows for granting overseas chinese in australia data credit without running the risk of not receiving payment for the sale.

For fear of taking risks, many decide to give a low initial limit to test the payment capacity of those who are buying for the first time on credit in the store.

This fear is justifiable.

After all, who wants to suffer losses due to default , collections and negative listings ?

But it's always good to look at things from another angle and ask yourself:

What is this practice adding to the customer's shopping experience ?

The answer is: very little.

Almost nothing, to be exact.

But it is possible to change this in a simple and effective way.

In this article, I will quickly explain how your store can use the credit limit to improve this experience, focusing on the right customers and without fear of default.

I recently recorded a video for our YouTube channel discussing how to improve the customer shopping experience. Click play and check it out!
YouTube video
Credit limit is also marketing
The view of the credit limit as a mechanism for controlling default is correct and cannot be ignored by the retailer.

However, it is important to understand that this limit can serve as a reason to attract and retain customers for your business.

Did you know that customers who get a good credit limit on their first purchase tend to tell their friends and family about it?

It usually goes something like this:

– You know, I went shopping for the first time at “Loja do Zé” and he gave me a credit limit of R$900.

– Wow! R$900 for your first purchase!? How cool! I’ll stop by and see if I can open a credit account too.

With a customer like that, the person leaves your store happy with a smile from ear to ear.

See how you can improve the shopping experience for this customer!

Very different from someone who expected to buy more and ends up leaving the store with a credit limit of R$200.