How to Offer Finance for Sofas & Sectionals

Introduction

The furniture market is increasingly competitive, especially for sofas and sectionals, where customers expect luxury, durability, and flexibility in payment. Offering finance can be a game-changer for retailers looking to boost sales and customer loyalty.

"Flexible finance isn't just a perk—it's a strategic tool for keeping your business competitive in the sofa retail market."

Why Finance Makes Sense for Sofa Retailers

Offering finance for sofas and sectionals provides several compelling benefits:

• Increase Average Order Value: Customers can afford higher-priced items when payments are spread over time.
• Reduce Purchase Barriers: Finance options break down the cost, making luxury sofas accessible.
• Stay Competitive: Many retailers now offer finance—don’t let your business fall behind.
• Enhance Customer Loyalty: Make purchasing easier and build long-term relationships.

Fast Facts

Types of Retail Finance for Sofas

Sofa retailers commonly use these finance options:

1. Interest-Free Credit (0% APR): Lets the customer pay over a period (typically 6-36 months) without interest.
2. Interest-Bearing Credit: Spreads cost over 12-60 months with a fixed interest rate (often 9.9% - 19.9% APR).
3. Buy Now, Pay Later: Customers defer payments for an initial period.
4. Personal Loans via Partnerships: Arranged through third-party lenders.

Which is Best?

"Interest-free credit is especially popular for larger purchases, like sectionals, where price tags can cross £1000."

Steps to Set Up Customer Finance

To launch finance for your sofa business, follow these steps:

1. Choose a Retail Finance Broker: Experienced brokers like Kandoo introduce you to regulated lenders.
2. Apply for FCA Authorisation: Required to offer consumer credit in the UK (some brokers offer umbrella arrangements if you’re not authorised).
3. Select Finance Products: Pick terms and rates suitable for your customer base.
4. Integrate Checkout Solution: Seamless POS or online integration increases uptake.
5. Train Staff: Ensure your team can confidently explain finance options.
6. Market the Feature: Promote financing in-store, online, and in all communications.

Callout: Working with Kandoo

Kandoo is a UK-based broker specialising in retail finance. We partner with leading furniture retailers to set up flexible, FCA-compliant customer finance.

Legal and Compliance Considerations

Selling finance is highly regulated. It’s critical to:

• Ensure you (or your umbrella broker) are FCA-authorised.
• Present offers clearly and transparently—no hidden fees.
• Adhere to rules around responsible lending and fair marketing.

"Mis-selling or unclear terms can lead to hefty fines. Clarity builds trust."

Tips for Maximising Finance Uptake on Sofas

• Showcase monthly payment options directly on product pages.
• Use point-of-sale materials highlighting affordable finance.
• Incentivise finance with limited-time 0% offers.
• Train staff to identify and address customer buying hesitations.

Frequently Asked Questions

Q: Will I receive the full sales value upfront?

Yes. Finance providers typically pay you in full when the sale completes, less any agreed commission or fees.

Q: What if a customer misses payments?

The finance provider handles collections – you’re not at risk.

Q: Is offering finance expensive?

Costs vary by provider and terms, but increased sales often offset commission fees.

Key Takeaways

• Finance drives sales, raises order values, and keeps your sofa business competitive.
• Partnering with an expert broker simplifies setup and ensures compliance.
• Promote finance effectively to maximise benefit for you and your customers.

"Start offering flexible finance today to transform your sofa business into a customer favourite."

Next Steps

Ready to set up sofa finance? Reach out to a specialist like Kandoo for an informal chat or discover more at Kandoo’s retail finance solutions page.