Buy now, pay later (BNPL) has been taking retail industries by storm, and sporting goods stores are no exception. Dicks Sporting Goods, whose sales comprise almost 10% of US sporting goods sales annually, implemented BNPL in Q4 of 2021. This signals a massive shift within the industry toward offering more flexible payment options, as massive chains like Dicks tend to set the standard for customer expectations.
But why is this shift taking place? What makes BNPL and other consumer financing products a good fit for sporting goods retailers? Today, we are going to go over a few important factors involved when stores like Dick’s decide to incorporate POS financing, which includes:
- What BNPL is
- Benefits of BNPL for stores like Dick’s
- How easy it is to implement
Let’s dive into each to help business owners understand why it is so important to adopt flexible payment options.
What is BNPL?
BNPL programs function similarly to a loan but often offer low-to-no interest and don’t report to credit bureaus unless payments are late or missed. This means that consumers can obtain the benefit of breaking up a purchase into more manageable payments, but they don’t have to deal with hefty interest charges or impact on their credit score for doing so.
This solves the major problem consumers have with traditional personal loans—the interest is too expensive, and the credit impact is too severe to justify taking financing for a non-essential purchase. It is a reasonable hesitation since it does seem pretty reckless to ding one’s credit score and pay interest charges for a purchase that only costs a few hundred dollars. With BNPL, consumers get to make that purchase and finance it without worrying about either.
Benefits of BNPL for Stores Like Dick’s
The benefits of BNPL for consumers are obvious, but how does offering flexible payment benefit the sporting goods retailer? There are a few very significant benefits of BNPL for stores like Dick’s to consider, which include:
- Increased conversion and average ticket size
- Wider customer base
- Streamlined checkout process
Increased Conversion and Average Ticket Size
Obviously, giving consumers an increase in their buying power will influence the frequency and size of their purchases. In fact, businesses that offer BNPL financing see an average 20-30% increase in conversion and a 30-50% increase in average ticket size. This is incredibly substantial, as it isn’t just increasing the number of sales but also the profitability of each individual purchase.
Wider Customer Base
There are many consumers out there who want better fitness gear, home workout equipment, or other sporting goods products but don’t have the money to pay for them all at once. BNPL helps bridge these gaps in every industry that adopts it, with 49% of BNPL users saying they used it to make a purchase that would have otherwise been outside their budget.
Streamlined Checkout Process
Retailers typically implement BNPL by partnering with a fintech provider that grants them access to a software platform they can embed into their site and/or app. Quality fintechs will not only be able to offer BNPL in a consumable way but will also offer one-click payment functionality and more streamlined checkout processes to make it easier for any customer to make a purchase, regardless of whether or not they choose to accept financing for their purchase.
This is why partnering with the best fintech partner is essential. Luckily, Skeps offers a top-of-the-line software platform for stores like Dick’s wanting to provide financing for sporting goods.
Offer Sporting Goods 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:
- Consumer loans and leases
- Branded credit cards
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.