31 Aug The Hidden Costs Of Zero Percent Finance When Purchasing Sanitary Ware
Recently we had a customer come to us who was considering financing his sanitary ware using a 0% interest free for 12 months credit arrangement. This had been offered through a bathroom showroom that he had visited. On the face of it this sounded like quite a good deal. Who doesn’t want something for free right?
However when we looked at it a bit closer with him, what had seemed like a good deal turned out not to be quite so good. You see when a business is offering 0% interest it isn’t going to be out of the kindness of their heart. It just means that some financial sleight of hand is taking place. You see the 0% offer was against the full retail price of the sanitary ware, whereas we know that if our customers ask us to supply sanitary ware we can typically get at least 10% discount from the retail price, sometimes more, and we always pass this on to our clients at cost.
So lets look at an example, of how a typical €10,000 purchase of good quality sanitary ware could work out. On the 0% offer these are the figures:
€10,000 purchase price over 12 months at 0% = 12 payments of €833.33 per month to give a total cost of €10,000
Now lets do the calculation with the same order, but assuming we can get you a 10% discount from the retail price, and that you get a loan from a bank or credit union for 8.57% APR.
€10,000 retail price less 10% discount = €9000
€9,000 purchase price over 12 months at 8.57% = 12 payments of €785.27 per month to give a total cost of €9,423.24.
So that is a nice saving of €576.76, nearly €600 by getting us to source sanitary ware and avoiding the ‘cheap’ 0% finance option.
As with all of our client projects, we work for the client, with the aim to give them a high quality finished product, and as part of that service we can supply all types of fitting and sanitary ware, saving you money in the long run.
If you are considering a bathroom renovation in the next few months then please get in touch now as we are booking up fast.