Introduction
For years, Spiffs and Rebates have been used by lenders to drive financing volume. These incentives, often ranging from $20 per deal to larger rebates, may seem like a win for sales teams and retailers — but at what cost?
Many retailers unknowingly sacrifice thousands in gross margin by prioritizing short-term incentives instead of focusing on approvals that close the sale. When a salesperson pushes a lender because of a Spiff or Rebate instead of ensuring the best financing approval, it can lead to lost sales, lower ticket sizes, and higher customer drop-off rates.
At LendPro, we can eliminate this risk by ensuring that financing applications are routed to multiple lenders if the approval or the purchase amount is not met by a preferred lender. This approach will result in increasing approvals, ticket sizes, and gross margins — without forcing retailers to rely on lender-driven incentives that may be working against their bottom line.
Why Do Lenders Offer Spiffs & Rebates?
Spiffs and Rebates exist for a simple reason: Lenders want first look at every financing application.
To accomplish this, they offer:
💰 Spiffs – Small cash bonuses ($20-$50 per deal) to salespeople for submitting applications to them first.
🔄 Rebates – A percentage back to retailers if they exclusively promote that lender over others.
The problem? Spiffs & Rebates don’t guarantee the best financing approval — they only guarantee first look.
If the financing provider declines the application or offers less favorable terms, the customer must reapply with another lender — or worse, leave without purchasing, if the merchant is not using LendPro.
This means retailers are trading high-margin sales for small kickbacks, often at the expense of revenue growth.
The Real Cost: Trading Gross Margin for Short-Term Incentives
Retailers operate on 20-40% gross margins for big-ticket items like tires, furniture, electronics, etc.
Scenario 1: The Spiff or Rebate-Driven Sale
🚨 A sales associate pushes a lender offering a $20 spiff or rebate.
❌ The customer applies and is denied because the lender wasn’t the best fit.
🔁 Now, the salesperson must convince the customer to reapply, adding friction to the process.
🚶 The frustrated customer walks away, and the retailer loses a $3,000 sale with a 30% margin ($900 in lost profit).
Retailer Outcome: Lost sale. Lost revenue. All for a $20 spiff or a small rebate.
Scenario 2: The LendPro Approach
✅ A sales associate or a web customer submits a single application through LendPro.
💡 Multiple lenders review the application, ensuring the best financing approval and amount needed.
💰 The customer gets approved, completes the $3,000 purchase, and the retailer captures a $900 gross profit.
Retailer Outcome: Sale completed. Margin secured. Customer retained.
It’s simple math — prioritizing a spiff or rebate over real revenue doesn’t make financial sense.
How LendPro Protects Retailers’ Margins & Sales
LendPro removes the risk of losing high-margin sales due to lender incentives by ensuring more approvals and larger ticket sizes.
✔️ One Application — Multiple Lenders
Instead of being locked into a single lender’s offer, every application goes to multiple financing providers, increasing approval rates.
✔️ Higher Ticket Sales = More Profit
Better approvals allow customers to buy more, increasing average ticket sizes and gross margins per sale.
✔️ Faster Sales Process = More Conversions
A one-application system eliminates customer drop-off, making the buying process smooth and stress-free.
✔️ Retailer-First Profitability
No distractions — just higher approvals, bigger sales, and greater revenue retention.
Spiff/Rebate-Driven Financing vs. LendPro’s Multi-Lender Approach
|
Feature |
Spiff/Rebate-Driven Financing |
LendPro Multi-lender Model |
|---|---|---|
|
Approval Rate |
Lower – Limited to one provider |
Higher – Multiple lender approvals |
|
Lost Sales Risk |
High – If declined, customer may walk away |
Low – One application increases approval chances |
|
Gross Margin Impact |
Sacrificed – Prioritizing lender incentives risks high-margin sales |
Maximized – Focus stays on financing the sale |
|
Customer Experience |
Frustrating – Reapply if denied |
Seamless – One application, multiple approvals |
|
Sales Process |
Longer – Extra steps for reapplying |
Faster – More approvals, more completed sales |
Final Thoughts: Protect Your Profits with LendPro
Retailers should ask themselves:
Is a $20 spiff or small rebate worth losing a $3,000 sale?
With LendPro, businesses:
✔️ Get more customers approved on the first attempt
✔️ Increase ticket sizes & maximize profit margins
✔️ Avoid lost sales caused by lender-driven incentives
Lenders may continue to offer Spiffs & Rebates to gain first-look advantage, but retailers need a financing platform that prioritizes approvals over incentives.
💡 The smart move? Choosing LendPro — where every application gets the best chance at approval.
Get Started with LendPro Today!
💻 Visit my mylendpro.com
Legal Disclaimer:
This article is for informational purposes only and does not constitute financial or legal advice. Businesses should consult their own advisors to ensure compliance with applicable laws and industry best practices related to financing, sales incentives, and consumer lending regulations.