How Buy Now, Pay Later Can Transform Your Dance Business

Growing and sustaining your dance business requires consistently gaining new enrollment. Many people may have an interest in your offerings but lack the financial means to join.

By introducing payment options for dance classes like buy now, pay later, you provide an opportunity for flexibility.

To implement this in your dance studio, keep reading to learn about buy now, pay later, its benefits, and setup. Then, review action items to take right now to implement this offering.

What Is Buy Now, Pay Later?

Buy now, pay later, or BNPL, is an installment loan model. It divides a purchase into equal monthly payments, with the first due date at the time of sale. These payment plans can include interest and fees or charge neither.

You can liken it to a modern layaway system. It’s become a very popular payment option. According to a BNPL trends study, 49% of consumers have used it since it became available.

The research also revealed that those using it trust it more than credit cards, which always come with interest fees. Over half of respondents (55%) said they relied on buy now, pay later for items they could otherwise not afford.

Keeping up with consumer trends on payments is essential to meeting customers where they are financially. It’s also a less risky program for you versus internal payment plans.

It’s an attractive payment option that meets consumer demand while safeguarding you from the impact of unmade payments.

Why is Buy Now, Pay Later a Good Option for Dance Studios?

The average monthly cost or packages for your dance classes are likely all over $100. Single classes may be less, but you want them to be on a monthly plan to increase your revenue.

These prices may be too high for many consumers. They may need to avoid incurring new expenses so they don’t buy your class packages despite wanting to. You can transform these budget-conscious consumers into customers when you use buy now, pay later.

It lets you expand your customer base because your classes are more accessible. It can transform your customer acquisition and retention numbers. It’s really a win-win for you and your members.

How Does Buy Now, Pay Later Work?

At the point of purchase or checkout, customers receive an offer to use buy now, pay later rather than paying the entire balance. If they choose to pay in installments, they must complete a short application with their personal details.

Next, they must enter a payment method. BNPL providers may conduct a soft credit check, which doesn’t impact someone’s credit score. Consumers must agree to the terms of the buy now, pay later model.

Based on the information provided, the individual receives an approval or decline. The criteria for approval varies by platform and may still be accessible for those with lower credit scores.

Companies adopting buy now, pay later use a service to set this up. You receive the payment upfront, less any applicable fees, and the customer pays the financial provider the installments.

The most common payment plans split the purchase into four, due every two weeks. These programs are adjustable as well. If using it as a payment option for dance classes, the span could be longer and would be a recurring credit card billing transaction.

What Are the Benefits of Buy Now, Pay Later?

With a buy now, pay later option, you can expand your client base and drive success for your dance studio. Here are key reasons why it’s a smart choice for your business.

Collect Payments in Full and Decrease Repayment Risk

As the business, you receive the total payment up front regardless of whether the customer completes the installment payments. The service providers assume the risk, so it’s not another financial burden.

This type of payment plan ensures you get paid faster. Customers have greater flexibility while you realize revenue faster.

FROM ONE OF OUR PARTNERS: Three Ways to Use Payment Plans to Get Paid Faster

Decrease Chargebacks or Fraud Disputes

Consumers have the option to dispute credit card transactions. It can happen in a buy now, pay later model. If the credit card company approves the dispute, a chargeback occurs, refunding the customer. These can be complex to manage, but you won’t incur this; the BNPL provider does.

Make Dance Class Enrollment Accessible to More Customers

As noted in the survey above, a motivator to use buy now, pay later is to acquire something not within someone’s budget. With payment options for dance classes that don’t require payment in full, your offerings are now in reach.

This type of payment plan is favored across all demographics, helping you diversify your customer base. The trends survey found that 58% of Gen Z, 64% of millennials, and 49% of Gen X have used BNPL.

Retain Customers Should They Have Financial Challenges

You can present buy now, pay later as an option for new and current customers. People may experience financial setbacks and have to start cutting costs. They’ll be less likely to churn if they have a fair and reasonable payment schedule. It can be the buffer that allows you to retain loyal customers.

Keep Cash Flow Steady

As a small business, reliable revenue streams are critical to your long-term viability. Buy now, pay later funds immediately so you realize the revenue faster. It’s more advantageous than allowing payment plans that you set up because you carry the risk of someone defaulting.

Improve the Customer Experience

When you can offer unique payment options for dance classes, you deliver a better customer experience. People will appreciate having an alternative to pay for something they really want.

By creating a buy now, pay later transaction workflow that’s simple and easy to understand, customers will enjoy the ease of setting up the plan. Be sure that how it appears to customers online doesn’t have any friction, like unnecessary extra steps. Clearly defining the terms and their responsibilities also sets expectations so there’s no after-purchase confusion.

Boost Your Average Customer Lifetime Value

Improving customer lifetime value equals enhanced profits. Things that threaten are churn or someone lowering their spending with your company. With the buy now, pay later as a payment option for dance classes, someone may select a higher-cost package rather than the least expensive one.

Having buy now, pay later also minimizes the need for discounting. It’s great to include promotional offers now and then. You don’t have to be dependent on them to attract new customers, which can decrease your margins.

Gain a Competitive Advantage

Competition for dance studio customers may be tight in your location. Prospective enrollees compare your services and costs. If all things are equal, they may be more inclined to choose your classes if there’s a buy now, pay later option.

How Do I Set Up Buy Now, Pay Later for My Dance Studio?

If you’re ready to launch this payment option for dance classes, here are the steps to get started.

Evaluate Buy Now, Pay Later Providers

The first step is to research the companies that offer buy now, pay later services to businesses. Popular platforms include Paypal, Affirm, Afterpay, Klarna, and Zip.

You’ll want to assess them based on:

Repayment terms: What installment plans do they offer, and how does that align with what your customers expect?

Credit limits: How much can a person defer with the program? Looking at your average billing will advise you of the limits you need.

Reputation: Read reviews of the platform to understand how well it serves its users and if there are any current issues.

Availability: Review if the payment plan is available online and at your physical location.

Explore How the BNPL Provider Integrates with Your Systems

To ensure the buy now, pay later experience is seamless for you and your customers, it will need to integrate with your dance studio accounting software: You’ll need a solution that ties to your system to manage billing and invoicing.

Some key functionalities to enable this include:

How it appears as an option during checkout based on the packages chosen by the customer

The funding part, once the transaction is complete

Any other data syncs needed between the platform and your accounting software

Create Your Account with a Chosen Provider

Once you’ve completed a thorough review and selected a provider, you’ll need to create an account. The steps for this are usually a simple verification process. This may require providing information about your business.

Test the Setup

Once you have completed your account and integration, you should do some testing before launching. Go through the typical customer payment journeys to ensure all the pieces are working. It’s not just the checkout experience. You want to make sure everything triggers correctly, such as sending confirmations and payment instructions to consumers.