The Concept
The rapid growth of the
Alpaca industry has generated a lot of sales activity. It seems everyone has an
animal they want to sell, and the smaller breeder is at a disadvantage in the
marketing arena. A smaller operation needs cash to offset the expenses of the
business as well as the costs of marketing their animals. They may be forced to
sell alpacas with some form of financing, but would rather get cash up front.
Unfortunately, competitive pressures make financing a necessity in many situations.
A solution to this problem
would be to offer a sales agreement with liberal financing(3
– 5 years), and a reasonable interest rate(prime, or prime+1). Then after the
animal is sold, assign that sales agreement(note) to
another party for cash. This accomplishes the following objectives:
·
Allows the buyer
to purchase an animal at an attractive monthly cost.
·
Allows the
seller to get cash back immediately from the sale.
·
May allow the
seller to command a higher price because of the attractive financing.