How FC financing works for BIG, page-147

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Warnie

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25/02/18

16:02

Post #: 31326073
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Originally posted by Warnie ↑

So why does it say...

The Customer signs an application agreement which includes the obligation to pay a monthly $1,000 fee for 12 months membership, contingent upon the Customer accepting the Video (Membership Fee)?

................

The way I see BRTV selling this product is simply...

we can offer you a $12,000 credit line, that is interest free for the first 12 months, paid at $1000 month for 12 months (as your membership period)and includes payment of your video package.

Note: ********BIG would want the facility to be as high as possible because they are upfronted 35% for cashflow.

Some packages are only $500p.a
Are you telling me 35% or $175 covers the cost to produce the video?

No, that is why the BRTV sales team do all they can to

a) sell a package under finance and
b) sell one at the maximum approved limit set by FCC.

So BIG would then issue FCC a customer application agreement for the full $12,000 as this is what they are applying for, not just $4000 for a video package.

As a counter argument:

I guess FCC could wear the remaining $8000 as a no interest charge facility for the (first 12 months only) so repaid in full within 12 months hence $1000 month repayment and for that FCC get to put their heads on the videos, and have a new client.

Assuming BRTV only pay interest or commission on the video portion, and FCC give the client a 12 months to pay option on the full $12,000, advanced, If average "financed package" is $8200 then FCC would have received $1968 commission which is still 16%p.a return on the full $12,000.

For this it gets them a client, gets them advertising on the videos, and 16% ROI minimum.

Expand

Actually I'll simplify and ask the question another way entirely:

Why would a customer sign an application agreement to agree to pay $1000 month x 12 months on say a $5000 video package which is meant to be interest free?

BIG Price at posting: $2.22 Sentiment: None Disclosure: Not Held
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How FC financing works for BIG, page-147

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