How do I establish my Average Cost of Credit?

What is Average Cost of Credit?

It's the percentage that reflects how much it costs your business to offer financing options. This cost is added across all jobs to recover the expense of offering payment plans.

How to Calculate Average Cost of Credit

Here’s a simplified version of how to calculate

Total Dealer Fees Paid ÷ Total Sales = Average Cost of Credit %

Example:

• Dealer Fees Paid: $5,000
• Total Sales: $100,000
• Average Cost of Credit = 5%

SilverBullet also provides a helpful spreadsheet with two tools: (click here to download)

1. Calculator Sheet – Estimate the percentage based on prior sales volume by payment type.
2. Evaluator Sheet – Track actual sales and financing fees over time for accurate assessment.

How to Enter It in SilverBullet

1. Log in as an Admin User.
2. Go to Setup > Step 2 – Financing Program.
3. Check the circle next to Avg. Cost of Credit %.
4. Enter your calculated percentage in the field at the top right.
5. Click Update Financing to save.

Recheck Periodically

Be sure to revisit and recalculate your average cost of credit:

• When you're just starting out
• After changing financing options
• Periodically, to keep pricing accurate