I'm thinking that everytime we offer a pay plan to a customer, we lose
money by not collecting payment (premium, since I am in the insurance
industry) in full at the time of sale based on either a present value
or npv calculation. I would like to be able to calculate that loss for
various terms offered, i.e., 25% and 9 installments, 20% deposit and 8
installments, etc. While I think that my organization understands the
value of collecting larger deposits and few installments, I'm not sure
that they ever make the calculation that looks at the loss associated
with the offering of a pay plan vs collecting the balance in full (via
external financing, etc). I would like to do that but I need some help
putting together the calculation. TIA!