Things Every Business Should Know About Payments—A Series
1) Benefits From Accepting Credit Cards
- Make More Money: Consumers spend twice as much when using a credit card rather than cash. When using cash, a customer only has a limited amount that they can spend. With a credit card, money seems endless (even though it’s not), and buyers are more likely to “splurge” since the payment doesn’t seem immediate.
- Increased Revenue!: It’s rare that someone carries around more than $20 cash now-a-days, and pennies, nickels, and dimes are almost extinct. When the total comes out to be $21.44, and the buyer only has a $20 bill, it is more likely that they will just resort to using their credit/debit card rather than scavenging through their purse to find spare change to pay the difference.
- Keep Track Of Who’s Buying: When a customer uses a credit card, they end up leaving you with some way to identify them—usually a name—which can be beneficial to your business. Keeping customer information on file can be a way to expand your future marketing campaigns. It can also help you keep track of your sales history, and see who your biggest buyers are just in case they decide to come back in and make purchases in the future.
- Know Your Funds: Computers love cards. It’s a simple way to avoid mistakes in records because they do all the work! Cash is handled by the customer and cashier, allowing more room for error in the numbers. Once a card is swiped, the computer does the calculations and it’s in your system—quick and easy! Credit cards make it easier to keep track of your funds, and reduce the risk of mistakes.
- Get Paid Faster: A large amount of small business owners say that accepting credit cards helps them avoid non-payment/debt. Accepting credit cards guarantees you that at some point, you will get paid whereas cash is on a case by case basis.
- Improve Cash Flow: Last year, 45% of 1,000 small business owners cited “not getting paid on time by clients and customers” as the biggest challenge they faced when managing cash flow (Bank of America, Wall Street Journal, Feb 2013 quote). Using credit cards could prevent this, putting more money in your pocket in the long run!
- Finally, Faster Sales!: Say you own a coffee shop in a busy, downtown, industrial area. A customer comes up during your morning rush, orders a coffee for $2.35, and you don’t accept credit cards. This brings about the process of them having to count out the exact change, and then your cashier doing the same as well. Both parties are rushed because the customer just wants her coffee so she can start her day and get to work on time, and your cashier is trying to move on to the next person in line to calm the rush. The solution to this issue? Credit cards! One swipe and the line is flowing quickly through your coffee shop, generating more revenue at a faster pace.
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