Never Miss a Sale – Accept Multiple Payment Methods
If you’re a business owner and you’re not offering multiple payment methods, you’re putting yourself at a significant disadvantage. With 50 percent of shoppers saying they would not make purchases if their preferred payment method was not available, this is a customer base you seriously can’t afford to be missing out on. These days, the technology to accept multiple payment methods is widely available, yet many businesses are still not taking advantage of it. Here we take a look at the changing face of payment and what adapting to it could do for your business.
Shopping Is Increasingly Cashless
A recent survey by Bankrate revealed that 80 percent of people now carry less than $50 in cash on a regular basis. About 49 percent of those surveyed carry $20 or less, with 9 percent no longer carrying cash at all. Greg McBride, Bankrate’s chief financial analyst, said, “Consumers prefer to pay with plastic, debit or credit or some other type of mobile technology.”
This is borne out of research into people’s preferred payment methods, conducted by NextAdvisor in 2015. The results showed that 42 percent of people preferred to pay by debit cards, with credit cards coming a close second at 38 percent. About 17 percent chose to pay with cash, and only 3 percent preferred to pay by check.
However, as each of these choices represents a potential customer base, if you’re refusing any one of these methods, you’re not offering your customers the flexibility they can find elsewhere. Adaptability is key for retailers in this rapidly changing climate, especially with the ever-rising popularity of online shopping, a market which is now worth $1,471 billion worldwide.
How Multiple Payment Options Could Improve Your Business
There are a variety of reasons why accepting multiple payment options is now essential for your business to stay competitive and profitable.
Customers these days want flexibility, and you can dramatically increase your revenue simply by offering one additional payment method. This was demonstrated to great effect by Limor Friedman, owner of Vancouver In The Box, who increased her revenue by 20 percent simply by accepting credit card payments.
If you don’t have the facilities to accept card payments, you won’t be able to sell your products online, which means you are putting unnecessary limits on your business, restricting it to a physical environment and store hours. Ecommerce enables you to sell your products 24 hours a day to a global customer base.
Increased Cash Flow
Some merchants are discouraged from offering card payments, as they have to pay processing fees. However, not only will these easily be overridden by the increased customers you’ll get, but it also offers more instant cash flow at your disposal. Cash is convenient, but as we’ve seen, not many people choose to use it anymore. Card payments clear within 48 hours, unlike checks, which can take up to 90 days. In addition, you can see instantly if a card is declined, whereas if a check is declined, it can leave you having to spend time tracking down NSF fees. When you combine this with sending out invoices, chasing payments and visiting the bank, you can see how much time is taken up that you could be spending far more productively in growing your business.
Improved Customer Service
This is the single most important reason why it’s vital that you offer a variety of payment options. If a consumer finds that you don’t take cards and they don’t carry cash, they’re unlikely to bother going to withdraw cash and coming back, especially as many out-of-network ATMs and banks now charge cash withdrawal fees averaging more than $4 per withdrawal. Potential customers simply will not be willing to pay those fees when they can have their cards accepted by your competitors. Their first shopping experience with you has to be good enough to make them want to return, as it’s estimated that increasing your customer retention rates by 5 percent can increase your profits by up to a staggering 95 percent.
In today’s commercial landscape, if you’re not offering multiple payment methods, you’re just not keeping up. By offering customers the choice they expect, you’re also offering them the best value for their money, and that is what will keep them coming back to you again and again.