Whether you own a small business or a corporation, you're probably always looking for new ways to increase your bottom line. One of the best ways that you can do this is by accepting multiple forms of payment and not just cash. More specifically, you should start accepting credit and debit cards as a form of payment. This relatively small change can have a major impact on the profitability of your business.
Understandably, you may be hesitant about the idea of accepting credit and debit cards due to all the news about security breaches. Many small business owners are particularly wary when it comes to credit and debit card processing and security breaches because even the largest of corporations are falling to these cyber crimes. Yahoo, Equifax, and eBay are just a few of the many companies that have been on the news due to security breaches.
While this is a valid concern, the benefits of credit and debit card processing are well worth considering. And there are ways to keep your customers credit card data safe.
Here are seven ways credit card processing can help you improve your bottom line.
1. Boosts Overall Sales
A significant increase in sales is one of the first changes that many business owners notice after adding credit and debit cards as a payment option. In fact, some business owners have found that credit and debit card processing has helped them double or even triple sales. Intuit recently conducted a survey and found that 83 percent of small businesses had their sales increase upon accepting credit cards. Therefore, if you've noticed that the sales for your business have been lackluster lately, credit card processing may give you the boost that you need.
2. Customers Spend More with Credit Cards
Chances are, you've noticed the phenomenon of spending more with credit cards. In fact, you may have observed this tendency in your own behavior. Many research studies have shown that customers are more prone to spending when they have a credit card in hand and not a wad of cash. Customers are also more likely to make impulse purchases when using credit cards. In fact, customers even give bigger tips to employees in the service sector with their credit card than with cash from their wallet.
The commonly accepted explanation for this phenomenon is that there is a slight disconnect in the minds of customers between the plastic credit or debit card (or smartphone for mobile payments) and the money they have available for spending. In other words, making purchases with a credit card can feel like spending "unlimited" money. On the other hand, when a customer spends their physical cash, it's more clear to the customer's mind that the money in their wallet is limited rather than unlimited.
3. Improves Customer Service
Even though customers tend to spend more with their credit cards, cash payments are declining significantly. According to Visa, about 33 percent of all purchases are made with a credit or debit card. Therefore, customers are beginning to expect that they will be able to make a purchase with a credit card. For most customers, credit cards represent flexibility and convenience, so they will be more eager to do business with you if you offer credit and debit card processing. Some customers will only purchase big-ticket items with a credit card, because it gives them the ability and option to pay off the purchase over time rather than all at once.
4. Increase Your Customer Base
Another way credit and debit card processing can help you improve your bottom line is increasing your customer base. When customers use credit cards for international purchases, the money is automatically converted to the correct currency. Therefore, credit and debit card processing can give your business the ability to sell products and services internationally. If you have a website for your business, credit and debit card processing will turn the world into your oyster.
5. Makes a Business More Trustworthy
As a business owner, one of your main goals is to maintain the image of your business. You want your business to be seen as credible and trustworthy in the eyes of your customer. One way you can do this is by adopting credit and debit card processing. Customers tend to view businesses with credit and debit card processing as more credible and established.
6. Boosts Cash Flow
If your business accepts checks, you know firsthand how long it can take for a check to clear. It can take even longer to receive a payment after sending a customer a bill. If you're frustrated with the cash flow of your business, you should consider credit and debit card processing. When it comes to credit card payments, you will have the funds in your bank account within a few days rather than weeks or months.
The final advantage of credit and debit card processing is that it's often more efficient than other forms of payment. Credit and debit card processing is automated, which means you won't have to do as much work to receive payments. You will be able to direct this time to more vital business operations.
Many businesses are jumping on the credit card and debit card processing bandwagon, and for good reason. For more information about the benefits of credit card processing for your bottom line, don't hesitate to contact us.
For more information about credit card processing and PCI compliance, don't hesitate to contact us.