Small businesses may not see investing in credit card processing as an essential aspect of their business in the beginning, but the truth is that small businesses need to accept credit cards. With small profit margins, paying out a percentage of each transaction may be too crucial to the success of your business. However, adding credit card terminals to your business can increase profits between 30 percent and 100 percent, according to Small Business Brief.
Accepting credit cards can lead to greater customer satisfaction. Repeat customers and loyal brand fans arise when you have a good product and good customer service. Allowing customers to pay with credit cards is a part of that.
Customers like the speed, flexibility and convenience that come from paying with their credit card instead of cash or checks. Customers also like having the option to pay with whichever method is easiest for them. Provide them with the freedom to choose.
- Quick tip: Advertise the cards you do accept so customers know right away that they can use their credit cards with your business.
If you choose not to accept credit cards, you are limiting the number of potential customers. Impulse buyers are easier to influence when they know your business accepts credit cards. The convenience of using credit cards tends to increase the likelihood of consumer “impulse purchases.”
- Quick tip: Customers tend to spend more on their credit cards than they would if they were paying with cash. According to Maverick Bankcard, credit card users will buy two and a half times more merchandise than non-card holders.
The payment process is more efficient when it comes to credit cards over cash or checks. Small businesses can spend more time focused on the business and less on credit card processing. Electronic payments will enable faster payment cycles, which lead to improved cash flow and decreased billing overhead—a significant benefit and welcomed relief for any business.
- Quick tip: Accepting credit cards means your business gets paid faster. You can cut down on the timeline of your receivables and get the money owed you in a more timely manner, simply by accepting credit cards.
In one study conducted by Price Waterhouse Coopers, they found that the average credit card order size is three to four times larger than the average check and cash order. The number of people who prefer making purchases with credit cards is also on the rise and has surpassed those who pay with cash or checks. Many small businesses have seen an increase in sales and profits from the acceptance of credit cards as a form of payment.
- Quick tip: When determining whether accepting credit cards is a good idea for your business, take into consideration the initial investment, transaction rate, and the possibility for growth.
For the most part, small businesses need to accept credit cards, even if it means doling out a percentage of each transaction to the credit card processing company. More and more business owners are viewing credit card processing fees a necessary expense for the growth of their business. Small businesses need to accept credit cards to improve customer satisfaction, increase sales, and encourage spending.
Author Bio: Erica Bell is a small business writer who focuses on topics such as credit card processing companies and small business credit cards. She is a web content writer for Business.com.