Now that you have started your business, you probably have been inundated by calls or emails about accepting credit cards. You may think your business is too small, your customers will only want to pay with cash, I only do business to business sales, or I provide services for the government. Or better yet, think it is too expensive.
The answer is that none of these are valid reasons to not accept credit cards. Let’s break down each opposition to accepting credit cards/debit cards.
My customers only pay with cash: Again, as stated earlier, most people carry less than $20.00 and have less than $1000 in their checking account. But here is another reason why customers would want to pay with their credit card…REWARDS! That’s right; people want to earn the rewards they earn by using a credit card. These rewards make people want to spend more and you never have to worry about a bounced check. Once the card is approved, the funds are transferred into your business account. This means fewer trips to your bank to make deposits. A win-win!
I only do Business to Business: Businesses use credit cards too! Businesses want to use cards to help them track spending, control spending by employees and they can own reward cards as well. There is another great reason to accept cards from businesses. You get paid faster! That has to be the best reason your business should be accepting credit cards from other businesses!
I provide services for the federal or state government: Have you heard of the Paper Reduction Act? This law requires that the federal government pay for services with a card for most contracts under $10,000. In fact, credit cards are actively used by the federal and state governments. Small purchases (under $2,500) are commonly paid for with a credit card. If your business generates its income from business to business sales/services, you should be looking into providing government services as well. Don’t miss out on a contract by not being able to accept credit cards!
Lastly- I think it is too expensive: This is where most businesses fail to see the big picture. By accepting cards and offering more payment options, this is the least expensive part of doing business. Think about it. What are your main expenses: employees, and your business space! The least expensive part of growing your business presence is accepting credit cards. There are many ways you can accept cards, using a traditional credit card terminal, a Point of Sale System (acts as a full business management system as well as a payment tool), online or using your smart phone. Sure there may be an upfront cost of equipment, but this can be written off as a business expense. The fees you pay to a credit card processor can always be negotiated. These negotiated fees consist of the processing rates, transaction fees and monthly service fees. Understand that there set fees for each card brand (Visa/MC/Discover.) American Express controls its own fees and will be the same for any processor. Shop around and ask questions. If you are a service company such as a plumbing company, using your mobile phone is probably the best and cheapest. You already have most of the equipment by just having your phone. You are a retail or face to face brick and mortar business: then using a traditional credit card terminal is for you. The prices on these terminals can vary, so again shop around. If you are an online/mail order business, business to business or government service provider, then using a virtual terminal is your best bet. No equipment fees! Plus, most virtual terminals allow for recurring billing. Remember everything can be negotiated. Processing companies want your business. The reality is that you cannot afford not to accept credit cards!
So, congratulations! You are a business owner. Grow your business by doing the simplest thing…accept credit and debit cards!