In my previous post, I shared some stats on the growth of credit card usage (read here). If you are not set up to accept credit cards soon, you are going to miss out on A LOT of sales.
Below are six benefits of accepting credit cards.
Increase Sales
Studies prove that accepting credit cards boosts sales. Keep in mind that only half the people walking into your store carry more than $20 in cash. Dun & Bradstreet found that consumers spend 12-18% more when using their credit card instead of cash. For example, McDonald’s reports that the average transaction is $7 when customers use credit cards versus only $4.50 when using cash (read more here).
Build Loyal Customers
Acquiring new customers is not an easy task, and it is expensive. Therefore, building strong relationships with existing customers is critical. Loyal and happy customers will certainly refer their friends too. Word of mouth is the best free marketing you can get! Now you might ask: How do I build relationships with my customers?
Many point-of-sale systems have integrated customer management tools that will help engage existing customers. You will receive valuable insight on customer demographics and even be able to track your top spending customers. Their analytics will help to develop a more efficient marketing strategy that will keep your business at the forefront of people’s minds.
Improve Cash Flow
Credit card sales are automatically deposited into your bank account within 1-3 business days. This means you don’t have to make any trips to the bank!
Furthermore, financial institutions continuously monitor your transactions to prevent fraud. Also, transactions will decline if your customer does not have the money available. When you deposit a check, not only does it take longer to settle but it can still bounce. Therefore, accepting credit cards is much more reliable when it comes to cash flow.
Convenience
People want convenience whether they are making a big purchase or simply running an errand. If your customer needs to stop at the ATM on their way to your store, they’ll probably just opt for your competitor instead.
The checkout process is faster with credit cards too, which means more transactions every day. Say goodbye to long lines with angry customers waiting for someone to count their cash and spare change!
Safety
Retail establishments known to carry excess cash are bigger targets for robbers. Regardless of where your business resides, you could be a target. Would your business survive if a thief stole a few hundred dollars from your register one day?
Most terminals and point-of-sale software do not store full credit card numbers either. Plus, some payment processors will cover you up to $100,000 if you ever got hacked. That is one less worry you will have when accepting credit cards.
Legitimacy
Cash only businesses always seem a little untrustworthy so not accepting credit cards can damage your brand. Having the major card brand logos at your register will certainly instill a sense of trust with your customers. The more trust they have, the more likely they will come back.
In conclusion, it’s crucial to create a positive customer experience. Accepting credit cards will do just that. Not only will you keep customers engaged, but your sales will grow too.
So now that you’re ready to accept credit cards, you’ll need a merchant account. Good news! Credit card processing is a relatively small expense and quite easy to setup.
In my next post, I’ll explain what a merchant account is. Thanks for reading!