Due to budgetary constraints and a lack of resources, achieving lasting success can be a challenge for smaller sized businesses. One of the biggest contributors to 82% of businesses failing, according to U.S. Bank, is the lack of cash flow within an organization. With 66% of American consumers preferring to use credit cards to make a purchase, businesses can increase cash flow by accepting credit cards as a form of payment.
Here are 5 ways accepting credit cards can help small businesses:
1. Decrease Transaction Time
Customers don’t like dealing with cash. Accepting credit cards can cut transaction times down to seconds, benefitting both the customer and the merchant. Merchants can offer more efficient customer service and customers will appreciate shorter waiting times. In fact, 70% of consumers are less likely to return to a store if they experience long waiting times.
2. Boost Sales
The value of cash is concrete, but credit cards offer much more flexibility. According to a CreditCards.com survey, 5 out of 6 Americans admit to making impulse buys. In fact, consumers spend 12-18% more with credit cards than cash. Merchants that accept credit cards can increase sales since consumers tend to be more relaxed with credit budgets than cash payments. Credit card payments also allow businesses to sell products online, giving customers the freedom to shop and purchase inventory at any time, from any location. Online stores can greatly increase transaction amounts and boost sales for a small business.
3. Increase Security
Processing credit cards is quicker and more secure with a merchant services provider. Advanced technology such as encryption and tokenization keeps card data and customer account information protected. In addition, merchants can virtually process credit cards with ease and rest assured that data will remain safe from hackers or other fraudulent activity.
4. Grow Customer Market
Capturing only cash payments limits businesses to a smaller available market. According to Federal Reserve data, 72% of consumers have at least one credit card. When merchants accept credit cards, they open their doors to a much wider customer market. Accepting credit cards also adds more credibility to your business. Simply being able to display credit card logos at your business or on your website helps build trust with prospective customers, and can encourage them to do business with your company.
5. Save Time and Money
Accepting credit cards can help small businesses save time and money. Many merchant service providers offer advanced online gateways that allow merchants to process transactions virtually. In addition, there are payment gateways that integrate to accounting software to accelerate and simplify the credit card payment process. With payment processing software, merchants can settle batches electronically at the end of the day and receive funds in their account within 48 hours.
Invest in Your Business
Accepting credit cards can help small businesses grow and flourish. With the addition of electronic payments, you can increase sales, expand your customer base, and reduce transaction time to heighten the overall customer experience and extend the life of your business.