Your Competitors Do
Succeeding in today’s economy means that you must compete on all levels, including the types of payment you accept. Customers want options when it comes to paying for things and your credit card-accepting competitors will gladly give it to them if you don’t.
You’re Losing Sales
I used to live down the street from a great restaurant called “Little Burrito Jr.” that only accepted cash. The food was the best around and I would eat there often, but I would have eaten there a lot more if they accepted credit cards. In fact, there was another Mexican restaurant about an equal distance away that did accept credit cards. Even though their food wasn’t as good, I estimate that Little Burrito Jr. lost about 50% of my business to the other restaurant simply because I didn’t have cash on me when I was ready to eat. By not accepting credit and debit cards you’re losing sales at a cost that will far exceed any merchant account fees, period.
You’re Losing Customers
Losing sales and losing customers may sound like the same thing, but losing customers is far worse. When you refuse to take a credit card from a customer, and the customer has no other means to pay, it leaves the customer feeling embarrassed and rejected. The likelihood of that customer returning in the future diminishes drastically. There are several businesses that I refuse to patronize because of their no credit card policy, even though I like their products and services! I often wonder if they have any idea the number of customers they have lost forever.
You’re Losing Big Ticket Purchases
How many people do you know who always carry more than $200 in cash? The fact is that most people don’t. Whether you sell food or furniture, you’ve just lost any sale over $200 if the customer isn’t carrying a checkbook. And, who carries a checkbook anymore? Just about no one under 30 years old.
You’re Losing Impulse Purchases
When McDonald’s decided to take credit cards, they found that their average sale went from around $4 to around $7. Studies show that people spend more freely when using a card. I wouldn’t doubt that your own spending would reflect the same findings.
You’re Paying more in Bounced Checks
The average fee a business incurs for a bounced check is $25 per check, and that’s not even figuring in the time and money lost trying to get your money from the customer afterwards. Credit and debit cards don’t bounce.