It is no mystery that merchant services is a necessity
when in the retail and restaurant industries. However, the service industry,
especially professional service industry, has done an amazing job of toeing the
line between needing to accept credit and debit cards and operating a cash and
check only business model. Many business service companies choose not to accept
credit cards as they find the fees to not be worthwhile for them. However,
there are many benefits for the business service companies that take the plunge
and begin accepting credit and debit card payments.
Merchant Services Equate to Faster Payment
Service businesses are accustomed to delayed payments.
Many service customers will make payment within 90 days of receiving an invoice
for services rendered. If payments must be in the form of cash or check, this longer
payment cycle is most convenient for the customer, causing the business to have
to operate on minimal cash flow in the beginning of its practice.
However, these same businesses that accept credit
cards have found that the payment cycle is much faster. Many clients will pay
he invoice immediately with a credit card and worry about paying the credit
card off through a more extended payment cycle. The added convenience to the
customer will allow the business to have a more active cash flow that negates
the need for its own credit cards, loans, or even factoring options.
Merchant Services Increase Revenue
Much like retail, people want immediate gratification when using a service company. This means people will want to buy now and pay later. Accepting credit cards allows people to shop for services in this manner. Unlike retail, the individual may still work with your company if you do not accept credit cards, but they may need to wait to sign on for your services until they have the money in the bank. This means they may take months to sign with your company, giving them ample time to change their mind and choose not to utilize your services. Even if they do sign on, you lost four or five months of service revenue because they needed to have cash on hand to work with you. This can equate to thousands of dollars a month.
Working with a merchant services provider will help reduce
this revenue loss by making it convenient to work with you the moment the
person wants to sign on, as opposed to waiting for the funding to come through.
For the few cases in which the person chooses another provider who does take
credit cards, you will now be able to compete with those competitors and keep
the business of those that prefer convenience over quality.