Penny-Wise, Pound-Foolish When Accepting Payment
Have you ever found yourself in a situation where you fully intended to buy something only to find you didn’t have enough cash and the store didn’t accept credit cards?
Maybe you left the store thinking you’d come back in the next day or so to make the purchase. A month or so later, you realized you totally forgot to go back.
I’ve found myself in this situation many times over the years. Although more and more I find myself feeling a little irritated at the store owner. Accepting debit/credit cards seems like the norm nowadays for people to pay for their goods.
You may feel inclined to write me and tell me, “They don’t want to pay the credit card fees.” And I get it. Those fees add up, and it takes a chunk out of a business owner’s profit.
However, it’s the cost of doing business in our society. And it’s our job to make it easy for our customers to do business with us. More importantly, how much business are you losing by not accepting credit cards, PayPal, etc.?
Penny Wise Pound Foolish Continued…
In the last month, three different business owners have postponed accepting payment from me because they didn’t want to pay credit card fees. When I explained I don’t carry a lot of cash, and I never carry a checkbook, they said they were willing to wait for me to mail them checks.
What the heck? When people are ready to pay you money for your products/services, it's foolish not to accept it because it’s going to cost you a few extra dollars in fees. You risk losing their business because they forget, they change their minds, or someone else comes along who does accept credit cards.
Your Savvy Sales Tip this week: Penny Wise Pound Foolish
Stop being penny wise and pound foolish when it comes to accepting different forms of payment. When a client’s ready to pay you, take the money, don’t slow down the transaction trying to “save” a few bucks.
Penny Wise Pound Foolish Continued…
Spending extra time and energy trying to save a few dollars in fees means your focus is not on making money. You’re approaching your business from a place of lack vs. a place of abundance. This mindset seems completely backward.
Now being fiscally responsible is important, don’t get me wrong. It’s also important to not impede sales.
For those that really can’t afford the fees, consider building them into the sale price. A business owner I admire said to me a few weeks ago, “You can pay with a credit card; however, I’ll need to charge you a 2.5 fee on top of the sale price.” My response was “Fine, no problem.”
Of course, from a language and rapport standpoint, I would suggest instead of telling your clients they have to pay an extra fee for using a credit card, phrase it like this, “You’ll receive a 2.5 discount when you pay with cash or check.” That will likely be received much better. It no longer sounds like you are penalizing a customer but instead rewarding them.
Wishing you continued success this week.
Agree? Disagree? Have additional comments or thoughts on this article? Please share.
