In the darkest days of the economic recession, small businesses in America were closing their doors at an astonishing rate. Bankruptcy filings increased by a whopping 79 percent from 2007 to 2009, according to the Office of Advocacy of the US Small Business Administration. What does this mean for America? Since small firms employ nearly half of the nation’s workers, any economic recovery must include them.
Where to Start?
Small businesses must increase profits and cut expenses. It’s not easy, we know. In fact, most small firms are already adept at stretching budgets. But there is one particular area where small businesses are well behind their larger competitors. We are speaking of course about online sales. For some strange reason, many small businesses have yet to offer their goods or services on the internet. Whether their reluctance to go online is due to tradition or simple stubbornness is really neither here nor there. The bottom line is that it is costing them money.
In fact, if current online buying trends continue, online sales will outstrip regular retail sales within five years. Small business should take heed of this simple statistic because its implications are far reaching. With all hyperbole and exaggeration aside, we are rapidly approaching a time when businesses will not be able to compete without an online presence. The first and most important step to selling goods internet is to apply for a merchant service account.
What are they?
Whenever a customer chooses to pay with a debit or credit card, either online or in person, the seller must have a viable merchant service account. As the name implies, the bank or financial institution that issues these account provides a service to the seller. Most importantly, the provider checks the validity of the credit/debit card and then either approves or denies the transaction. If the transaction is approved, the provider sends a bill to the customer’s credit/debit card company.Once the requisite funds have been received, the provider deducts a small service charge and sends the balance to the merchant. The entire process takes two to three days.
Why are they Necessary?
According to a recent survey of U.S. retailers, six in every ten transactions were made with a debit or credit card. And when it comes to online sales, well over ninety percent of them are charged. In short, it is difficult to compete without a merchant service account even today. Five years from now it will be impossible.
How to Make Them Work for You
Because businesses are charged a series of fees for each transaction, a seller receives less money for each transaction than if the customer had paid with cash. One easy way to increase sales is to offer discounts for cash sales. Simply calculate the amount the customer would have paid with a debit/credit card and deduct it from the sale price.
Now, you may wonder why a company would do this if they had a viable merchant service account. And the answer is that it an easy and effective way to increase customer confidence.Simply offering shoppers a small discount on cash purchases will let them know that you are being square with them. Even if they don’t take advantage of the discount, your customers will appreciate your honesty. Sure, it’s a simple psychological gambit, but it can and often does pay off in the end. 메이저놀이터
There’s a reason why so-called e-businesses often have larger profit margins than brick and mortar stores. In fact, there are several. For one thing, a virtual business doesn’t have to spring for a large staff, a huge inventory, or even for a storefront. All they really need to run their company correctly is internet access, a reliable supplier, and a first-rate shipping company. The money they save on these costs can all be passed on to the customer. But how does this help small businesses?