Decreasing your operating costs is vital to keeping your business competitive, but it can be tough to keep chasing goalposts that are always moving. There comes a point where you have to accept you’ve found the best practices for cost efficiency in a given area, but when you do, you have the opportunity to move on to seeking other ways you can trim extra costs without giving up the services your company depends on. When it comes to credit card processing, there’s no better way to reach full efficiency than to find a way to accept credit cards with no monthly fee. It might seem like an impossible dream at first, but setting up the program that eliminates credit card processing costs from your overhead is surprisingly easy. Combined with another cost-saving measure, it could eliminate all your POS operating costs too.
How To Make Cash Discounts Work
The first step to decreasing your processing costs is eliminating the cost to you when a customer runs a card or uses another electronic payment method. Since the law doesn’t typically allow you to mandate a minimum transaction size for card transactions in most situations, lower-dollar purchases can cost you more than you make. On top of that, even profitable sales are less profitable than they could be when you are paying out a percentage of the total transaction cost. The solution is to offer customers who pay with cash a discount.
To make this program work within the federal law authorizing its use by small businesses, you need to make sure your posted prices are the cost to credit card customers. You also need to make the fact that you have a cash discount program clear to customers on your signage, to give them the opportunity to participate by paying with cash. For the last piece of the puzzle, you need a POS that supports cash discount settings, like the current generation of the Clover Station. With all those pieces in place, it’s easy to pass savings on to customers when they pay with cash while adjusting your pricing to pass processing costs on to customers who pay by card.
Take the Next Step in Savings With Free Equipment
With a cash discount program in place, you’re also positioned to get upgraded equipment for free. It might take a little research and the right timing, but many processors offer free or discounted POS units with new processing agreements. Depending on the company, there might be a term contract involved. Other times, it’s a matter of a no-cost lease on equipment that must be returned if the service is stopped. Either way, it means finding a great upgrade like the Clover Flex for sale and getting it without dipping into your cash reserves. Then, because of the cash discount program, your cost for the actual processing is practically nothing. As a result, you could save as much as 95% of the cost of accepting cards, while enjoying some of the most sophisticated payment and staff management technology that exists today.
