Accepting Credit Cards Can Boost Your Sales Volume and Average Sale Amount
Accepting credit cards is a must in the modern economy. Checks are becoming tool of the past and are being replaced by debit cards and credit cards. As a business owner, you must accept credit cards to remain competitive and to satisfy your current customer base.
The average credit or debit cardholder has four (4) bank credit cards. The purchase volume that is handled through the credit card networks grows by about 15% per year. This pace is greater than purchase volume growth and means that electronic payment methods are replacing other payment methods such as cash and checks. In fact, debit card purchases are growing at a rate of more than 50% per year.
Some estimate that a business forfeits up to 80 percent (%) of consumer impulse purchases if they do not accept credit cards or debit cards. There is also an increase in the dollar value that a consumer is willing to spend when credit card payments are an option. Impulse purchases and a larger average transaction volume mean a healthier bottom line for a merchant.
People Use Credit Cards for the Following Reasons:
- Don't want to carry cash
- Save cash in hand
- Reward programs. Consumers want to gain rewards points to be used toward airline tickets, cash cards, or other merchandise
- Makes a large purchase easier to handle
- Earning interest on cash in a bank account or money market account
- Record keeping for business expenses
Credit Card Payments on the Internet
Credit card payments are the key to making e-commerce work. Without credit cards, online shopping and online payments would not be a possibility.
Here is an example of how people pay for purchases in an online store:
- Credit card online: 89%
- Credit card via phone: 7%
- Credit card via mail: 1%
- Check mailed: 2%
- Other: 1%
Clearly, the above demonstrates the necessity of accepting credit cards online.
The Future of Credit Card Payments
Research shows every indication that consumers view credit cards as a must in today's economy. In fact, unique applications are in development that will expand the application of credit card payment networks to devices such as the cell phone or PDA.
Younger customers' preference for credit and debit cards is clearer than that of older generations. This trend isn't likely to subside and is projected to cause check and cash use to fall dramatically.
Make sure you are accepting credit cards in your business. It is a low cost proposition and will have an immediate impact on your top and bottom line.
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