By Drew Cementa, CEO of Tidal Commerce
Whether you’re a residential or commercial mover or work in industrial storage, getting the right payment system for your business might seem like a task that you can afford to leave on the back-burner as other priorities take over. However, many companies do not realize the benefits of a flexible yet sophisticated payment processing solution and how a bad one can leave you out of pocket in more ways than one.
This is especially true in the moving and storage industry. Valued at $12.6 billion annually, it’s comprised mostly of small businesses, which means these companies need to make sure they’re not losing money or overpaying in transaction fees as a result of an outdated payment solution.
Let’s take a look at a few of the essential components found in modern, cost-effective payment systems. Compare your own system to each component and see where yours succeeds or falls short. If you notice your system isn’t up to snuff, it’s probably time to upgrade or switch providers — a few seemingly minor changes in your payment solution can save you thousands of dollars over time.
Interchange plus pricing
While many moving and storage businesses might still be using a flat-rate or tiered pricing model, it’s likely in their best interests to swap to interchange plus pricing. Flat-rate pricing simply means there is a fixed percent per transaction and a flat fee, so typically something like 2.9% + 10 cents per transaction. Tiered pricing charges you according to the transaction type, with different types costing varying amounts. Keeping to these pricing models might make it simpler to work out how much you’re spending on transaction fees, but in the long run they can actually end up costing you more.
Interchange Plus handles transactions individually, determining the price according to the interchange fee charged by the card associations (Visa, Mastercard, etc.) and then adds a markup taken by your merchant services provider, e.g. .25% + 25 cents per transaction. Often times your average cost per transaction is less than the flat rate companies charge. So, Interchange Plus is likely a smarter choice for growing businesses, and can actually end up saving you money as you’re not paying a fixed rate for transactions that would otherwise be less with Interchange Plus.
These days, making sure your customers feel secure while using your payment system is crucial to running a successful business. A modern payment system that supports EMV will not only benefit your customers by offering a better, more secure experience, but it’ll also help you reduce fraud and chargebacks. EMV integrations used to be difficult and cumbersome for businesses, but recent tech has been this process much easier.
Payment flexibility matters
Opting for a payment processing solution that allows your customers to pay through their preferred payment type, either in-person or online, will make life easier for them and result in higher customer satisfaction levels for you. Offer your customers the option to pay by Apple Pay, Android Pay, chip, swipe, or contactless, and they’ll value the flexibility that many other companies might not offer. This works both ways, too. Taking payments on site after a job or offering easy payment plans online can go a long way for reducing efforts wasted on collections.
There are payment solutions out there that give you access to complete customer profiles, allowing you to double-down on your marketing efforts and understand how best you’ve served your past customers.
For example, with a comprehensive payment solution, you can look at individual contact profiles or in aggregate so you can understand why customers behave the way they do, which ones stick with you and why, find out your average storage lifecycle, and much more.
It also pays to go for a payment solution that gives you access to the big data picture. By gleaning insights from this data, you can hone in on individual service areas and target specific customer segments with hyperlocal marketing efforts. Or, for when you’re not sure where to focus your marketing strategy next, you can zoom out and compare real-time sales data from a combination of geographical areas. By understanding which markets, employees, or businesses are pulling in the most profit, you can better strategize going forward.
By getting access to these reports in real-time, you can also better manage chargebacks, settlements, and potential instances of fraud across your whole business.
While choosing an upgrade to your payment processing system, you should also consider what capabilities the solution has in terms of facilitating easy communication between you, your staff, and your customers. Going for a platform that lets you send direct messages to your staff, settle transactions from anywhere, or even let your long-term customers know that they’re due a discount will make sure everyone knows they can rely on your business.
Take a second to evaluate your communication with your current merchant services provider as well. Your provider should always be there when you need them. 24/7 technical support and active communication should be a given, but many companies sign contracts with merchants and walk away. The market is much more competitive than it was 15 years ago, and if you feel like your merchant services provider is unresponsive and antiquated, take the steps to find a better company that treats you like a partner.
Setting yourself apart from your competition by providing excellent customer experience through a modern payment system should be a no-brainer for the thousands of moving and storage companies that exist all across the U.S. By making sure your next service provider works with you and offers the extensive, up-to-date features that your business needs, you can be sure to boost customer satisfaction and maximize revenue streams.
Cover image: iStock