16 Nov The Risks of Running an All Cash Business
All cash business websites run the risk of losing customers to businesses that accept credit cards. Accepting cash only payments does help reduce the cost of a merchant account and credit card transaction fees, but a lack of convenience to the customer makes accepting cash only a poor choice for many businesses. Cash-based businesses generally only work well in a business like a coffee shop that have a high volume of sale with low per transaction costs. Some rural businesses also might benefit from using a cash-based only business. However, with cash, the business owner always assumes the risk of fraud, burglary and employee theft as well.
Review Your Business
Take an honest inventory of your business. If you currently accept credit cards, look at the percentage of transactions credit card transactions. A high number of credit card transactions could indicate that your customers could walk away if you stop your credit card processing service and start taking only cash payments. Merchant accounts do cost some money, but losing customers comes at an even greater cost. Keep in mind that you don’t always get a chance to talk to a potential first-time customer. Especially if you offer high-priced items, credit card processing could make the difference between a customer coming to you and going next door.
Payment Processing System
The very nature of an electronic payment processing system makes the funds in your business more secure than a cash-only company. Advertise to the world that you only accept cash and you open yourself up to the potential for theft and burglary. Cash-based business need to keep time-locked safes that can put the employees at risk in the event of a break-in or robbery. Employees that handle large amounts of money, especially when you sell a service or product may find ways to pocket the money. If you sell consumable products such as in a deli or a cupcake shop, an employee could mark out a product as expired or damaged, pocket the money from the customer and the business owner might not know about the left. With credit card transactions, the employee or robber would have nothing to steal.