In order for businesses to succeed in today's competitive market, they need to adopt a wide variety of payment methods to satisfy the specific needs of all the customers with whom they might interact. While one form might be good enough for a majority of consumers a company sees, if the enterprise isolates other buyers, it might be harder to expand in the future when revenue is coming from a single source.
As more shoppers move away from cash and into the world of digital payments with options such as debit or credit cards, small businesses need to take advantage of their accounting resources to handle the flow accurately and determine just how much they're making at the bottom line. While essential for commerce today, some of these newer methods, like credit cards, can restrict modest enterprises from expanding.
Shackling businesses with fees
Every time a customer swipes a credit card at a small business, the store incurs a fee depending on the type of card used to make the payment, according to the Financial Post. Around 2-3.5 percent of every credit card transaction made in Canada goes to the companies who issue them, resulting in approximately $7 billion of potential revenue lost.
When small businesses run in already competitive markets where every dollar counts, these fees could make or break a company. There's been an overall increase in the amount modest organizations have to pay for customers to use their cards with no clear method of challenging the process, but new legislation is currently being worked on by the national government that may grant a firm decrease in the fees for premium credit cards, which tend to have higher rates, added the source.
Canada currently has some of the highest credit card fees in the world, reported Canada Newswire. If the changes to the 2014 budget are successful, they may bring some much-needed transparency and accountability to the payment industry so small businesses can carry on servicing the communities in which they've become fixtures.
Shops free of costly chains
The Small Business Matters Coalition has thousands of members in the country and have pledged that upon a reduction in credit card fees, its business owners will be free to make some of their own changes to the way they operate, stated Canada Newswire.
If companies are free from the heavy charges, this will help them spur investment, encourage friendly competition, lower prices for consumers and create more staffing and recruiting opportunities.