The COVID-19 pandemic is reshaping almost every aspect of society, including payment behaviors. A growing number of businesses and consumers across the globe have stopped using banknotes, fearing the spread of COVID-19 via paper money. A survey conducted by Travis Credit Union which polled more than 2,000 Americans found that nearly 60% want to stop using cash and favor payment systems due to coronavirus concerns.
Even before the pandemic customers were increasingly shifting to credit card, debit cards and supporting technologies like contactless and mobile payments. This trend, now accelerated by the pandemic, elevates the business case for commercial construction and renovation companies to accept credit cards. Furthermore, research shows that customers are inclined to spend more when using a credit card, offering the opportunity for the business to sell in a larger project.
Currently, many contractors use finance companies that offer credit to the end-user for payment. While this is certainly a valid way to accept payment, it presents some pain points. Interest rates for these programs can range from single digits to loan sharking, depending on the credit-worthiness of the customer. The finance companies also take a cut from the sale amount out of the proceeds paid to the contractor. This can put both the customer and the firm in a position of paying tremendous, unnecessary fees and interest. Accepting credit cards allows construction firms to provide a better client payment experience by making it easy for them to pay the way they prefer. This not only makes clients happy, but benefits the construction company in terms of speeding up payment and improving cash flow.
In making the leap to credit card acceptance, construction and renovation companies should partner with a credit card processor that can eliminate concerns over issues like costly investment in equipment, being locked into a long-term contract and fluctuating fees.
All credit card processors are not the same. Construction and renovation firms should look for a merchant services provider that offers:
- Flexible terms that do not require long term contracts
Construction companies should beware of credit card processing companies that
advertises free equipment. It is more than likely that a long-term contract is attached to that “freebie” equipment. Look for a merchant services partner who doesn’t believe in locking clients into long-term contracts and a partner who wants to earn the firm’s business with every interaction.
- Low processing costs
A cash discount program provides firms with a way to remove the stress of an unpredictable monthly bill for the business. For example, payment processor VizyPay created its unique approach to cash discounting by offering unlimited processing for one flat, low monthly fee. Their solution can eliminate up to 100% of credit card processing fees, allowing construction and renovation firms to put more money back into their businesses to fund growth. Under this type of program, firms won’t have to contend with rate and fee confusion or worry about processing bills that progressively become more expensive as a result of bi-annual rate increases. Furthermore, the customer benefits by receiving a discount if they choose to pay in cash.
- Customer benefits
When considering a payment processor, it’s important to determine how it will benefit the firm’s customer too. As mentioned, with the right cash discount program, a customer can receive a small break for using cash, leaving them feeling rewarded. At the same time, there are still benefits to using a credit card—a larger purchase can reap high rewards points (depending on the card provider) and the flexibility to break up the payment over time. Either way, it’s a win-win for the customer.
- Superior customer service
A good credit card processor will always be one with exceptional customer service. Look for a credit card processing company that has a reputation for providing superior customer service. Construction and renovation companies should not compromise on customer support in favor of ease of signup and sleek technology. Before selecting a provider, firms should test out the provider’s customer service by giving their support line a call. A long wait time can be an indicator of poor customer support.
- Mobile payment capabilities
Mobile payment solutions allow firms to accept credit card payments wherever they are – from the office to the job site and anywhere in between. Many contactors conduct business outside of their physical office, which can be a hurdle when accepting credit card payments. If a contractor has a fleet of technicians that are getting paid on location for a completed project, chances are, they are calling in credit card info to the office. The office staff, in turn, is hand keying the numbers into a terminal which drives up the cost of each transaction. By utilizing a mobile swipe machine, the contractor can conduct the transaction on the spot, and dramatically reduce the cost of processing.
- Additional services
Additional services offered by credit card processing companies can be a value add for construction and renovation firms. Some of these services include:
- Electronic invoicing capabilities – electronic invoicing allows construction and renovation firm clients to securely pay through an emailed invoice and allows firms to keep track of their payments in real-time.
- Contactless card payment capabilities –credit card terminals with the ability to accept contactless or mobile payments like Apple Pay®, Android Pay®, Samsung Pay®, and Google Pay® are quick, secure, and contact-free – all critical features in the COVID-19 business environment.
Commercial construction and renovation companies, like many companies navigating through the economic fallout from the pandemic, are looking for ways to improve cash flow and increase efficiencies. Accepting credit cards can help companies do just that while meeting client expectations for frictionless, contactless and mobile payment experiences.
About Austin Mac Nab
Austin Mac Nab is CEO, co-founder and executive leader of VizyPay, a West Des Moines, Iowa-based provider of payment technology solutions for businesses across the U.S. Mac Nab has been in this role since April 2017 when he co-founded the company. Mac Nab, an expert in the payment processing, bank card and retail industries, is responsible for overseeing the company’s strategy and running the day-to-day business operations. Since co-founding VizyPay, the company has experienced consistent triple-digit revenue growth, going from $96,000 in 2017 revenues to a projected $8 million plus this year. Prior the joining VizyPay, Mac Nab was executive director of San Rafael-based Central Payment from 2006 to 2017; regional manager of Card Payment Solutions from 2004-2006. Prior to that he was in management roles for retailers GameStop and Best Buy.