How Using a Payment Processor Improves Efficiency
Successful businesses use technology to get more work done in less time. If you want to grow your business and control costs, automate the routine tasks you must complete.
Many business owners use accounting software and other applications, but you may not be using a payment processor to work more efficiently. A payment processor sends debit card and credit card payments from customers to merchants. Consider the steps required to process a customer payment.
How Customer Payments are Processed
Let’s assume that you own a sporting goods retailer, with both physical stores and an online sales operation. Here are the steps required when a customer makes a purchase with a debit or credit card online:
- Select item: The customer finds a baseball glove, clicks on the “buy now” button, and is moved to a checkout screen.
- Data entry: At the checkout screen, the client enters the card information. The customer is asked to confirm the item purchased, the card information, and the dollar amount, and the purchase is completed.
- Payment processed: The payment processor sends the sale price amount, less the processing fee, to the seller’s bank account. The processor sends confirmation of the transaction to both the buyer and the seller.
- Goods shipped: When you receive a payment confirmation, the baseball glove is shipped to the customer.
A similar process occurs when a customer uses a debit card or credit card in a physical store. The processors must also handle refunds, price corrections, and order corrections (amounts, sizes, etc.).
You can integrate your payment processor into other systems:
- Assume, for example, that a customer sends you a purchase order electronically. The client’s information can be loaded into the payment processor software, saving time when the purchase is processed.
- You can also transmit a bill of sale when you sell items.
- Sales data from the payment processor can be easily integrated into your financial reports.
You need a clear and efficient e-commerce system to generate repeat business. People continue to shift toward e-commerce, and you need to provide an electronic option to satisfy customers.
Trends in Customer Service
The 2017 American Express Customer Service Barometer reports several findings related to customer service:
- More than half of Americans have scrapped a planned purchase or transaction because of bad service.
- 33% of Americans say they’ll consider switching companies after just a single instance of poor service.
- Americans tell an average of 15 people about a poor service experience, versus the 11 people they’ll tell about a good experience
When you provide great customer service, you can pick up new customers who are dissatisfied with your competitors. Make the buying process easy, and you can increase sales.
Your payment processing system must offer some additional features:
- Software integration: The processor’s software should be easy to use. Ideally, you can copy and paste a line of code into your website.
- Mobile use: The processor’s software must be coded for easy use on a mobile device. Customers should be able to navigate your website, make a purchase, and pay electronically using a mobile phone.
- Foreign sales: Banks issue debit cards and credit cards, and your processor must process cards issued by US and foreign banks. The processor must be able to convert foreign currency transactions into US dollars.
- Fees: Technology costs decline over time, and a processor’s fees must be reasonable.
In addition, you need a processor that’s responsive, and will quickly follow up on problems. The service must include a 24-hour, live customer service line, so you can get help when you need it.
Ask the people in your professional network for a referral to payment processor. Once you have several companies referred to you, carefully review their website and set up a phone call. Ask questions, based on the information discussed above, so you can make an informed decision about hiring a processor.
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