Why payment choice will help cash flow and increase SOW (Share of Wallet)

Customer A is on a subscription plan for $20 per month for a term of 16 months, that auto-renews for 12 months all by Credit Card.

Customer B pre-pays that same subscription by ACH and then has their auto-renew on a credit card

Customer C does a different plan but prefers to pay by wire transfer

Customer D likes to pay by check, quarterly

Customer E has a subscription but also buys an accompanying product and has ordered $200 but now orders $350 through a buy-now-pay later option

What do all of these customers have in common?

Choice, the ability to pay how they want, when they want and with the flexibility to change that payment method on their terms.

1. Businesses that accept multiple forms of payments and combinations of them are:
2. More likely to get paid quickly
3. More likely to retain customers
4. Less likely to have an abundance of overdue invoices
5. More able to control cash flow 

Your reaction is “How can I track all of this with my current invoicing, payment and accounting system?” The answer is, you might need to look at a more flexible solution as well as different payment processors. 

It becomes even more complex if you are a multi-country business. There are tax laws, VAT, some payments options only available in certain countries, etc. 

The solution is a flexible platform platform that sits outside of your existing inflexible system or one that can potentially work in tandem with your current system. Paycove is a good example of such a system. It can work with your existing CRM and accounting system. It can via partners and integrations, add new forms of payment and in some cases, integrate with your existing solutions. 

Why would I want to do this? 

1. Increased SOW (Share of Wallet) is the first reason. If you offer more choice, chances are customers will spend more with you. What I hear is that customers spend between 25%-178% more when given choices and options. 
2. Better cash flow is the second reason. 
3. Ability to control how, when and where many of the fees are charged. Do customers absorb costs for some payment types and terms? Are you willing to take more risk? Do you need a buy-now-pay-later option where you get the cash now and don’t have to worry about the “what if a customer doesn’t make all the payments?” Do you need bundles or a down payment and structured payment plan? Do you need to adjust offerings based upon your cash flow?

Does this give you a competitive advantage?

Yes, as so many companies are stuck in the mindset that “our customers like to send checks once a quarter or pay by credit card every month.” Yup! They do because that’s the only option you have ever given them or they don’t even know they have a choice. 

A great example is a business owner who stated,

“Nobody will do online wire-transfers, they all like to send us checks.”

The reality was that 80% of their customers would rather do a wire-transfer and speed up delivery of their product. And 10% more wished to do credit card transactions. That left them with only 10% who “wanted” to send a check.

So if you would like to explore ways to increase your cash flow or Share of Wallet. Contact us or start a free trial to see how Paycove can help accelerate your business.