With card transaction fees constantly creeping up and small businesses looking to cut costs after a tough 2020, more business are choosing to add a surcharge and pass on the cost to customers. Others are holding off for fear of losing customers.
But should they be worried, or should they go for it? And more importantly, should you?
If you’re unsure about adding a surcharge, here’s some simple advice to help.
How to work out if adding a surcharge is right for you
1. Do some legwork
Visit other shops in your area and find the ones that surcharge. Ask them about their experience and if they have recommended surcharging to any other businesses.
We’ve found retailers who surcharge report saving thousands of dollars every year – and achieve that without losing customers.
“98% are happy to pay the surcharge. Customers don’t care as long as you provide good food and good service – that is what they want.”
– Kumar, Cafe Oliveto
2. Work out the cost of not surcharging
Take out a pen and paper and work out what not surcharging is costing you. Don’t stop at your bank fees either. Think about the time you spend reconciling confusing bank statements, the sales you might have lost because you didn’t offer a specific type of card, etc.
3. Consider how you might use any savings
An improved cash flow is just your starting point. Think how you might use these new funds. You might pay other bills and or use it keep prices down. You also might use it to attract more business by advertising, improving facilities or your products. One Smartpay customer even used the savings to invest in a customer loyalty programme.
4. Test it with your customers
If you really want to know if surcharging is right for you, then why not test it. If you go with Zero Cost EFTPOS, you won’t be locked into a contract, and you can switch back anytime (not that we think you will).
If you’re ready to find out more about surcharging and how it could help your business get in touch with the team today at Smartpay.
^Source: Reserve Bank of Australia