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Running a salon is a great business idea given the high-profit potential and the exciting nature of work. You’re actually responsible for the looks of numerous professionals across every other industry. Lawyers, doctors, engineers, musicians, students, and even celebrities may pass through your hands. Your job is to see them look neat and presentable. And after you’re done with a client, you need to get paid to recoup your expenses and pocket the profits.
So, what are the available payment processing methods you can choose from? Which one is the best? What are the pros and cons of each?
Follow closely up to the end.
Payment Processing Methods For Your Salon Business
1. Credit Cards
Nearly every person carries a credit or debit card with them. These have been around probably since before you were born. Your mum and dad probably used them, too. There are concrete reasons behind this popularity. Here are some of the reasons why billions of people use credit and debit cards:
- Carrying cards are much safer than carrying cash
- Credit cards can help you build your credit rating
- They allow you to earn reward points whenever you spend
- You can apply for a chargeback if you change your mind about a product or service
- They allow you to make payments in any currency
- Credit cards allow you to borrow some cash during emergencies
- They allow you to make online orders easily
Even so, they’re not without their disadvantages. Some of the major cons of credit cards are:
- High rates of interest
- High payment processing fees
- Possible overspending due to impulse buying
- High annual or monthly maintenance fees
- Missed payments can negatively affect your creditworthiness
- Potential of falling prey to fraudsters
- The need to always have a card swiper
Of all the disadvantages mentioned above, high credit card processing fees are probably the most painful to you. You see, for every payment a client makes, you lose any amount between 1.3 and 4%, and sometimes up to 5%.
That considerably eats into your profit. But fortunately, it’s now legal to pass the processing fees to your customers through a credit surcharge program. Instead of them paying, say, USD$100 and then USD$5 gets deducted from your revenue, they pay something like USD$105 so that you keep the total USD$100. Sounds good?
Yes, you should mean business! Every cent counts. If that’s something you’d want to pursue, you can try this out.
Old is gold; so, it seems! No matter what technology comes, many people still pay for services using cash. As a hairstylist, yours is to be flexible enough to accommodate as many forms of payment as possible so that you don’t drive away potential customers.
People prefer cash because of the following reasons:
- It has the potential to reduce overspending since there’s nothing like overdraft
- It’s accepted by nearly every business
- It’s anonymous since you don’t have to provide any personal information
- Free of maintenance and processing fees
- It’s more emotionally painful to see your notes go one by one, and so you’ll subconsciously limit your spending
- It can be used in emergency situations such as during power outages
- It helps keep debts at bay
Also, for you, it’s pretty easy to get those much-awaited tips from clients. For the disadvantages:
- Carrying cash is risky as you can accidentally lose your bundle of notes or fall prey to robbers
- As there’s no reference information when paying through cash, it can be challenging to track your cash spending.
Moving forward, treasure cash payments for what they are, but remember to beef up your security just in case prying eyes are salivating at your salon fortune.
This is another old yet beneficial method of payment. It’s not very common for individual clients as people rarely walk with checkbooks. However, those who make bulk orders can comfortably pay you using a check.
Think of a group of bridesmaids doing their hairs for a forthcoming wedding or a team of actors getting ready for a video shoot. Their bill can total thousands of dollars, and the company in question or persons in charge decide to write you a check.
All you need to do after you get the check is deposit it at your bank and wait for two to three business days for the payment processing to get completed.
Here are some of the benefits your clients enjoy by paying through checks:
- In case they’re sending cash in advance or afterward, it’s easier to send checks by mail than cash
- Checks help with record-keeping
- Checks are a suitable proof of payment in case of disputes
- Some types of checks can be cleared almost immediately
- It’s a more secure method than both cash and card payments
And the shortcomings of checks include:
- Not all businesses receive check payments
- Writing checks is more time consuming than swiping cards or paying in cash
- Most banks charge fees for using checks
- Potentially open to fraud since any person handling the check gets access to the issuer’s account number, name, and contact information
- Checks do bounce when the issuer’s account has insufficient funds
Last but not least, the most modern payment method is popularly known as e-payment. You can call it electronic payment if you wish. What you need is an online account with any reliable electronic payment processor.
Your customers can transfer any amount of money to your e-wallet. After that, you can use the cash to pay for other online transactions or transfer the funds to your credit card.
It’s a speedy payment method and people like it for that. It’s handy if you do many online transactions. You can pay bills and order goods online without ever physically touching your cash.
The Bottom Line
You really need to be flexible and accept several forms of payment. Your clients’ tastes and preferences may significantly vary. It would be unmindful of you to restrict them to only one payment method. Show them some love and inclusivity by accepting whatever payment methods they use, whether cash, cards, checks, or e-payments.
So this was it for today, I hope you have enjoyed reading Payment Processing Methods For Your Salon Business Helpful. Let me know your thoughts in the comments below.
Have a Good Day!
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