This past weekend saw a big change in how we do business. For many years, our farm stand has been a cash-only business. We would also accept personal checks, but did not take credit or debit cards. However, sales were lost because of this. Local folks know to bring cash, as many small businesses in our area choose not to accept cards. But our area of northwestern Pennsylvania is rich in natural beauty and sees a lot of business from tourists & campers. Out-of-town visitors often take for granted that plastic is accepted everywhere. It was disappointing to both me and my potential customers when they had to put back things they wanted to buy because I couldn’t take their cards.
These days it’s becoming very easy for small businesses to accept cards. Gone are the days of expensive readers and high monthly fees. Also, cell phone service is becoming better and better, even extremely rural areas like ours are catching up and making it possible to do transactions. I looked into two readers- Square from American Express and PayPal Here. Both have readers that connect to most smartphones. Both have transaction fees just under 3%. While there were a few small differences, I ended up going with PayPal, because I feel they are a very trustworthy company, and I’ve been a PayPal user for many years as an eBay and Etsy seller. I opted to purchase the more expensive card reader that will also accept chip cards and wireless payments (like Apple Pay). It has a pin pad and connects wirelessly to my phone via Bluetooth, without needing any further equipment, and the PayPal Here app is free to download.
After setting up, I also discovered a huge benefit to the chip card reader is that all transaction funds are immediately available. With the free reader that plugs into your phone’s jack, you have access to the first $500 immediately, but any further sales in a 7-day period are held by PayPal for 30 days. I had also gotten a PayPal debit card some time ago for instant access to my online earnings. Although it goes into a separate account than the farm checking account, I have the ability to spend the money online or at local stores as soon as the transaction goes through.
When deciding to take cards, Dan and I discussed whether or not to add a surcharge or a minimum for card transactions. We decided to go with $5, at least as a starting point. Since there is a $.30 fee per transaction along with a commision, setting a minimum seemed reasonable. On the other hand, even though it can be a little aggravating to go through the process for a $5 sale, it very well may be a sale we would not have had otherwise. And as PayPal’s cut is $2.90 in commission per $100 spent, we feel that we will easily make that up in increased sales without tacking on any kind of surcharge for card sales.
I was a little nervous that the first day I was set up to take cards was July 1, the Saturday of the weekend closest to the Fourth. Big holiday weekends mean lots of seasonal visitors and busy days that can border on hectic. Adding a new way to pay involving new technology seemed like it could really slow down the checkout process, but it could also lead to more sales. It turned out to work very well. The format is pretty user-friendly, and my first few card customers were more than patient when I explained I was new at using this little machine. I even have the option to email or text a receipt to the customer at the end of the transaction. My biggest disappointment was that the customer is prompted to sign on my phone’s screen rather than keying a pin into the PayPal machine. I was hoping they would not have to touch my phone at all!
At the end of the day, I had done a number of transactions on the card reader. About a third of the total sales for the day, in fact. While it’s difficult to say for sure how much was income that we would not have had if were were still accepting cash only, I do think it made a difference. Many first-time customers stop with a small amount of cash, expecting just produce, and don’t have the cash to pick up a handmade fire poker or a necklace or a number of lamb chops. Now they can! I am glad we finally made the leap, it was not as complicated as I feared, and I think it will be a boon to our bottom line.