Credit Cards Provide Financing Option, Help Close Sales That Typically Get Away

Looking for a great way to increase your business by making it easier for potential customers to become actual customers? Two words: credit cards.

What’s in it for you:

• Increase the closing rate of your sales by becoming more affordable to more people
• Get the sale now instead of later
• Eliminate collection problems (the bank that issued the card will pay you in full for the work done, it is up to them to collect the balance from the customer)
• "Sell up" to better quality products (and sell add-on components like a remote control) that can earn you increased profits
• No paperwork to deal with
• Customer payments calculated automatically
• Improve cash flow on service by keeping credit card numbers on file (and/or collecting at time of service)

What’s in it for your customers:

• Get work done by a better contractor instead of simply settling for the lowest bidder
• Have the option to purchase now instead of waiting
• Get airline miles and other types of promotional bonus points in incentive programs
• Low introductory APR can be competitive with other forms of financing
• No paperwork for homeowners, unlike home loans or other financing

Many contractors currently do not accept credit cards, possibly because they assume it may be too much of a hassle to deal with. In reality it’s very much the opposite. Setting up a merchant account with a bank is simple. A bank will want to determine such things as your projected monthly sales volume, the average amount per transaction, how long you've been in business, what kind of credit rating you have, and what cards you want to accept.

From there, they will set your fees for doing business with them (and, because your customers will all pay in person, you will have a 0% "cardholder not present" rating, ensuring you the lowest fees possible). Typical accounts cost a few hundred dollars to open and include statement fees of $10-20 per month as well as fees of less than 50 cents per transaction.

You can pass along to your customers any of these recurring fees that you incur simply by building in a minor credit card fee to all your bids.