For anyone who engages in the Merchant Cash Advance procedure to raise funds for their business relies heavily on high credit card sales to ensure early repayment of the loan from the cash advance lender. Even though the repayment schedule and amount is generally adjusted to match the volume of credit card sales, it is to the benefit of the small business owner to repay the lender as soon as possible.
Therefore, not only increasing sales, but specifically increasing credit card sales should be a high priority for a small business owner who has accepted a Merchant Cash Advance. There are several ways in which the small business owner can encourage its customers to make transactions using their credit cards.
- Special Discounts For Those Using Credit Cards
A very simple method is to provide monetary incentives to the customers to use their credit cards. All customers shopping a minimum of X monetary amount can be provided with a 10% discount on the transaction, for example. Different discounts can be set for different transactional amounts. However, this should be done carefully and cautiously. Discounts should only be provided if the business owner perceives that this will realistically conducive to increasing sales and should be discontinued as soon as a loss is perceived.
- Special Gifts For Those Using Credit Cards
Apart from monetary incentives, the business owners – depending on the type of business – can also provide physical incentives in the form of gifts to those using credit cards. For transactions reaching a certain amount, the business can offer free services or products. For example, a spa can offer a free massage to those who spend an X amount from their credit cards; a restaurant can offer a free meal or a free bottle of wine for higher purchases. Such complimentary giveaways will not take away from the credit card earnings and can psychologically force customers to make more credit card purchases.
- Increased Online Presence
For any small business, maintaining an online presence is a must, especially in this day and age. But apart from the marketing benefits of reaching out to more people, this online presence can also enhance the sales. By making products or services available for purchase online (using a credit card only of course), a new segment of the market can be tapped into. This segment will be making transactions solely using credit cards and boost those sales. Maintaining an e-store is a beneficial investment as well as advertising the online purchasing aspect on social media sites.
- A Credit Card Loyalty Programs
Loyalty programs usually encourage customers to make more transactions as they receive points on every purchase which can be redeemed later on for complimentary products or services. A small business should definitely look into starting up a loyalty program; this will not only help in maintaining a strong customer base but by targeting a loyalty program for those who use credit cards only can help in boosting those particular sales as well. However, this should be analysed carefully before implementing; the business owner should figure out if there are enough loyal customers before investing in this program. The program should award a certain amount of points to a certain amount of monetary transaction via credit card. But to differentiate it from the general discounts and gifts on credit card purchases (if that is also in place), the redeemable rewards for the loyalty programme should be more valuable.
Boosting credit card sales seems quite a hassle, especially for a small business that might already be struggling to raise sales in general. However, both these strategies can go hand in hand to help raise the amount of money brought in. Naturally, for a small business owner who has been funded via a Merchant Cash Advance, it makes more sense to focus specifically on credit card sales as well so as to pay off the loan as fast as possible.