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Cooling Off
by Bob Osgoodby
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Those with a "brick and mortar" business, quickly learn
that there are two types of people they will meet in their
store. Those who can afford to pay for the goods and
services, and those who can't. Now that seems simple
enough.
Someone who leaves the store without buying, because they
couldn't pay now, will seldom be seen again. Sure, some go
to an ATM, withdraw the cash and return, but they are the
exception rather than the rule. Others will write a check,
but there are people who can't afford, at this moment, to
write a check either. If you can't close a sale when they
are ready to buy, they have time to cool off, and you will
most likely lose the opportunity.
The same holds true on the web. If you can't close when
someone has made up their mind to buy, you will probably
lose the sale. Now there are several methods of accepting
payment on the web. One is to have them send you a check or
money order. They have to write out the check or get a
money order, and time passes - in other words you have lost
the immediacy of the moment.
Many people buy on impulse, and if you provide a convenient
way for them to pay for the purchase, you have a better
chance of making the sale. This can take several forms on
the web, and let's talk about just two.
Many online business barely make expenses when starting
out. As you get known, it will increase, but after awhile
will level out. You are losing the impulse purchases. Once
you install online checks, your business should immediately
increase.
Obviously the online check submission has an effect. But,
you can then expect your business to level off again, even
though it will be at a higher level than before. Realize
that people will not submit a check online if they are
tight on funds.
Some people will write a check or submit one online,
knowing they don't have sufficient funds to cover it. Yes
this is illegal, but there are those who will do it hoping
to get the merchandise.
Those that do are fairly comfortable in the fact that it is
usually not worth the merchants time and effort to
prosecute, and they will simply write it off as a bad debt.
While the number of bad checks you get will be low, you
should take the next step.
It is now time for you to acquire merchant status and be
able to accept credit cards. People can now make the
purchase knowing they have 30 days to make payment. If they
were financially tight at that point, they could make a
minimum payment, but still have the advantage of making
their purchase now. At that point, your business should
take a huge jump.
If you are doing business on the web, and selling either a
product or a service, and feel you just can't afford to get
a merchant account, it is costing you lost sales. Sure,
there are upfront costs to become fully operational with
online checks and a merchant account, but you will recover
that very quickly.
But I have to have a "secure site" to accept these you
might think, and you are right. You can do this in one of
two ways that make sense. You can contract with a company
that provides web space and get a "secure site" from them,
but this requires a knowledge of HTML coding. You also have
to manually enter the credit card information, and you have
little defense against a disputed claim, and may have
"charge backs".
A second way is to set up a shopping cart. This is probably
the best way to do business online. You don't need a secure
site of your own as the company providing the shopping cart
does. An added benefit is that the customers enter the
information themselves and their "IP" address is
automatically captured. If the credit card is declined,
they can immediately enter another.
You are only notified when there is a successful
transaction. The customer is automatically sent a receipt,
so the chances of a charge back are significantly reduced.
If you don't have merchant status, you should at least
consider "Paypal" which is probably the easiest and
cheapest way for small businesses and websites to accept
payments online. There is also a shopping cart available,
but does require basic knowledge of HTML. "Paypal" is a
viable solution for a small business. The only drawback is
that your potential customer has to sign-up with "Paypal",
and "jump through a few hoops". This does risk "cooling
off".
If you find a way to close the sale when the customer is
ready to buy that works for you, your online business will
prosper.
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