Every service-based business has its ebbs and flows. You might be slammed one month, and another might feel like you live in a ghost town. From a revenue standpoint, one way to weather these kinds of cycles is by incorporating retail sales into your business model.
In fact, many service-based businesses are starting to venture into retail. Whether you own a restaurant, vet’s office or gym, merchandise and other product sales can bolster your core business and even help you bring in customers you wouldn’t ordinarily reach.
Not sure if you’re ready to expand your business? Consider the following ideas for inspiration.
Complement your core business
As you begin supplementing your business with retail sales, your first goal should be to target your current customers. They already trust your expertise, so build on that. If you’re a plumber that swears by certain products, let your clients purchase those products directly from you. If you operate a veterinary clinic, why not sell your recommended pet food and toys in the waiting room?
By diversifying your business model, you not only bring in extra revenue, you also provide value-added services to your current customers, which can boost their satisfaction and keep them coming back.
Expand your offerings
To attract new customers you haven’t been able to reach before, think outside of the box for items that could draw a broader range of people. If you run a gym, take the leap from selling health-conscious snacks to gym clothes and athletic equipment. If you run a salon, take a step beyond hair into skincare items and cosmetics.
Even if these new customers don’t purchase your core service, you’re building a relationship with them. They may be interested down the line. The point of expanding your offering is to bring in new customers you wouldn’t ordinarily reach.
Your physical business location isn’t the only place you can sell your products. Your website can be a valuable tool to gather orders, reach a broader range of customers, and even drive foot traffic. You could also use one of the popular eCommerce marketplaces to sell your products.
By selling these products online, you allow your customers to purchase from you anytime and anywhere. You’re also able to continue doing business even after you have closed your doors for the day or over a holiday. Greater accessibility is great for extra sales.
Expanding your business can be scary and exciting. Keep in mind that you don’t have to do it all at once. Start small and see how it goes. You can always scale up or down, depending on performance.
eCommerce sales are on the rise, and smart small business owners are taking advantage of the trend. But growing your business online comes with its own set of risks.
For example, hackers are increasingly targeting small businesses because they usually do not have the resources or know-how of large corporations,1 and if your small business suffers a data breach, our recent study shows it could cost you almost 30% of your customer base.2
The bottom line: If you are in eCommerce, you should be thinking about the risks, and that means you should have a working knowledge of how your website handles fraud and sensitive payment data. Here are two questions you should be able to answer.
1. Are your fraud filters turned on?
Your eCommerce payment gateway gives you access to the payment network that connects major financial institutions, credit card brands, customers and other businesses. It’s what enables you to near-instantly verify that potential customers have the funds available to complete their purchase on your website.
Unfortunately, criminals and fraudsters also want access to that network for a number of reasons. One of the more common reasons is to verify stolen credit card information. They’ll initiate small transactions of $1 or $5 looking for approved transactions—sometimes hundreds at a time when they use automated bots. When they verify a card is active, they either sell the information to others or use it to place fraudulent transactions elsewhere.
If you’re subject to an attack like this, you’ll be responsible for dealing with cardholder complaints and managing chargebacks and associated fees, which can add up to thousands of dollars fast.
Most eCommerce gateways come with many fraud filters and tools that help protect you. Velocity filters enable you to set up maximum and minimum transaction amounts and volume per card; address verification helps ensure billing and shipping data align; and implementing CAPTCHA on your website can help prevent the use of automated bots in the check-out process. It’s important to verify that these tools are turned on. Otherwise, they’re sitting there idle, leaving you unprotected.
If you are an eCommerce client with Bank of America Merchant Services
To check that your gateway’s filters are activated or to configure them to better suite your business, log into your payment gateway and navigate to the fraud and security section. If you have any questions about your gateway or your fraud filters, please call 888.648.2649 for information about Authorize.net or 855.448.3493 for Payeezy.
2. Where is your payment data stored?
Taking payments online means storing and transmitting sensitive card data across the internet. There’s no way around it. But how your site is set up to collect card data can help protect your business and your customers from cybercriminals.
Most small businesses rely on what’s called the URL Redirect Model. Based on this model, your eCommerce payment gateway redirects customers off your website as they progress through the check-out process. By the time they get to the point where they’re entering sensitive payment data, they’re on a page hosted by your shopping cart or gateway provider. Because customers enter their credit card information on this third-party page, their sensitive data never enters your system, which may help protect you and your business.
It's still important to ensure you use a qualified third-party integrator/reseller for your POS environment to help protect your clients’ payment data. And if you operate a loyalty program, rely on automatic recurring payments for things like gym membership fees, or use some other data collecting tool that stores customer information, your system may still be vulnerable. Double check that any and all of your services and tools follow appropriate security standards.
If you are an eCommerce client with Bank of America Merchant Services
We suggest that small businesses in the eCommerce space regularly ask themselves, “Can I afford the substantial financial hit and headache of dealing with fraud and/or a data breach?” If you’re new to taking payments online, take preventive action as soon as you get your eCommerce payment gateway. If you’ve been in the space for a while, reassess your fraud and data breach prevention measures regularly.
How do you keep customers' attention? Even if you offer great services and products, competition can be intense, especially when you’re battling larger companies that have more advertising and marketing resources.
Many small businesses are turning to loyalty programs. In fact, 54 percent of consumers say they’re more likely to shop at a small business that has a loyalty program than one that does not.2 Pretty enticing, right?
As you think about creating your own loyalty program, or reevaluate your existing one, here are a few tips to help make sure you’re as successful as possible:
Watch a recording of our recent retail management webinar and learn how to tap into the hidden potential on your shelves.
Sign up for a new webinar to learn how to set up an online store and sell your products on the Internet. Hosted September 18 at 3 p.m. ET.
In each issue of Small Talk, we answer some frequently asked questions from small business owners like you. Read on. You may learn something new.
Q: How can I save time managing my employees?
A: Of course. Managing multiple employees across shifts while also tracking time off, hours worked and everything else can become a headache if you do it all manually. Most modern point-of-sales systems provide access to a variety of business management tools, and employee management is a big category.
You’ll be able to find helpful scheduling software, time clock functionality and even team communication tools. While some of the tools are free to use, you may have to pay an added fee every month for advanced access. You just have to weigh the pros and cons of that added cost to the time savings and convenience you’ll gain.
Q: I’m having a hard time keeping track of sales taxes. Is there a simpler way to do this?
A: Absolutely, the whole process can be completely automated, with money set aside on a daily basis to ensure you’re meeting your tax obligations. There are a variety of software options available. You’ll simply have to link your POS system with the third-party application, then connect your bank account if you would like the application to handle the funds directly.
Some tools can reconcile your sales, prepare your tax returns and file and pay your taxes on time and in full. It’s a truly hands-off approach. You may be responsible for paying their monthly fee. It’s another one of those situations where you’ll have to weigh your sales volume and time commitments to see if it’s worth it for you.
Is your social media feeling a little stale? Download this handy promotional calendar for creative new promotional ideas!
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