Making sense of the credit card process: a simplified overview for B2B companies
B2B Insights: Understanding the Credit Card Process
Maybe you’re a first-time small business owner. Maybe you’re a controller for...
How does PayTrace improve merchants’ cash flow?
By speeding up the payment process, PayTrace accelerates your access to funds. And by automating processes, your day-to-day business flows more smoothly.
Positive cash flow in healthy businesses generally expands over time and enables you to grow your company. But when a business spends more than it earns, help is needed. Very often, this predicament, known as negative cash flow, is caused by slow customer payments, lengthy collection practices, and unmanaged spending.
Look, if you’re like 60% of small businesses who report regular cash flow issues – you know it’s no fun struggling with fluctuations that make it difficult to plan for the future. Case in point, 40% of businesses say that cash flow has restricted their business growth.1 So, don’t get stuck waiting for payments. Ensure you have a steady flow of funds by following these five key pointers to increase your company’s cash liquidity.
1. Take a closer look.
What can you do if you find that you’re regularly experiencing negative cash flow? Well, a couple of things come to mind right away. First, investing in marketing could bring in more revenue, or secondly, you could cut costs. It’s pretty clear to most folks that the less you pay on labor, production, supplies, and rent – the more cash will be on hand. Having access to liquid assets generally helps a company be more secure. With a good supply of green in the bank, you can feel more confident making plans, taking risks, and experimenting with new offers. Now, if your costs are fixed and marketing’s not working, try taking a closer look at your revenue collection practices. These questions are a good place to start:
- Do you accept in-person payments at the point of sale?
- As a merchant, are you accepting payments online or over the phone?
- Have you looked into B2B payment services to fuel your business?
- Could you offer online billing and payment processing to receive cash faster?
2. Find a partner. Wanna go steady?
PayTrace enables merchants to accept cards at point-of-sale, online, over the phone, and in person. If you’re ready to add digital payment solutions to your offerings, we’re here for you. Our services will accelerate your access to payments. We help you build a better payment workflow with a platform that includes payment gateway and payment processing. Our secure environment is PCI compliant, so you have less liability. And our 5-star support is legendary.
3. Collect receivables promptly.
In most business-to-consumer merchant scenarios, you can collect payment at the point of sale. But if you’re talking business-to-business transactions, that isn’t always the case. If it’s customary in your business, you may look into collecting deposits up front. Additionally, it’s key to establish a schedule (“net 30” is often the norm) that requires accounts receivable customers to pay their bills by a set date. You can offer discounts for quicker payments. And you can charge penalties for late payments. You’ll need to be diligent about taking action when bills go unpaid past your invoice terms.
An instant way to decrease your Days Sales Outstanding (DSO), the average number of days it takes a company to receive payment for a sale, is to replace mailed invoices with e-invoicing. With an online e-invoicing portal, you can easily check and know the status of invoices in real time. Boosting visibility into the payment process in this way helps you make more informed decisions. You can better forecast, brainstorm how to increase efficiencies, and look for ways to save even more time collecting accounts receivables.
4. Consider B2B payments to get swifter access to capital.
When you accept credit cards, mobile payments, and electronic payments such as Automated Clearing House (ACH) and Electronic Funds Transfers (EFT), customers are more likely to pay online.
Why? It’s easy and it’s convenient – in fact, the majority of finance leaders claim that the top reason they started offering digital payments was to make it easier for their customers to use.2 When using their business credit card or bank account, your customers will in turn get an instant electronic record they can use to audit their expenses.
On your end, B2B electronic payments reduce the time, cost, and effort it takes to mail out invoices and to then receive the proverbial “check in the mail.” With digital payments, you also get many steps of the billing/revenue collection process streamlined. For instance, the reconciliation process requires far less time than what’s needed to reconcile paper checks with invoices.
PayTrace accelerates your access to funds. By digitizing payments and removing manual processes, we save your accounting team lots of time, reduce chance of error, and give you swifter access to capital.
5. Qualify for the lowest rates with PayTrace.
Interchange is a rate or fee charged by banks to cover the cost of handling and risk involved in bank credit or debit card transactions. These fees are set by the credit card networks.
On our platform, merchants qualify for the best interchange rates on every transaction.
Our omni-channel solution for secure payments is available online, in-office POS, and through any mobile device. Even merchants accepting payments through common accounting software, CRM, and ERP applications connecting to our API are saving with interchange optimization for every qualified transaction.
Ready for a positive cash flow? Get in touch – we’re here to help.
1 Intuit, “The QuickBooks Payments and Cash Flow Survey,” May 2021.
2 versapay.com/resources/digital-payments-are-ready-for-the-spotlight
