Managing cash flow at your company can be a tricky task. For many small business owners, it’s challenging to maintain consistent revenue. This is what makes the concept of recurring payments such an effective sales strategy. The payment model allows businesses to automatically charge customers at regular intervals. We’re talking weekly, monthly or annually. As a result, business owners don’t always have to initiate transactions manually.
Here are three benefits of setting up recurring payments for your business:
1. It ensures a steady and predictable cash flow.
As we noted, recurring payments enable you to count on a consistent revenue stream. Instead of relying on one-time transactions or unpredictable customer purchases, you have a reliable source of income each billing cycle. This is important because predictable revenue makes it easier to budget for expenses like rent, payroll and inventory. As well, it reduces the risk of cash shortages, helping with long-term financial planning.
“Recurring payments provide a reliable and consistent revenue stream,” affirms Andrea Herrera of TechnologyAdvice, “This predictability allows businesses to better forecast their financial health, manage budgets, and plan for future growth. Knowing that a certain amount of revenue will be received regularly helps in maintaining a stable cash flow, which is crucial for long-term sustainability.”
2. It increases customer convenience.
As a customer, don’t you appreciate hassle-free payments? When payments are automated, your customers won’t have to remember to make payments manually each month. This reduces the chances of service interruptions or late fees. Recurring payments also boost customer satisfaction since the payment process is so effortless. They help to reduce churn rates. This means that customers will be less likely to cancel when they don’t have to actively process each payment.
“Recurring payments work by allowing customers to set up their own billing schedule,” reports PressReach, courtesy of The Globe and Mail, “(This) means that they can pay for products or services in advance as often or as infrequently as they want without having to worry about forgetting or being charged late fees by the credit card company if they fall behind schedule in making their payment.”
3. It saves time and reduces administrative work.
If you have ever manually processed invoices, you know how time-consuming it is. Not to mention, having to chase down customers for their payments can be super frustrating. Recurring payments automate this process. They free up valuable time for business owners and their staff. With recurring payments in place, you eliminate the need to send payment reminders. It also lowers the risk of human error in payment processing.
“Automating the billing process reduces the administrative burden on businesses,” notes Herrera, “Recurring payments eliminate the need for manual invoicing and follow-ups, freeing up resources to focus on other critical aspects of the business. This efficiency can also minimize errors associated with manual billing processes.”
Begin offering your customers the benefits of recurring payments today!
With Unity Payments’ Virtual Terminals, setting up recurring payments is super easy. It allows you to automatically charge your customers at pre-set intervals. To learn more, please don’t hesitate to call us at 1-800-661-3761 or email us at info@unitypayments.ca.
