When my miracle worker, Felicity, gets a bee in her bonnet she is always worth listening to! A recent story from her makes a great point so here it is direct from the horse’s mouth (sorry Felicity… dunno the replacement phrase!).
I’ve noticed something interesting at our local shops. A new dumpling store has opened up, and they set a minimum $20 charge to use EFTPOS.
Since then, however, 2 other Asian food stores in the shops have also introduced minimums, including one with a $30 minimum.
In these modern days where more and more people don’t carry a lot of cash around (I certainly don’t), I can’t help thinking they’re putting off customers. I know there have been a couple of times when I’ve gone to order food, only to remember the minimum (which may be fine if you’re ordering for a family, but for one or two people, maybe not…) and ended up eating elsewhere.
I understand that it costs money for them to provide the service, and on small transactions the fees are high, but I think my daughter expressed it best when she said “I never carry much cash. So they’ve lost me as a customer. Why can’t they do what the Asian grocery store does, which is if you use EFTPOS for a purchase under $10, they charge you a small fee to do it? If I only need $4 worth of items, I’ll just pay the fee for the convenience. But if I’ve already got $8 or $9 of things in my hand, I’ll probably buy something more to get over the $10 limit. So they get a bigger sale.
Are you making it hard for your customers, clients or patients to buy. Think about it and make it e-a–s—y!
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Felicity this is such an important message to small businesses and you have explained so well. They must understand the Lifetime Value of a Customer and stop getting hung up on the cost of servicing individual transactions.
Totally agree Jurek!