Procurement Fred Heritage · 15 March 2017
Failure to innovate will see cash-only ventures lose more and more customers
Small businesses which fail to invest in card payment technology could be losing out on as much as 23, 000 a year in profits, according to new research. A recent study, commissioned by online business service market place Expert Market, revealed that almost half of all payments made to small UK businesses in 2015 were made using a debit or credit card, equating to average profits worth 93, 660 per business. With the research showing that one in four British consumers actively avoided cash-only ventures, it suggests small firms miss out on 23, 145 of profit per year by limiting the ways customers can pay. Card payments are predicted to make up 65 per cent of all consumer payment transactions in the UK by 2025. The study concluded therefore that the amount small businesses owners stand to lose in missed sales by failing to offer cashless alternatives could be as much as 35, 000 a year in future. The head at Expert Market, Adelle Kehoe, said that innovation would be of increasing importance should small business owners want to remain competitive. As the millennial generation comes of age and their purchasing power becomes stronger, business owners will have no choice but to pay attention to their preferences. our findings highlight the need for cash-only ventures to adapt to remain competitive or miss out on huge profits by choosing not to keep up with consumer buying behaviour trends, she added. The main reason cited by the study for diminishing cash use is a generational shift, with the millennial generation preferring not to carry cash around with them day-to-day. Nearly two-thirds of 24 to 34 year olds would chose a debit or credit card transaction instead of having to carry cash, the research found.
ABOUT THE EXPERTFred Heritage
Fred Heritage was previously deputy editor at Business Advice. He has a BA in politics and international relations from the University of Kent and an MA in international conflict from Kings College London.