For many years, established small businesses have managed to get by with emphasizing cash or paper checks as their preferred method of completing transactions. But that strategy will become increasingly difficult to support over the next 10 to 20 years, as the purchasing power of the millennial generation grows.
That's because more than half of that generation (52 percent) almost never use checks as a payment method, according to some newly released data from WePay, a payments service provider founded in 2008 that aims to make it simpler for small businesses to accept credit card payments on mobile devices.
Approximately 64 percent of consumers of all ages write fewer than three checks per month now, preferring to handle financial transactions digitally or in other ways. That's up substantially from 35 percent just three years ago.
What's more, almost 70 percent of the consumers aged 18 to 34 will only shop at businesses that offer multiple payment methods, according to the WePay research.
These trends are in sharp contrast to what small businesses are doing: 72 percent of the owners surveyed by WePay prefer to accept cash or credit cards. So, there's an obvious disconnect.
The data was gathered by WePay as part of a survey of 1,000 small-business owners and 2,000 consumers conducted by Ipsos and Harris Interactive.
Separate data released this week by one of the leading tablet point-of-sale (POS) technology solution providers, ShopKeep POS, also supports the notion that small-business owners can benefit from introducing digital payment options.
Same-store sales for small retailers and restaurants using the ShopKeep POS platform were up 17.4 percent year over year, based on an analysis completed in May 2013. One company, Sweethaus Cupcakes and Candy in Charlottesville, Va., recorded an astonishing 416 percent increase during that period.
Noted one of the store's owners, Tara Koenig:
"I started out selling cupcakes but now I have multiple streams to my business. I do deliveries, I visit public events with my cupcake trailer, I do weddings and have started selling candy and novelties. The nice thing about ShopKeep is that I can split each of these areas up in my BackOffice and keep regular track on how each area is doing."
Is it time for your business to rethink it's POS strategy? If so, you might want to check out the Death to the Cash Register promotion currently being run by PayPal.