Advertising is what it is… Ads in newspapers, radio, TV, etc. Marketing is altogether a different animal.
Marketing takes many shapes. Marketing can be how your employees handle phone calls or it can be your location. A lot of high-end restaurants spend a fortune for rent and nothing on advertising simply because their location gets the “attention” for them. And, the ways in which you accept payment is a form of marketing.
Wow, 17 percent! Now, when asked why owners don’t take checks the answer is always the same, “we get too many bounced checks.” But, here’s the truth…
According to Linda Masquefa at Electronic Check Corporation, 2 percent of all checks will bounce. Now think about that for a moment. That’s two checks out of every 100. Frankly, I’d rather have my sales be 17 percent higher and get a couple of bounced checks. The increase in sales far outweighs the couple of bad checks you’re going to get.
So, why is it that bounced checks irritate us so much that we quit accepting checks altogether? Because it is an emotional slap in the face when that little envelope shows up from the bank with that no-good check in it. We are mad.
And we start to fume. And we start to hate checks. But, wait a minute. I’ve got a major news flash for you. It is cheaper to accept checks than it is to accept credit cards. In fact, you could shred every bad check you get…and your cost of accepting checks would be the same as accepting credit cards.
Statistically, 2 percent of all checks bounce. So, you would average about $20 in bounced checks for every $1,000 in checks that you accept. This is the same cost as credit cards.
So, in theory, you could shred all your bounced checks and still be paying no more for taking checks than you’re paying for taking credit cards right now. But, a reputable check collection company will collect on about 81 percent of all NSF bad checks. So, what that really means for you is you’ll be out less than $3.80 for every $1,000 worth of checks you receive. And, your “increase” in overall business will far outweigh the tiny fraction of bum checks that you get.
Numbers vs. Emotion
So, if taking checks is another great way to increase your business, why are so many pizzerias and restaurants refusing to take them? The major reason most business owners stop taking checks is because they let emotion make their decision. The reason for this is simple. Each “bum check” grates on them. They boil over at this betrayal of their trust. And they strike out at all check writers for the misdeeds of a very few.
But, That Emotion is Costing You a Fortune!
So, why will you get more business by accepting checks? Simply put, moms do a majority of the food buying for the family and they run the family budget from their checkbook. In fact, they are four times more likely to buy with a check than a credit card.
Furthermore, 89 percent of all adult Americans have a checking account. Checks make up 76 percent of all non-cash transactions. Thirty-four percent of all consumer spending is done with checks.
Bottom line, checks are as good as cash 98 percent of the time. And, Linda at ECC tells me, “With an 81 percent collection rate, you would have to get at least eight bounced checks out of a hundred to just match what credit cards are costing you to process and I’ve never seen anyone have 8 percent of their checks bounce.” There you have it folks.
Supermarkets have done exhaustive studies and have discovered that check usage continues to grow and people paying by check spend more… lots more! People using credit cards or checks always spend more than people using cash!
In fact, while checks account for 22 percent of all supermarket transactions, they account for a whopping 47 percent of total sales! This shows a clear pattern of increased spending when paying by check. So it is clear that people prefer to pay by check. They spend more when paying by check. It costs less to take checks than credit cards.
This is just one more way you can say “yes” to more sales by saying yes to checks. My advice is to accept checks and have a company that specializes in check recovery do the dirty work for you. That way you never have to let emotion get in the way of increasing your sales. Say “yes” to more business.
And speaking of saying “YES” to more business – at the upcoming New York Pizza Show, I’ll be…
- Telling you about the most successful direct mail “ad” in pizza history and how you can adapt it for your own shop.
- How, in every ad there is a “point” where your prospect is almost convinced. There is one thing (and one thing only) that will push them over the top forcing them to call you and order right now (Without this, your ad is dead on arrival).
- I’ll tell you what to do when your competitors are selling for less than you are. This will be a shocker.
- I’ll also be dissecting a failed pizzeria in a segment I call “Anatomy of a Flop.” You’ll see how simple missteps and knee-jerk reactions led to the downfall of a once popular pizzeria. Are you making any of the same seven mistakes? Even one?
- And – I’ll show you exactly how to make a clear offer (minus the mumbling and bumbling that most ads suffer from). Once you see how it’s done, you can position your product so it’s the ONLY choice your prospect wants… no matter how high your price is.
You won’t want to miss it! See you there.