Accepting cheques

[gary]

I've had a couple of instances now where customers have just sent cheques requesting us to send them a specific tie, even though the site says we don't accept cheques. I've avoided accepting cheques simply because of the extra admin involved, and past experience with cheques showed that often people selected to pay by cheque and then never sent it. Of course the goods aren't despatched until the cheque has cleared, but even so you've got to keep chasing them up to get payment. Seems like a lot of hassle for a £10 product.

There seems to be a split among the sites I've looked at - about half accept cheques, others clearly state cheques are not an option. Does anyone have any thoughts on this?

Gary

 

[gj]

If I buy online I expect to pay online too.

This is partly because having found the item and having an online ordering system, I don't want the hassle of then writing a cheque, probably some sort of covering letter/note, and writing out an envelope, getting a stamp and then posting it. Paying online just means it is ordered there and then and I can sit back and wait for it to arrive.

I accept that the vendor wants it automated as far as possible too.

Therefore, I wouldn't bother with cheques - and I can't believe you will lose many sales if you don't accept cheques. The thing is - you'll never know anyway, so why worry about it.

Regards


Graham

 

[Ozzy]

Far what its worth Gary, I accept payment by cheque but wont process the order (or even lift a finger) until the cheque has cleared in the bank.

Around 80% of cheques I receive bounce and the persons is logged with Experian to ensure the bad payment is logged on their credit rating.

 

[gary]

Thanks Graham and Richard - I've always avoided it because it's more hassle than it's worth, especially when the sale is of such a low value, and I certainly don't want to deal with chasing payments and bounced cheques (and no doubt the bank would charge a fair bit for that as well!)

Gary

 

[SillyJokes]

Gary have a look at what we have set up for cheque and postal order orders. You shop online and then make the postal choice when checking out.

A form is automatically generated which they fill out, print and send to us with payment. We don't do anything until the payment arrives.

We get around 5 postal orders a day, some of which are very large as some organisations can only shop by raising cheques.

Admin is a bit of a fiddle but we've automated it as much as poss.

Never turn down an order just because someone doesn't like to buy online.

 

[gary]

Thanks Caroline. I can easily add cheques to the payment options, and have accepted cheques for corporate orders before, but in previous businesses I've worked in I've had endless problems with cheques not being sent, or for the wrong amount or date, or just bouncing. I seemed to spend so much time fixing all those problems that I just stopped accepting them altogether. That's why I'm hesitant to take cheques now.

I wonder if you didn't offer cheques at all how many of those 5 cheque orders per day would use a card if they had one? The reason I ask is because a while ago I advised a client to try taking cheques to see if that helped increase his orders. The number of cheque payments increased, but the number of orders stayed pretty much the same! Customers just opted to pay by cheque instead of card. Only about 40% of them ever sent the cheque and the client got so fed up with chasing them he stopped accepting cheques altogether. In the end, the cheques cost him a lot of sales because the orders were never completed.

I think I'll see how it goes and what the demand is. Thanks for all the help.

Gary

 

[SillyJokes]

Well Gary, we don't send the stuff till we get the cheque and refuse to hold stock for people paying by post so there is little or no chasing involved for us.

Problems experienced:

We have had a very few bounced cheques and often this is just a mistake and not deliberate and payment has been easily obtained.

Not signing checks or sending them without any order details - this can be a pain sometimes.

Cheques from overseas - we do try and make it clear we don't accept these but they still manage to send them sometimes. We just send them back.


Advantages.

We do get orders from kids by cheque or postal order - we sell practical jokes which appeal to this age range so it is a way they can buy from us when they don't have a credit card.

When people simply won't order online it is useful to offer this service which they are comfortable with.

5 orders a day is a very small proportion of our daily orders. We have not seen the same growth in post orders that we have seen in online orders.

We don't really advertise the fact that we take post orders on the site very much so it is only used by those really determined to order from us who don't want to order online plus schools and councils who cannot buy by credit card.

Obviously we would prefer everyone to order online. It's simpler and quicker for them and us but in the end you have to give people every opportunity to order in the way they want to.

PS we do track affiliate sales made by post - a code appears on the form when it is printed.

 

[gary]

Thanks Caroline! As always your advice is very helpful!

Gary

 

[Toon]

I'm happy to accept cheque but find that not many people use this option. I tend to mainly get cheques off Ebay auctions. I sometimes think it's best that I get cheques because it saves money on credit card processing fees or Paypal fees etc!

 

[kyber]

To avoid migrating card customers to cheque customer with no increase in sales, how about charging a handling fee for cheques because of the extra admin involved (presenting to back, waiting for clearence, etc.)?

Stuart

 

[gary]

Stuart, that is an option, but then you end up with the same complaints when someone charges a handling fee for credit card payments. I've only had 2 or 3 of requests for cheques recently and I think two of those ended up using a card anyway, so I don't think it's urgent.

Gary

 

[Ozzy]

It is dependant on the market as to whether taking cheques is helpful to business or not.

In my case an accountancy firm may not wish to pay by card and woudl rather pay a monthly invoice, so I am having to change my systems to accomodate this. However, as Caroline says many of her clients may be children buying practical jokes.

Me personally, it is not practical to accept cheques to "one off" customers forming one company because I had a fantastically huge "cheque bounce" rate and the bank charges wipe out any profit margin on the order even if the customer would pay in the end - and only one in the past 2 years has!

 

[Anonymous]

Regarding cheques, I woull say that depend on the amount of the sale. You have and obvious adminitrative cost and risk using this payment methods; therefore, if the profit pays them, go forwards...

Cheers
Fernando