Taking Payment from Customers

[Northern1]

Hello All,

I am currently in the process of completing a business plan. All is going well but I am struggling with some of the finer details - possibly a mild form of paralysis by analysis!?

My proposed business will be selling products to a B2B market place (medium to large size businesses). We will be selling products (and taking payments) online and over the phone.

Each customer will have an account with us and would place regular orders.

My question/s is to do with taking payment from customers.

Through peoples experience or expertise, could you please share any thoughts, experiences or recommendations that would help lift the fog for me.

The things I am looking to understand more include:

1. What payment method would "business" customers prefer to pay (credit / debit card, direct debit, via a payment gateway etc)?
2. Which service provider is the peoples favourite to go with (World Pay, Paypal, local bank etc.)
3. Why did you recommend the service provider, was it down to price, customer service, their flexibility...
4. Is there any pitfalls that I need to be wary off?

I don't really want to accept cheque payments due to the time it takes to cash them in (and the chance of them bouncing) and cash payments are not really an option nor chip & pin - we don't often meet customers face to face to take payments.

Thanks again for your support!

Kind Regards
Martin

 

[sb65]

Depends on what sort of business you're dealing with but I'd have thought quite a few will want invoicing and pay by BACS or direct debit for regular customers, i.e. pay in arrears. Some companies may issue debit/credit cards to (some of) their employees, in which case I wouldn't have thought they'd mind where the payment gateway is. Since you're dealing B2B few buyers are likely to have Paypal accounts, but you can still take card payments via Paypal. You read a lot of horror stories about Paypal, but we've never had a problem with them and the absence of a fixed fee means they're attractive for startups. We use Worldpay zinc for face to face and over the phone payments - I think Paypal have a similar arrangement as well.

For info, we deal with schools a lot, and they're split about 50/50 between BACS payments and cheque payments, so you may find that you need to accept cheques, dependent on your customers.

 

[antropy]

The things I am looking to understand more include:

1. What payment method would "business" customers prefer to pay (credit / debit card, direct debit, via a payment gateway etc)?
2. Which service provider is the peoples favourite to go with (World Pay, Paypal, local bank etc.)
3. Why did you recommend the service provider, was it down to price, customer service, their flexibility...
4. Is there any pitfalls that I need to be wary off?

1. We mostly deal with business customers and they generally pay by BACS, PayPal or cheque. Cheques are slow and require paperwork and posting so they're the least favourite method but some companies still love them.
2. Why not give them an option of a few? I like PayPal.
3. PayPal are everywhere and simple to use, they're known and trusted, but they're also probably not the cheapest.
4. Chargebacks and refunds!

 

[BeechDirect.com]

In my experience, I would definitely offer your customers a variety of payment options, but be careful, as some carry high risk which can affect your cash flow. Research how long it will take before you receive cleared funds, in my opinion, this can make or break a new business, if your constantly waiting for funds to clear. Have a look into outsourcing your credit accounts, as you will get paid instantly and they will chase the payments. But in terms of card payments, I would recommend at least 2 options. Most businesses will pay by BACS, as above.

 

[erictwendell]

It entirely depends upon what kinds of goods you sell. What kind of services you need from your solution providers etc