Pssst…! Do you work in retail? Well I’ve got the secret to retail success. Just for you.
It’s…make the customer’s life easier!
Okay, okay, don’t throw things at me. It’s not a secret if it’s a basic truth that literally every online retailer knows.
But here’s another one: if you don’t have a simple checkout and payment experience for your online shoppers, nothing else will matter. Customers will find something they like, put it in their cart…and then get frustrated as their payments are refused or take too long. More likely than not, you’ll end up with what every online retailer dreads most: the completely full, but totally abandoned, shopping cart. And no amount of follow-up emails or texts will induce the customer to complete their purchase if your process is too inefficient or slow.
So what’s the answer? Here’s what savvy online merchants know: over the last few years, as online shopping has boomed exponentially during the pandemic, two things have become increasingly clear.
- After a certain point, it’s almost impossible to efficiently take online payments without a payment gateway.
- While the payment gateway makes payments easier, it makes account reconciliation a lot more complex.
And if you’re flummoxed by this contradiction, you’re not alone. So let’s break it down a little.
Payment Gateways: The Future of Retail
The growth of online shopping shows no signs of decreasing. Over 90% of internet customers have purchased products online and over half of all shoppers have bought from retailers located overseas. It’s likely that in the next few decades, most–if not all–purchases will be done online.
Payment gateways allow various and flexible methods of payment, including bank accounts, credit/debit cards, gift cards or digital wallets. And because they use secure encryption, payment gateways can help reduce chargebacks, protect your customers’ data and reduce the risk of fraud.
Quality customer service, faster payments and fewer abandoned checkout carts. In fact, it’s pretty hard to be competitive in the online marketplace without the right payment gateway.
But like anything in life, payment gateways have flaws. Heavy traffic during peak shopping periods, like the holidays, can cause the gateway to experience frequent timeouts or cause payments to get stuck or fail repeatedly until processing is delayed.
And the best payment gateway won’t help you if it doesn’t integrate well with your accounting software. Without seamless integration, you face copious amounts of time and money trying to implement an integration solution, as well as training and management challenges.
As if that’s not scary enough, payment gateways can also cause huge problems for your payment reconciliation processes.
When Payment Reconciliation Falls Behind
You know reconciliation means making sure all your numbers–sales figures, billing invoices, account ledgers–match up with the bottom line of your bank account.
With a payment gateway platform, you’ll receive a daily report of all payments and debits. Many online retailers are realizing that a payment gateway integrated with an ERP can further reduce overheads and minimize manual processes.
So you’ll sell more, to more customers.
And that means more transactions per day.
And that means more transactions for your accounting department to reconcile.
And if your team doesn’t have the staff, equipment and other necessary resources they need to process these additional transactions, they’ll soon fall behind.
So what are some of the red flags you should look out for to identify if it’s time to add capability to your payment gateway software?
- Unreconciled packing, shipping or commission charges or overcharges
- Missing internal controls to standardize the payment process workflow
- Incomplete details regarding electronic payment and refund transactions due to these activities being processed in different channels
- Incorrect or missing information regarding in-store purchases and returns
- Missing information regarding value of marketplace discounts
- Mistakes reconciling returned orders or multiple deductions on a single order
- Problems reconciling details of missing or damaged inventory
- Difficulty reconciling partially paid invoices
Payment Processing Features Every Retailer Needs
The payment gateway paradox is proof that growth means increasing complexity in all parts of your company, including finance and billing. But the account reconciliation nightmare can be managed with a payment software setup that causes as little disruption to your payment processing as possible. Here’s a list of key features we recommend being on the lookout for in your payment gateway provider search:
- Product Life Cycle Monitoring, from onboarding to editing to deleting
- Internal controls to standardize the payment process workflow
- Ability to import and compile the transactional data from various platforms
- Reliable backup of payment records for audits
- Configuration options to alter checkout, relevant fields and customer portals
- Omni-channel payment options that are uniform and consistent
- Comprehensive sales data and analytic insights on individual transactions
- Responsive technical and customer support (preferably 24/7)
- Record retrieval that immediately locates signed receipts in the gateway
Online businesses need to be able to assimilate across platforms without losing personal touch or skipping out on fresh content. This means you need a payment gateway that can deal with a high volume of transactions and work with as many payment methods as possible.
Because the worst-kept secret in retail is that nothing creates success faster than great customer service. That’s why payment gateways are here to stay. So now it’s time to ask yourself the question: Does your payment gateway work for you, or against you when it comes to your internal financial processes?
And for more payment gateway content, click here!