There is no doubt about it; we're living in a digital world. While it may feel challenging to stay up to date on all the online marketing trends as a small business owner, the Internet has certainly made many aspects of being a contractor easier. For one, you can connect with clients and prospects with the touch of a button. But, just as importantly, technology can also help you pay your suppliers and employees, and get paid sooner-improving cash flow and freeing you up to focus on other day-to-day business matters.
Read on to learn how switching to digital-age payment platforms can benefit your construction company.
The Benefits of Digital Payments
Cash Flow
Don't wait weeks, or even months, to get paid upon completing a construction project. In an industry where a constant flow of cash is necessary for buying supplies and paying subcontractors, getting paid quickly and efficiently is vital to the cycle of your business.
Stronger Security
Paper checks can bounce and cash can go missing. With fraud teams and safeguards in place, transitioning to digital payments can better protect your contracting business and customers from financial mishaps.
Win More Bids
Customer habits are changing, and more clients expect their contractors to accept digital payments via tools such as direct deposit, Zelle, Venmo, or PayPal. Don't miss out on an opportunity because you think the old way is the only way.
Stay Organized
Digitizing payments will not only help you enhance efficiency and stay on top of unpaid invoices, but a digital paper trail can also help you stay organized when it comes to bookkeeping and fact checking any claims from vendors.
Increased Transparency
Whether you're a contractor, subcontractor, or supplier waiting to get paid, standing by for a check to clear can feel like ages. With electronic payments, you'll get constant updates on the status of transactions, so you can track exactly when money will hit your account. Plus, once the payment is complete, both parties will be notified by the platform.
Digital Payment Options
If you're still signing physical checks and not sure how to get started with digital payment platforms, take a look at some of your options, along with the pros and cons of each:
Credit Cards
Pros: Most commonly used for businesses, fast, added security and protection, a record of payment
Cons: This option may include transaction fees
Direct Deposit (ACH Transfers)
Pros: Easy to use, can be cheaper to process than other methods, automate payroll, reach customers without credit cards
Cons: Banks might charge a fee, processing may take several business days, you may have a daily or monthly cap on how much money you can transfer and fees for insufficient funds
Peer-to-Peer Services (P2P)
Pros: Customers are likely to be familiar with apps like PayPal and Venmo, easy to link to bank accounts, secure payments, instant transfers with Zelle
Cons: Spending limits; both parties must have active accounts on the platform
All in all, consider transitioning to digital payments; your clients, employees, suppliers (and check signing hand) will thank you.