If you could guard your precious time and spend it on activities that help your business grow faster, would you? Did you know that accepting cash as payment – especially if yours is a cash-only business – can be detrimental to your overall bottom line?
Most Canadians Don’t Carry Cash Anyway
For businesses that only accept cash, the “shrinking wallet” is threatening. According to a recent Square study, the average amount of cash Canadians carry is continuing to drop.
Square’s Head of Payments, David Talach, says, “We found the average amount of cash Canadians carry is $44.70. That’s almost one less toonie in every wallet from a year ago showing Canadians are slowly but increasingly living a cashless life.”
The vast majority of Canadians prefer to pay by card anyway. For business owners, it pays to know that 80% of Canadians prefer to pay by card or else you may lose out on the sale because Canadians on average are only carrying $44.70 in their wallet, which dropped by $1.80 from a year ago (was $46.50). That’s almost one less toonie in every wallet showing that Canadians are increasingly living a largely cashless life.
In fact, these are more insights gleaned from Square’s research:
- Canadians carry an average of $44.70 in their wallet, which dropped by $1.80 from a year ago
- Canadians aged 35-44 are the most cashless Canadians, carrying only $27.70
- The survey also found women carry $41.90 almost $7.00 less than men and maritimers carry the least amount of cash at $41.20 and Quebecers carry the most with $48.80.
And, cash doesn’t factor as well into your business’ financial reporting, either. It provides a level of anonymity that can really hinder your ability to gather insights into your business – insights that can inform everything from inventory management, sales tracking, payroll, and taxes, essentially helping guide the direction of your business.
The tens-of-thousands of business owners accepting only cash run the risk of losing out on sales during the summer and year-round as Canadians become increasingly cashless. Square is helping more people to take payments and run their business. In fact, 65% of Canadian businesses have taken their first ever card payments with Square.
Hidden Costs of Cash Defined
Here’s how Square sees it:
Business owners spend too much time managing cash – in fact, they’re spending on average over 14 hours every work week.
Why it’s a problem
Business owners are busy and often too focused on their day-to-day operations to realize ways they could operate more efficiently, especially concerning their cold, hard cash.
Modern payments and point-of-sale tools like Square give business owners back their precious time and can help grow their business faster.
If business owners knew there was a better way, they’d choose it, right?
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So, Square Did Some Research…
According to new data findings from the payments company, they’ve uncovered the hidden costs of doing business with cash or cash-only payments. The verdict?
It turns out, cash costs Canadian business owners - big time.
The poll found business owners across the country spend an average of 14.4 hours of every work week counting money or making trips to the bank to make deposits and/or withdrawals. Stated another way, each business accepting cash loses a whopping 100 working days per year to low-value, cash-related tasks. Because cash is such a precious commodity, cash-related tasks are often handled by the most senior person or the business owner themselves. But counting cash and bank runs are low value tasks and these time-consuming activities robs business owners of their precious time.
Business expert Karisa Marra from Square has been working with Canadian businesses for over 10 years. She has strong opinions on why businesses are still spending so much of their time managing cash. While Karisa doesn’t advocate that all businesses go cashless, she recommends business owners to consider their customers and accept the ways their buyers want to pay. The vast majority – 80% of Canadians – prefer to pay by card.
The Costs of Cash-Related Tasks
Accepting cash payments is just a part of doing business, right? Maybe not. The results of Square’s poll suggest that business owners are aware of the issue and are open to changing their ways. Business owners know that cash management is very low on the value spectrum. In fact, nearly 40% of Canadian small businesses that currently accept cash said they like the idea of recovering the time spent on cash-related tasks to focus on higher-value, more strategic aspects of their business.
Day-to-day business operations & cash-related tasks poll findings
Cash might be an easy way for some people to pay, and an even easier way for you to accept the payment – but, inevitably, cash costs time. In Square’s recent survey, we found that business owners across the country spend an average of 14.4 hours of every work week counting cash or going to the bank to make deposits and withdrawals. That’s a whopping 100 working days per year that businesses lose to low-value, cash-related tasks. According to Marra, “Business owners are consumed by their day-to-day, short-term success and feel like they don’t have the time to consider modern tools that can find efficiencies and help evolve their operations.”
So, the real question is – what’s stopping these businesses from embracing new payments technology and upping their revenue game? Well, actually, there’s a couple things.
First of all, tasks related to cash are ones that owners feel they should be responsible for. Most business owners handle all bank deposits and withdrawals, as well as back-office management and reporting.
Secondly, various matters – and just plain busy periods throughout the day – don’t allow most business owners the luxury of trying something new. The sheer necessity to maintain a tight rein on their business comes first. Marra says, “Canadian business owners tend to be more risk-averse. While that can be a great quality for a business owner, it can hold them back from trying new approaches that could be helpful.”
But There’s a Better Way to Do Business…
Today’s modern business payments and POS tools allow business owners more time to focus on the most crucial aspects of their business. Tools like Square can help you retrieve precious hours from the day and grow your business faster.
Square offers accessible tools to accept card payments and a free point of sale – a digital toolkit – that helps business owners manage their sales, inventory, employees, locations, and more. Also, our free Square app, gives you access to analytics so you can make informed decisions about your business. Ready to take your business to the next level? Open a Square account – see where payment freedom can take you.