Cash, check or charge?
How Best to Collect the Tons of Money You Will Earn with Your New Restaurant – Cash, Check or Charge?
Perhaps the most exciting part when establishing a restaurant, or any business for that matter, is collecting the money. What is business for but to earn? For some the only concern is the money. Money these days is no longer limited to a single monetary form but different modes as well, which may be called the three big C’s – cash, check, and card or charge. Which is the best mode to earn? This could be a puzzling question for the aspiring entrepreneur. Hopefully, the following will help clear things up.
Cash: Instant Gratification
Perhaps the most common form of money is cash. Nothing wets the appetite for business like crisp new bills. It is the monetary form you are most familiar with and thus, the one most connected to profits and earnings. Cash is good, because it is money in its clearest form, tangible and physical, it is finance incarnate. It is immediately disposable and can be used anywhere.
However, more people try to avoid carrying cash nowadays. First, cash can be bulky; carrying a lot entails one to bring wads of paper. Second, since cash is physical money, it is very risky and can be lost. Once it is gone, there’s practically now way of retrieving it. It can easily be stolen and can even lure danger by attracting robbers and other bad elements. It can be dangerous to customers as they can easily be held up. It can be dangerous to restaurateurs as well because it can it can be easily be embezzled. While cash can give instant gratification, great security is needed to ensure its preservation.
Check: Symbolic Cash
Checks can be very useful for people who have money in the bank. With checks, you can still spend money without having to carry thick bundles of paper around. Checks can be quite secure as the money it represents can only be claimed by the intended recipient, unless of course if the check is written paid to cash.
There are many advantages in using checks, but there are also drawbacks that could inconvenience the recipient. Checks need to be cashed, which takes time and extra effort for the collector. The money collected can’t be spent immediately. Checks expire after a few months, usually six. Perhaps the greatest danger that checks may entail are insufficient funds. The customer paying with a check may not have enough money in their account. It takes more time and effort to gain the money being earned.
Charge: A Promise to Be Redeemed
Plastic money or the credit card is now growing as the most popular form of monetary exchange. It is convenient and easy to use. It is easy to carry and has a lot of spending power in a small package. Consumers love using it because of the extra perks that come with it, such as
airline miles and bonus gifts. On the recipient’s end, money collection is certain, since the responsibility of payment belongs to the credit card company, who carries the burden of chasing delinquent customers as well. The payments may also be directly credited to the recipient’s bank account, making the sale secure.
Convenient as it may be, credit cards aren’t devoid of disadvantages. Credit card companies usually charge significant percentages of sales and could diminish your earnings. Money can also take time to collect and there is more paperwork needed to claim money. Credit card fraud is very possible and can victimize both customers and restaurant owners.
Perhaps the best alternative of all is the debit card. The debit card represents everything good about cash with none of the headaches of checks. A debit card purchase is like having instant cash. A debit card looks like a credit card but functions like a check or cash. When a customer presents a debit card, the merchant swipes the card just like a credit card. The checking account of the presenter is queried to determine if there are sufficient funds in the account to cover the purchase and the amount is immediately deducted and transferred to the merchants account. This is definitely the next best thing to cash!
The Final Verdict
In choosing which mode of payment is best for one’s restaurant the final choice boils down to the customer. Restaurateurs should keep in mind what mode is best for customers to pay – what is most convenient to them with regards to their profile. It might not be advisable for a place that caters to children and teens to accept only credit cards since most kids don’t have cards yet. It might not be advisable to refuse checks or credit cards for fine dining that caters to executives, as prices would be high and bring lots of cash that could be very inconvenient and secure. Of course it is good to have all modes available.
With careful study of the benefits of each mode of payment alongside the market profile, an aspiring restaurateur may be able to choose the best payment option for their restaurant. Hopefully money will rake in by the bundles, whether in cash, check, or charge.