Farmers’ markets, craft fairs and holiday bazaars can be the lifeblood of small vendors — that is, if they have the right POS system to keep the sales flowing. In the latest mPOS Tracker, PYMNTS catches up with sellers from Boston’s SoWa events to find out why fairs and market sellers prefer a simple mPOS system to one with the lowest processing fee.
Come spring, it’s not uncommon to see city dwellers perusing sellers’ stands at open-air arts, crafts and farmers markets in cities across the country. What may be casual afternoon entertainment for the average passersby is a vital revenue stream for vendors, however. Each sellers’ space reflects careful business decisions, ranging from which and how much inventory to bring to deciding on an mPOS system to handle customers’ purchases.
PYMNTS recently caught up with three vendors who sold at the 2017 SoWa Winter Festival in Boston, Massachusetts — and other events — to learn about their payments pain points and their thinking behind selecting an mPOS for their day-to-day business operations.
Sweet n’ simple
Bill Phaneuf’s Ayer, Massachusetts-based Frames with a History sells rustic furniture, picture frames and mirrors made with reclaimed and aged materials. Markets and arts and crafts shows are the lifeblood of his 10-year-old company.
“My business is almost 100 percent show-based,” Phaneuf said. “I’m on the road most weekends… for 30 to 35 weekends a year.”
Of all those opportunities, he said SoWa is his best venue.
When Phaneuf selected a POS system to use at markets, all he wanted was an easy way to accept card payments. Many POS systems bundle in additional features that go beyond mere payment acceptance — such as providing digital invoicing or reporting — but Phaneuf is not interested in exploring or using such services because what he does now works for him. He doesn’t believe it’s worth the complications to change his model, even if added services might simplify some processes. In fact, if customers want a physical receipt or invoice, he’s happy to write one on two-way paper.
“I don’t use the program or the software for receipts or invoices or accounting purposes,” Phaneuf explained. “I know it’s out there [but]… my sole purpose is the card reader for accepted payments. I’ve been doing things a certain way for quite a while and don’t want to go through the hassle of changing.”
For Robin Cohen, owner of homemade jams company Doves and Figs, a simple-to-use system was also a big attraction, but not the only feature for which she was looking. Cohen’s business is now six years old, and she got started selling at events like farmers markets where it’s especially important to be able to quickly process sales. She wanted a system that was originally designed for mobile — not an in-store product with an added mobile app — and she takes advantage of her POS system’s additional features like different seller accounts and product category-based reporting.
Nowadays, Cohen isn’t limited to events, though they remain an important part of her business model. She also sells online and from her company’s shop in North Andover, Massachusetts. Cohen doesn’t turn to her POS provider when it comes to wholesale customers, invoicing and online sales, but instead uses solutions from other companies.
All-in-one offerings
For Boston-based 3D Bean, however, a comprehensive package of solutions was critical. The two-year-old company sells 3-D photographic sandstone figurines of customers, their family members or pets — and events are only the start of its customers’ sales journeys.
3D Bean only started going to events recently, but there are hopes to grow that side of its business, according to director of business development Ashley Durrer. Events represent a chance to sell gift cards, meet potential customers and use its POS system to book appointments for photoshoots, which generate the images used to design the figurines. Purchases happen only after the subject has been photographed and the customer is ready to place an order.
“Any time we can sign up somebody for an appointment, that’s great for us, because that’s the first step of getting someone to purchase,” Durrer said.
Like Frames with a History and Doves and Figs, 3D Bean also sought simplicity from its POS solution. In this case, however, it wanted one solution to provide support to as many processes as possible, including online sales, invoicing, gift cards and in-store or at-event retail. It also uses its POS provider’s appointment scheduling and revenue tracking features.
“[If we’d gone with a different POS provider], instead of just using one system for everything, we’d potentially be using two to three,” Durrer said. “That makes it a lot more complicated. For a small business, that’s spreading yourself a little too thin.”
The POS provider’s appointment scheduling feature is especially important to help customers book their photoshoots.
“When they’re here in the studio, they have their 3D photography experience, and then we’re able to use the iPad and the point of sale software to facilitate ordering their photo figurine and use the payment system,” she explained.
Cards keep hold on higher-cost items
PYMNTS surveyed small and medium-sized businesses (SMBs) across various sectors in 2016 and found a growing trend of EMV card acceptance, from 28 percent in Q1 and 39 percent in Q2 to 47 percent in Q3. Card acceptance was king for the SoWa vendors, especially for more expensive items.
Cards are almost exclusively the way Phaneuf and Durrer’s customers pay, in part due to customer habits, price points and the nature of the events. A typical sale for Phaneuf totals $110 to $120, but attendees at arts and crafts shows rarely carry enough cash to buy more than lunch, he said. During his 10 years in business, Phaneuf has observed that vendors were initially wary of cards, likely due to sales tracking or other aspects, but have increasingly found card acceptance to be a business necessity.
“I’ve seen other vendors start to use card acceptance more than they used to,” Phaneuf said. “A lot of people had been against it. They didn’t want the trackability or claim-ability. But, really, you can’t do without it today.”
Durrer’s main customer base are parents or couples in their 30s to 50s who seem happy to use a credit card for the products — which range in price from $129 to more than $659 — with little to no request for alternative payment methods.
Phaneuf’s primary customer base is dual-income, home-owning married couples in their 30s and 40s, and they are also largely satisfied with using cards. He’s occasionally accepted PayPal or had a request for Venmo, but not enough to prompt him to join the latter.
At her lower price point, however, Cohen tends to take in cash along with cards. She also sees building demand for Android Pay and Apple Pay, and enabling acceptance of those modes is among her next business plans.
Price as a selling point?
Phaneuf uses Intuit and believes what he’s charged is on par with the rest of the market. While he would prefer lower POS expenses, he likes the service enough that he would not change should he find one that’s slightly more affordable. Phaneuf’s volume of sales tends toward 10 to 12 items per day and north of 40 daily sales during the holiday season.
Durrer’s company uses Square. She appreciates its per-transaction processing fees and believes its rates are lower than some competitors and well within the standard range for such a solution. 3D Bean handles several thousand dollars each month, and its POS system fees would not likely be a reason to switch.
For Cohen, whose items cost $5 to $20, fee levels are especially important considerations. While there are some additional reporting features she would appreciate having for Doves and Figs, she would not want them added if it meant a price increase.
“It is pretty inexpensive, so I’d [rather] opt for it to stay at a lower price point and work around limitations than to have it be very full-featured and a lot more expensive,” Cohen said.
Whether small business event and open air market vendors are offering jams, custom furniture, photographic figurines or something else, mPOS providers can help keep sales flowing with offerings like competitive transaction fees, simplicity of use and, of course, card acceptance.
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