SMBs

Why Starting Off Small Can Keep Businesses From Growing

Payments Solutions For Scale

For most merchants, particularly SMBs, growth aspirations are top of mind. But with that growth can come unique challenges and unexpected constraints. Marc Castrechini, VP of Product Development at Cayan, joined Karen Webster to discuss how making the right payments decisions today can help merchants to more seamlessly scale their business tomorrow.

It’s a familiar story.

Small retailer makes a decision on anything — IT and hosting services, telephone services, accounting and tax services, POS hardware, etc. — based on what it needs at the moment.

Two years and a location (or two dozen later), those decisions are at risk of keeping that business from ever getting beyond the small stage its sales and success want to take it.

Then comes the scramble to metaphorically change the tires on a race car speeding around the track, and the risk that the vicious cycle of ripping and replacing the systems that don’t work with others that may also not be capable of scaling as the business grows continues.

But Marc Castrechini, VP of Product Development at Cayan, explained that it doesn’t have to be that way anymore for merchants, especially when it comes to the systems that support the payments piece of their business.

Castrechini said that, in fact, the role of payment solutions providers today should be one that keeps merchants from making a limiting decision in the first place. Today, he said, best-in-class solutions providers prepare merchants early for some of the challenges and hurdles they will face as they grow so that they don’t handcuff themselves to a system or solution that won’t adapt to the changing needs of their businesses as they scale.

 

When R&R Doesn’t Mean Rest And Relaxation

The typical response when a merchant arrives at the POS crossroads, in many cases, Castrechini said, is the old R&R — rip and replace — or worse, paying for and deploying a series of expensive quick fixes or bolt-on services to fill in the gaps it needs filled as the business expands and it’s obvious new services are needed.

That’s often because, when it comes to the payments piece of their business, many merchants have what can be described as an “out of sight, out of mind” mentality.

“When businesses talk about how they plan to grow their business, payments is one of those things that they know they need to do but never really put a focus on it beyond just wanting to be able to process payments,” Castrechini added.

Educating merchants, he thinks, is a big piece of moving merchants beyond that point.

“You have to help the business expand their view of what it means to accept payments today — to understand the strategic importance of payments,” Castrechini emphasized.

That, he said, puts pressure on solutions providers to create flexible and scalable solutions that anticipate what retailers will need to support a payments process that expands what it means to “accept payments.”

Which often means, Castrechini said, thinking about the role of payments in scaling their business. Castrechini explained that SMBs usually fall in one of two camps — those that are uninformed or those that anticipate the challenges but don’t know how to address them because they are too focused on their more immediate needs.

“Most businesses are either focused on solving an immediate need — like implementing EMV — or worse yet, they don’t even know they have a ‘payments’ problem,” he said.

Taking a narrow view of payments means that many merchants underestimate the importance of being able to accommodate payment across shopping channels, integrate loyalty or offers into their payments mix or accept mobile or digital forms of payments.

“This is one of the first times that payments is becoming an opportunity for a lot of people,” Castrechini said. “I think what’s important is for us as a solutions provider is to make sure people keep it top of mind.”

 

The New Scale Mindset

One of the things that Castrechini said is beginning to turn this tide just a little bit is the personal experiences that SMB owners have with their own digital and mobile payments experiences. As consumers themselves — and so the prototypical consumer who’d walk into their store fronts — they have a front row seat to the new complex use cases and changing payments landscape that they will need to manage for their own establishments.

“I think, for the first time, SMBs are starting to understand that they can provide the same experience as those bigger-box retailers and higher-tier merchants, so they are expecting it out of their payment solution providers,” he noted.

The dynamic nature of payments requires a more strategic approach to solutions, putting the responsibility on solution providers to future-proof and delivere a platform that anticipates, while also empowering them with the capabilities to dial things up or down as their needs grow.

“Most businesses are either solving a need they have today or they don’t even know they have a problem,” Castrechini explained, noting the importance of solutions providers helping merchants understand what the air of possible is.

“But most importantly, when you architect or build products, you need to make sure they are flexible enough to accommodate change.”

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Our data and analytics team has developed a number of creative methodologies and frameworks that measure and benchmark the innovation that’s reshaping the payments and commerce ecosystem. The July 2019 AML/KYC Tracker provides an in-depth examination of current efforts to stop money laundering, fight fraud and improve customer identity authentication in the financial services space.

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