From the casual dining crunch to reports of major high street retailers facing financial troubles or entering administration, there’s little doubt we’re facing a difficult retail environment.
At first glance, if there are fewer retailers struggling to entice customers into stores and this spells bad news for the card and payment sector.
Go deeper with GlobalData
Upon closer inspection however, it represents a huge opportunity and it’s up to our industry to shout about the difference we can make to struggling retailers along with the solutions we can offer to new players seeking to succeed in a changing landscape.
Technological developments in the payments sector are enabling businesses of all sizes and sectors to survive and thrive in the face of challenges.
The challenge
Retailers face large, macroeconomic challenges that might seem too significant for the payments sector to tackle.
These challenges range from shifts in consumer confidence and spending patterns to increases in inflation or a fall in wages.
How well do you really know your competitors?
Access the most comprehensive Company Profiles on the market, powered by GlobalData. Save hours of research. Gain competitive edge.
Thank you!
Your download email will arrive shortly
Not ready to buy yet? Download a free sample
We are confident about the unique quality of our Company Profiles. However, we want you to make the most beneficial decision for your business, so we offer a free sample that you can download by submitting the below form
By GlobalDataOf course, no one tech solution can totally solve these issues, but in addressing cash flow concerns, offering new sources of revenue and enabling businesses to provide greater convenience to consumers, the card and payment sector should be pushing for greater recognition of its role in equipping retailers to take on a tough environment and here’s how:
Introducing new revenue streams
Boosting revenue and building customer loyalty is hugely important for retailers during difficult times, fortunately the payments sector is continually developing in a way which enables retailers of all sizes, including sole traders, to do exactly that.
Sophisticated payment tech is diversifying revenue streams by also, for example, allowing retailers to offer customers mobile phone top ups when making payments.
This boosts customer loyalty among shoppers who appreciate the added convenience, while at the same time providing an additional reason for shoppers to visit the store in the first place.
Payment tech is also evolving by allowing retailers of varying sizes to offer private label gift cards which again boost customer loyalty and revenue, as well as helping to generate brand awareness.
Competing online
One of the big challenges facing bricks and mortar retail is the increasing volume of online spending, which is proving a particular problem for larger retailers who overinvested heavily in physical store space during better economic times.
Clearly, the solution for retail is to adapt and meet consumer requirements, and here again, the payment sector offers solutions.
More integrated payment solutions are ensuring that retailers, including sole traders, are able to create a single, consistent physical and online presence, processing payments across online, instore and through the use of near-field communication (NFC).
While smaller retailers are – in some ways – less exposed to a shift away from bricks and mortar retail, many have previously not been able to process payments online. Innovation in the payments sector means they can now evolve with changes in consumer spending habits and maximise their potential to bring funds into their business.
Tackling cash flow concerns
In a tough retail environment, cash flow is a concern for the majority of SMEs in particular.
The card and payment sector wouldn’t always have been seen to be the solution as historically it took days for businesses to receive funds after accepting a card payment.
However, new integrated platforms are now playing a role in tackling the cash flow challenge, with retailers able to accept and settle payments instantly, meaning small businesses gain instant access to their funds when accepting card payments.
This is a particularly important benefit for small businesses, who are most likely to be affected by cash flow concerns and might previously have declined to accept cards because of the delay in receiving payment.
As a result, the payments sector is helping a broader range of retailers present themselves as credible businesses, while offering consumers convenience in an increasingly cashless society.
Credit for the payments sector
It’s up to the card and payment sector to promote these innovations – demonstrating collaboration across the industry and with retailers and entrepreneurs to tackle a challenging environment.
While retail woes might dominate current headlines, our industry must shout about the role it can lead in the fightback – offering valuable new technologies and enabling a broader range of businesses and entrepreneurs to succeed in retail.
Ambreen Khasru is a director at myPOS
