Reasons Why Dispensaries Don’t Accept Cash
Nowadays, most businesses get their earnings via electronic payment transactions. The reason for this is that if they run on a “cash-only” basis, most of them will fail in no time.
This can also be applied in the cannabis market. Several years ago, cannabis farms and dispensaries were limited to solely operating on cash transactions. This is because of the strict regulations that surround the cannabis industry. However, as the market keeps on growing, alternative payment options become available.
Today, most dispensaries do not accept cash. Of course, there’s a reason for this. Today, we’re going to share with you why they prefer dispensary credit card processing options instead of cash.
The Issue with Operating a Cash-Only Business
A marijuana-friendly bank account is one of the first things you need to have when you start a marijuana business.
If you do not have one, you will probably fall into the trap of operating your business cash-only. If this happens to you, you will encounter a lot of various issues. This includes:
Lack of Usability
While it’s easy to pay your local employees with cash and envelopes, severe complications happen if you pay your remote employees or cannabis suppliers.
Keep in mind that you cannot use debit cards or checks if you’ve got nowhere to bank your cash. Because of this, you will have to travel long distances to pay by hand, resort to money orders, or mailing cash. To make things simple, it’s extremely complicated if you’re a cash-only business.
Lowered Sales and Cart-Size
Whenever they shop, clients expect electronic payment options. Though a couple of them might choose to pay the ATM fee, a lot of them will choose to only shop at cannabis dispensaries that do provide some type of electronic payment option.
Providing electronic payment greatly improves your ability to sell more products. The reason for this is that clients aren’t limited to the cash they have on hand. According to studies, you can improve your average cart size from 20-50% if you provide an electronic payment option.
People tend to spend more if they’re able to use their credit cards.
Huge Security Risk
Storing money on your establishment opens you up to robbery both internally and externally. If you want to deposit your cash to the bank, you will have to carry huge sums of money with you. Of course, this creates a major safety risk.
If you want to avoid these risks, you will have to hire armed security. Aside from that, you will have to install CCTV cameras. When you want to deposit your funds to the bank, you will have to hire an armored car to safely transport the money. All of these additional expenses increase your overall operational cost.
Mitigating risk is part of growing a strong business. Thus, you’ve got to ensure you know how to tackle the payment processing of your business. If you really want to be successful with your cannabis business, the best option you can take is a dispensary credit card processing solution.
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