What is Square?
If you’re considering getting or switching your POS system, you might have run into Square. It’s undoubtedly one of the most widespread mobile payment systems around. If you’ve ever shopped in an online store, there’s a good chance they’re a Square user.
But is this payment system really one of the best you can get? Is Square credit card processing a good deal?
In today’s post, we’ll discuss what Square is, how it works, and what are its advantages and disadvantages. So before you say “SQ my business!” and apply for an account, read on first to find out if it’s right for you.
Square is one of the leading mobile point of sale platforms that allows merchants to accept payments almost anywhere. It’s a comprehensive system that offers the complete package from the hardware and software, and even other value-added services.
The company was founded by Jack Dorsey, who also co-founded Twitter. It boasts a user base of around 2 million businesses, while the Square mobile app has been downloaded over 33 million times. Since going public in 2015, it also acquired the web hosting platform Weebly as it sought to enter the e-commerce market.
A lot of owners often ask, “Is Square good for small businesses?” and the answer is a definite yes. In fact, part of Square’s appeal is that it’s available for businesses of any size, unlike most payment processors that have stringent requirements for you to qualify. Square is also suitable for smaller businesses or start-ups because it has lower setup costs. It also doesn’t require any monthly fees that can eat up your bottom line.
Square for Business – How it Works
The critical difference between Square versus other point of sale platforms is that it’s a payment service provider (PSP). They basically function as one large merchant account, instead of assigning individual accounts to each merchant.
This is why it’s easy to qualify for Square no matter what size your business is. Square generally does the background checking after you’ve enrolled in their platform. Hence, why you’ll see many people complaining about trouble with accessing their funds and the like.
Apart from this, though, Square functions just like any other payment processor, albeit with a wider variety of choices. At the most basic, they allow you to do credit card transactions both in your offline or online store. This is done through their free Square app.
You can also opt for their paid Square business POS solutions, which give additional features for specific businesses like retail or restaurants. They go beyond payments and offer tools for managing payroll, loyalty programs, inventory, and even staff.
Advantages and Disadvantages of Using Square
The main advantage of Square is the ease of use. The free app is remarkably user friendly and one that you or your sales staff will pick up quickly. This is a departure from a traditional POS system, which can be daunting to use.
Apart from usage, Square also makes registering your business painless. Anyone can register with Square, and they generally won’t have any demanding requirements. They generally check your business after you’ve registered and, if you’re not doing anything illegal, then it shouldn’t be an issue. You also don’t need to pay any monthly fee, as most of the cost is done on a per-transaction basis. Basically, you only pay for Square whenever you use it, which is cost-efficient.
However, that last pro also turns out to be one of its cons. Despite being simple in pricing, it’s actually tricky to predict the real cost of using Square. That’s because it changes depending on which hardware and software you use and how big your transaction volume is.
Lastly, the Square for small business isn’t the easiest thing to integrate into your existing accounting or payroll system, if you have one.
Is Square Right for my Business?
Square has its pros and cons, but the biggest has got to be with its pricing scheme that favors lower sales volumes. While the credit card fees are much higher per transaction, the good news is that Square doesn’t charge any recurring fees. This means that, at a certain sales volume, you’re actually saving quite a lot compared to mainstream credit card processors.
Hence, Square for large business is generally a bad idea. It’s much more suited to start-ups or smaller businesses that have lower sales volumes.
Square’s not bad as well if you’re running an e-commerce store. That’s because its credit card rates are quite competitive compared to its competitors like Paypal. You also won’t be charged any additional fees for integrating Square into your store’s checkout process.
So, what is Square? The bottom line is that it’s still one of the leading POS systems to help today’s businesses succeed. Of course, a POS isn’t enough. You need access to quick financing to power your operations, something that L3 can help you with. Contact us today to find out more!