How to Switch From Venmo to a POS For Your Business

Carolyn Canetti
Jul 23, 2020 3:09:36 PM

Everyone starts out differently when beginning a business. Some people ease into work as a side hustle first, others may begin working with friends, family and acquaintances, and others might be part of a freelance or contract network. All of these have different mechanisms to get paid; perhaps, it's cash, Venmo, Zelle, or W-9 invoice through a company. 


There's a certain point, and it's different for every business, when it makes sense to ditch the digital wallets like Venmo, and move to a more professional and secure point of sale (POS) that works for you and your customers. 

 

 

What's Good and Bad About Venmo:

 

Ease of Use with Friends

Venmo is so easy! All for Venmo when paying friends back for Thai food, or sending your girlfriend's brother money for the AirBnB, and even for one-off purchases like buying a couch off of a neighbor, or having a friend design you business cards. 

 

But when your physical therapist asks to be Venmoed, or your landlord says you can pay her by Venmo, or your personal trainer Venmoes you for your session, it just doesn't feel quite right. As a customer, it is like sending money into the abyss, hoping that the small profile picture really is your dentist, or that you typed in a phone number correctly. 

 

No Credit Cards

Venmo is owned by PayPal, so it is secure, but there are aspects of Venmo that aren't. And as a business owner, there's nothing contractual that forces a client to respond to your payment request later in the day and send you money. Utilizing Venmo can feel like a good-faith deposit, you just hope that you're working with a trustworthy client and vice versa. If you make a mistake on Venmo, you don't get your money back, whereas you can dispute charges through your bank/credit card.

 

A lot of people like Venmo because it doesn't include credit or debit card transactions. It's assumed that the fees associated with transactions through PayPal (ironically) or any other POS are not worth it, if you can utilize a digital wallet like Venmo or Zelle, which is connected directly with your bank account. Using a point of sale is a traditionally cleaner way to accept payments, produce refunds, keep receipts, and eventually pay your taxes (ugh!). While some POS systems are out dated and borderline medieval, there are modern and professional choices out there. 

 

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Point of Sale Systems:

 

Best POS Alternatives to Digital Wallets

For an individual business owner, some point of sale systems are no doubt over the top and won't be necessary. For in person businesses, you might need a piece of hardware - a chip reader, card swiper, pin pad, printer, whereas online businesses can use something more streamlined through multiple software companies, website builders or other. 

 

POS systems in the long run save businesses time by streamlining operations, reducing additional costs, providing a central data point for sales reporting, eliminating human error, and improving a customer experience. 

 

Within POS systems, there are cloud-based systems, mobile-based systems, electronic-based systems, or one can opt for a credit card terminal. The best choice for you depends on where you are making your sale. 

 

See how the top point of sale systems compare in regards to hardware, transaction fees, monthly payments, one-time fees, hidden costs and more:

  • PayPal: PayPal has no monthly fees, and charges a 2.9% online transaction plus fixed fee based on the currency of payment. In person sales have a fee of 4.4% with the same fixed fee based on currency. They partner with other POS tools for any hardware needed in store, and need to be linked to from your website. Learn more here.
  • Stripe: For online only businesses, Stripe is free to create an account, with 2.9% + $0.30 transaction fees. In person chip readers start at $59 up to $500 for hardware. A great choice for online checkout, and straight forward to small businesses. Stripe does require an integration with your website. Learn more here.
  • Bounce House: Shameless plug, we partnered with Stripe to offer all encompassing sales transactions in tandem with your website and customer management. For $19/month plus 5% and $0.50 transaction fees, you can enjoy the magic of Stripe without going back and forth between our website and their website all day. Consider us as your super secure Venmo alternative. Learn more here.
  • Square: Best known for being straightforward and intuitive, good for small businesses, one-time pop ups for both in person and online. The chip reader costs $49, more robust versions cost up to $199-799. There is a 2.6-3.5% + $0.15 credit card transaction fee, and does require an integration to your website. Learn more here.
  • Shopify: Shopify makes sense if you've built your e-commerce store is on Shopify. POS starts at $29/month, with fees of 2.9% plus $0.30 per online sales, and 2.7% for in person sales. If you move to the $79/month plan, the rate drops to 2.6%. Advanced at $299/month drops to a 2.4% fee and $0.30. Learn more here.  
  • ShopKeep: ShopKeep is great for tablet sales, like at a restaurant or retail counter. Starting at $69/month, there are add-ons such as gift cards, hardware protection, integrations to sync inventory, plus a 1.3% transaction fee. Not built for e-commerce alone. Learn more here.
  • Intuit Quickbooks: If you already use QuickBook, it's great. It's a one time cost of $1,200 - which might make you balk - but it's not ongoing. There are additional fees, for transactions, or additional hardware like receipt printer and barcode scanner, etc. Go for it, if that's already your world for accounting. Learn more here.  
  • Vend: Vend starts at $99/month for 1 registrar, with no transaction fees. If you exceed $20,000 in revenue per month, you have to upgrade to the $129 plan or go enterprise. Not built for e-commerce. Learn more here.
  • Revel Systems: Revel is cloud based, so it is accessible from any website browser. Starting costs at $99/month (per register) with additional fees such as $50/month for e-commerce, 10% plus $0.10 credit card transaction fee, it is not built for e-commerce specifically, and has high fees. Learn more here.

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Which Businesses Need What:

 

What We Recommend: 

Switching from Venmo should not cause you any anxiety, when the time is right to change your payment system, it will feel like a natural step. First you need to decide if you require any hardware for physical transactions or if you want to keep it digital. Second, price out your options based on fees, ease of use, and additional costs. Third, email all of your clients with an update and if needed, any step-by-step details or guidance that go with your new POS. 

 

If you are doing in person sales like retail or restaurant where you need to keep track of inventory and products - Square is the most modern and straightforward point of sale system for you. 

 

If you are doing predominately e-commerce for product sales, including shipping and fulfillment - Shopify makes sense if you already have a site built on Shopify. If you are using a marketplace like eBay, Etsy, or other - you're covered. PayPal and Stripe are your next best options. 

 

If you are a service business, a one person business selling time or knowledge, for instance a personal trainer, consultant, or other, where you can do all of your point of sales online (in the same way that you Venmo now through a software), we recommend Bounce House with Stripe. With our intuitive user experience and interface, and ability to do multiple things from a single dashboard, we are proud to boast Stripe is also a PCI Service Provider Level 1 which is the highest grade of payment processing security

 

Here at Bounce House, we help one person businesses become more legit, for lack of a better term. Understanding boring point of sales systems, and other bland technology sucks. If you're interested to learn more on how you can build your website, manage customers, and get paid all through Bounce House - check us out!

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