Payment Strategies

Global Urban Collectivehttps://www.facebook.com/groups/globalurbancollective/

Agenda1) Foundation Strategies2) Payment Method Strategies3) Setting Up Shop4) Payment Overview5) Business Payment Scenarios6) Takeaway7) Discussion

Foundation Strategies

Payment-Orientated BusinessDo not develop a business around your passion. Build your business around a payment strategy.

A payment strategy is more important than the business model itself.

Some payment methods are better than others.

Your Entrepreneurial Goal

Create the best payment strategy and build business models around it.

Find Fastest Path to a Transaction

Marketing Mentality

View Ad

Respond to Ad

Visit Business

Make Purchase Decision

Conduct Transaction

Transaction Mentality

View QR Display

Scan QR Code

View Item

Checkout Transaction

Method Strategies

Payment Methods

Legacy TransactionsInvoicing | Cash | Card | Check | Wire Transfer

Digital TransactionsOnline Checkout | Peer-to-Peer | Tokenization | Prepaid

What’s For Sale?Tangible GoodsPhysical Item | Professional Service | Time and Labor

Intangible GoodsMembership | Subscription | Digital Asset | Web Service

Payment Method StrategyBest Payment StrategyRecurring Subscription for Membership

Not Best Payment StrategyCash for Time and Labor

Setting Up Shop

Business StructureIndividual - Avoid at All CostPersonal Tax & Liability | Only Short-Term | Only Small Transactions

Partnership – Avoid at All CostNon-Essential Personalities | All-or-None | The Hard Way to Learn

Corporation – PreferredLeverage Shares | Separate Entity | More Paperwork

Business AssetsLocation UPS Store for Address | Mail Forwarding | Virtual Office (Expensive)

CommunicationVoicemail | Email | Web Site | Social Media | Logo

FinancialBank Account | Recordkeeping | Receipt | Invoicing

ComplianceLiability Insurance | Business License | Tax ID

Discussing Payments

Cash PaymentsUnder the Table OperationAvoid Taxes and Garnishment | Avoid Child Support | Hand to Mouth

Physical ManagementCost to Transport | Cost to Store

ATM Machine Problem$20 Bills | Run out of $5 and $10

Offer As a Secondary Payment Method, Not MainDigital Transactions More Scalable

Invoicing MethodSent out invoice with Net 30 Term

Establish Account Receivable = Asset Receive Cash, Check, Credit Card, Money Order, MoneyGram

Utility Bills and Insurance.

Merchant AccountProcess Credit Card and Debit Card Payments

Payment Processor – Banks, Processor Firms

Payments As A Service (PaaS) – PayPal, Amazon

Settlement, Chargebacks and Disputes

ACH / Direct DebitElectronic Check Processing

Preferred Method for Subscription Service

Use for Recurring Intangibles

Not Attached to Business Model

Wire TransferHigh-Priced Items (Yacht, Airplane, Rare Painting)

International Payments Between Unknown Parties

Cannot Be Reversed Unless Error in Transmission

Third Party SellersSell Product and Process Payment (Amazon Kindle)

Sweep Funds into Account

Easiest to Setup

Payments Patterns

One-Time PaymentCustomer Pay For Item(s) and Go Away

Tangible transactions

Linear growth

Recurring SubscriptionSignup Members With Application and First Payment

Automatic Withdrawals on Dates

Separate from Core Business – Allow or Deny Access

Number of Subscribers = Asset

Prepaid AccountCustomer Load Up Account With Cash, Check, Credit Card, Etc.

Customer Conduct Transactions From Prepaid Account

Used for Rapid Transaction Scenarios

Public Transit, Arcade and Casinos, Food Festival, Etc.

Online Gaming, Online Gift Cards, Loyalty Points Etc.

Digital WalletSimilar to Prepaid Account

Encrypt Credit Card and other Account Numbers

Decrypt and Present Numbers During Transaction

Faster Path to Checkout

Rental HoldCredit Card – Place a Hold on Account for Funds, Credit Deposit

Debit Card – Charge Amount + Deposit. Credit Deposit

Separate From Business Model

TokenizationDigital ID = Currency Amount

123ABC444 = $5.00 stored in database

Enter numbers on back of gift card or long distance phone card

Lottery scratch-offs operate in this fashion

Reverse Raffle Example

Business Scenarios

Hair Salon

Cash Card

One Time Prepaid

Recurring

Third Party

Food Truck

Cash Card

One Time

PrepaidDigital Wallet

Digital Publisher

Cash CardDirect Debit

One Time Prepaid

Recurring

Digital Wallet

Digital Token

Third Party

Event Vendor (Table/Canopy)

Cash CardDirect Debit

Wire Transfer

One Time Prepaid

Recurring

Digital Wallet

Rental Hold

Digital Token

Third Party

Gym Club

Cash CardInvoiceDirect Debit

Wire Transfer

One Time Prepaid

Recurring

Third Party

Pop-Up Shop

Cash CardInvoiceDirect Debit

Wire Transfer

One Time Prepaid

Recurring

Digital Wallet

Rental Hold

Digital Token

Third Party

Micro-Festival

Cash CardInvoiceDirect Debit

Wire Transfer

One Time Prepaid

Recurring

Digital Wallet

Digital Token

Third Party

Handbag Rental

Cash CardInvoiceDirect Debit

One Time Prepaid

Recurring

Rental Hold

Product of the Month

Cash CardInvoiceDirect Debit

One Time Prepaid

Recurring

Rental Hold

Digital Token

Third Party

Hair Extensions

Cash CardDirect Debit

Wire Transfer

One Time Prepaid

Recurring

Third Party

Wrapping Up

Take AwayBuild the Best Payment Strategy, Then Build the Business Model

Look at Strategies Separating Payments from the Business Operation

Create a Corporate Structure

Assets are Members and Account Receivables, Not Sales Figures.

Questions / Discussion

End of Presentation

Global Urban Collectivehttps://www.facebook.com/groups/globalurbancollective/