Why I Don’t Like Personal Checks – (Rant)
I’m not a big fan of getting paid by check. And no, it’s not that I’ve had a problem with bad checks (in fact, I’ve only ever had one check bounce in all the years I’ve dabbled in different service based businesses).
The problem I have with being paid by personal check is that it takes more than a week for my bank to release the funds. Sure, it shows up in my balance, but if I try to make a withdrawal it won’t acknowledge the money that’s sitting there unless it’s been there a week or more.
My second problem with accepting personal checks is that I frequently receive very generous tips from my customers in my window cleaning and gutter cleaning businesses. If the job comes to $120, I can usually count on a $10 to $20 tip. That’s providing the customer is paying cash. If they pull out their checkbook at the end of the job, I know right away that I’ll be getting the exact amount and not a penny more.
Of course, no one is entitled to be paid extra for a good job, but it does happen very frequently if the person is paying cash. I’ve even had repeat customers (that have paid in cash and tipped very well in previous years) pay by check and not include anything extra.
What’s the psychology behind all that?
Okay, that’s the end of my rant. That’s my take on receiving personal checks. Cash is just so much easier to work with. And I’m not talking about tax evasion, because that’s just wrong. I’m talking more of a convenience factor for both me and my customer.
Now here’s the rub: If you don’t take personal checks and you are running a service-based residential business, that only leaves cash or credit cards. Most one-person operations don’t have a merchant account of their own. And even if they did, they would lose a small percentage of the total sale each time they processed their customer’s bill. This can really cut into your bottom line.
What about PayPal? Yes it’s easier to accept credit cards through PayPal if you’re a one-man operation, but they take an even larger percentage of the total sale.
So that leaves you with only one method of payment: Cash.
Unfortunately, if you decide that you’re only going to accept cash for all your jobs, you’re going to lose a lot of business. Some people simply don’t pay in cash for home services. Maybe they feel that a check gives them a few extra days just in case something goes wrong with the work. The option to put a stop payment on the check is their little bit of insurance. Another reason people don’t pay cash is that they don’t want to contribute to the underground economy. Sadly, service and tradespeople get a bad rap because of a few bad apples that are determined to make money under the table.
So what’s the bottom line? Well, even though I have a dislike for checks, I also realize that I’d lose a lot of business if I didn’t accept them. It’s all part of doing business.
