As a gym owner, managing monthly payments efficiently is crucial for consistent and predictable cash flow. The two most popular options for handling transactions are credit cards and ACH payments.
ACH stands for “automated clearing house” and is the primary system used for electronic funds transfer (EFT). While you might be partial to one over the other, each method actually has its own benefits to consider.
Welcome to the Gym Growth Blueprint Series! We asked gym owners, “What’s the one piece of advice you’d give a new gym owner?” As gym owners ourselves, the PushPress team is passionate about helping others succeed.
Today’s feedback comes from PushPress founder Dan Uyemura. As a former gym owner himself, Uyemura knows a thing or two about the topic. When asked what he would choose if he were opening a gym today, he said he’d choose credit cards because he optimizes for speed and knowledge. On the other hand, ACH payments can make you wait up to five days for the payment to clear. However, for gyms looking to optimize for costs, Uyemura says “ACH is a massively more cost-advantageous payment rail.”
So, what’s right for your gym? Ultimately, it depends. Let’s dig a little deeper!
Three Pros to Consider with ACH Payments.
1. Set it and Forget it.
Not only do credit cards expire every few years, they can get lost, stolen or compromised. But you don’t have to worry about those things with bank accounts. So, once you set up ACH payments for someone, you shouldn’t ever have to chase them down for new info. In this sense, once ACH is set up, you can usually decrease admin work and stress.
2. Lower Fees.
As Uyemura explained, ACH transactions have lower fees compared to credit card processing, which can be as high as 3.5 percent.
PushPress currently offers ACH at 0.8% + 0.30 per transaction on ACH payments. This is considerably lower than credit card fees (currently PushPress range is 2.75 percent to 4.19 percent plus .30 per transaction).
For gym owners who process a high volume of recurring payments, fees can add up quickly. For example, let’s say you have 150 members paying the suggested gym membership pricing of $200/mo. Uyemura explained that choosing ACH over credit card would save you $630 a month, or $7,560 annually. That’s some big savings for a boutique gym owner.
3. Reduced Chargeback Risk.
ACH payments generally have fewer chargebacks than credit cards. Which means there’s less risk of disputes or fraudulent claims. For the gym owner, this can mean a bit more stability and predictability.
The Pros of Credit Card Payments.
1. Immediacy.
As Uyemura pointed out, ACH payments can sometimes take up to five days to process, while credit card transactions are immediate. This can make a difference in your expected cash flow. For instance, you would know right away if payments didn’t go through for those members that are billed at the end of the month. Which is better than finding out a few days into the following month that a handful of payments bounced, leaving you low on cash flow and wondering how you’ll cover payroll.
2. Convenience for Members.
For any large or recurring monthly payments, people often prefer using credit cards so they can get points or rewards for each transaction. In addition, entering credit card info often makes for a quicker signup process than the verification steps for ACH.
3. Increased Retail Sales.
While this is an option for ACH payments as well, it’s worth pointing out that the purchasing process for PushPress gyms is incredibly simple. Since payment info is stored in the software, members can easily purchase merchandise or supplements with Product Sales in the Staff App. And this might allow you to increase gym revenue on top of membership sales.
Don’t Forget About PushPress Flex Fees.
Flex Fees allows you the flexibility to apply customizable transaction fees. So, what does that mean for your gym? As discussed above, any time you currently process a credit card or ACH payments, there are associated fees. Flex Fees gives you the option to pass the fee on to your members. Though the fee may seem insignificant on either end, it can really add up for your business.
Want more details? You can read more here about PushPress Flex Fees.
Pro Tip: Want to learn more about how PushPress can help you with more efficient gym operations and growth strategies? Book a demo with our team today!
In Summary: Choosing ACH Payments or Credit Cards Simply Depends on Your Gym
Choosing between ACH payments and credit cards for your gym’s transactions involves balancing various factors to meet both operational needs and member preferences.
ACH payments offer cost-effective, reliable solutions for managing recurring membership fees with lower transaction costs and reduced chargeback risks. They are ideal for gyms seeking stability and efficiency in handling regular payments.
On the other hand, credit cards provide immediate processing, flexibility and enhanced member convenience. This makes them a strong choice for one-time purchases and attracting a broader clientele.
Ultimately, the decision should align with your gym’s financial goals, member needs and operational capabilities. By carefully evaluating the pros and cons of each. That way, you can implement a system that enhances your financial management. Plus, it supports a seamless member experience and contributes to your gym’s long-term success.
