When Miki Nishihata opened Hello Bicycle in October 2008, he had some cool ideas for drumming up business. He stocked the quirky bike shop in Seattle’s Beacon Hill neighborhood with an ice cream machine and an espresso maker–big hits, of course. But he was missing one important feature: His was one of 26 million U.S. small businesses that don’t accept credit cards.
“Credit cards and me didn’t get along,” Nishihata explains, citing “exorbitant” monthly fees, long-term contracts, the cost of buying a card reader and the need for a dedicated phone line. As a cash business, he did OK, but felt he was likely losing out on some sales.
Then, a customer introduced him to the idea of mobile payments. “I heard about this thing called Square, and that all I needed was a smartphone and I could take American Express cards without anybody having to pay extra for it,” he says.
In January 2011, Nishihata signed up with Square, received a free card reader and began taking credit cards. The result? The number of transactions at Hello Bicycle doubled last year, and revenue nearly tripled compared to 2010. Further, he’s thrilled with the eco-friendly paperless system and his ability to track the shop’s transactions live from his office about 8 miles away.
Nishihata’s situation is not unique. Joey Garza, a sports massage therapist and owner of Houston’s Urban Therapy, joined the waiting list the moment he learned about Square. After getting his reader, he experienced a 10 percent increase in clients in the first couple of months.