Exclusive: ‘Keep calm and carry on trading’ – Peter de Souza, SumUp in “The Paytech Magazine”
SumUp, the payment solution for microbusinesses, pivoted during the pandemic to provide merchants who had been forced to shut up shop with a suite of online transaction services. For some, it’s proved transformational, says the company’s Peter de Souza
Like many small traders in Italy, COVID restrictions threatened to put Marco the parrot seller out of business – just as demand for pet birds during lockdown was taking off.
With no visitors allowed to his store and no means of taking payments other than face to face, he turned to small business payments provider SumUp to help him launch a ‘parrot post’ – a home delivery service, with transactions facilitated by text message. Now, he says, parrots are literally flying out of the door.
Marco is testament to the resilience of millions of microbusinesses that, despite the initial confusion, panic and doom, have found ways to survive – even thrive – during the pandemic, because technology, in the form of new payment channels and solutions, has come to their rescue… when the going gets tough, as they say, you’ve still got to keep the cashflow going.
That’s not to play down the catastrophic impact the pandemic has had on small businesses. In the UK alone, 234,000 of them have already permanently ceased trading since the start of the crisis. And of those left, a study by Simply Business found that 67 per cent had suspended trading at some point in the last six months, suffering an average loss of around £11,000 (this jumps to £21,000 in the hospitality sector).
When you consider that SMEs account for 99 per cent of all UK businesses, contributing a combined £2trillion to the economy, and are responsible for 60 per cent of all employment, it’s clear that those individual tragedies affect all of us.
But a recent regional report from Lloyds Bank gives grounds for optimism. It shows that a whole host of businesses have embraced new ways to trade – specifically by going online. Half of them, the report finds, would have ceased trading without it, with almost a quarter moving online for the first time. Moreover, a third said they had increased their online trade since the pandemic started. Another third reported cost savings from using it, while half said the internet and digital adoption had helped simplify their businesses.
SumUp, which was launched specifically with the payment needs of micromerchants with up to 25 employees in mind, has responded to this rapid change in fortunes with a new suite of service options.
Founded in 2012, SumUp operates in 33 countries, and is backed by the likes of American Express, BBVA (Banco Bilbao Vizcaya Argentaria), Groupon and Holtzbrinck Ventures. Originally, it largely focussed on face-to-face, physical payments, but with this year’s increased abandonment of cash, it has transformed its offering, providing additional tools and partnership services.
SumUp’s head of demand generation for sales and partnerships in Europe, Peter de Souza, explains: “Early in 2020, we expanded into multi-channel payments, which means we now offer an online store, we have payment links and invoicing, and even a SumUp card.
“What this means for all different types of businesses – the coconut seller in São Paulo, the taxi driver in Berlin, the café in London – is that they can not only accept card payments, but do it from anywhere. All it takes is connectivity with a card reader or mobile device, and customers can pay them however they want to. That’s the key change.”
It’s clear that 2020 has been as transformative for this company as it has for the micromerchants it serves. In March, it introduced SumUp Invoicing and Mobile Payments, but it was the launch of the SumUp Online Store that de Souza regards as the real game-changer. The SumUp Store comes in various forms. The Starter Plan version is a stripped-down, simplified model of an online store, allowing microbusinesses to display their products or services and take payments through various social media channels, including Instagram, Facebook, Messenger and WhatsApp.
The interface is familiar to customers used to shopping online and the entry-level option allows for tracking of all sales and a user-friendly customer order history. The service is subscription-free and charges 2.5 per cent per transaction.
The Professional, Advanced and Premium Online Stores subscription charges start at £9 per month, with transaction fees ranging from 1.95 per cent to 2.5 per cent. For this, SMEs can quickly set up and design their own online stores and enjoy email and notification features, online payments, product catalogues, customer management, marketing and social media functions, and employee accounts – to name but a few tools.
The new services also incorporate the SumUp Card, which is powered by Mastercard and allows small businesses easier and quicker access to their funds.
“We really upped our game this year,” says de Souza. “We saw the opportunities and the genuine demand from microbusinesses. Our role – or mission if you like – is to create a world in which businesses are really successful in doing what they love. We believe that providing a variety of solutions, including ecommerce, offers these customers huge help by enabling them to do exactly that.”
It has allowed Goodeats, for example, to integrate an online takeaway ordering and delivery fulfilment solution with its SumUp account, allowing eateries to offer collections, deliveries and table ordering, while enabling customers to pay in various ways.
“We’ve seen some pretty cool and creative stuff out there,” says de Souza. “Bricks and mortar businesses are utilising our Online Store products to expand into ecommerce and delivery, to keep their businesses moving.
“For instance, in response to COVID, some cafés have securely fixed our card reader and a mobile device to their shop windows, so that people can order outside and pick up at the door. Amazing stuff.”
Removing barriers to pay
SumUp currently serves three million merchants globally, and claims to have 5,000 businesses joining every day – not solely due to the impact of coronavirus, although COVID-19 has admittedly accelerated a change in habits that has been developing for years. The phrase ‘cash is king’ used to hold sway. Today, contactless or virtual payments have comprehensively taken over.
“We recognised that there was this huge and underserved market of micromerchants who were struggling to find suitable access to traditional payment services,” says de Souza of the company’s original aim. “We wanted to democratise payments,
making services available to even the smallest of businesses, taking away the barriers of cost and complexity.”
This meant allowing merchants to pay transaction fees without a contract, with access to inexpensive mobile payment terminals that work with a powerful free application, so that they weren’t paying for a terminal they were not using.
“The cashless revolution is moving quickly,” confirms de Souza. “Only a decade ago, in the UK, 60 per cent of payments were made using cash, and coins. Then, in 2017, we saw debit cards overtake cash as the preferred payment method, and, since then, you’ve had lobby groups like UK Finance projecting that cash could actually make up only 10 per cent of payments by 2028. So, I think the pandemic has just fuelled trends that already had momentum.”
If the momentum is there, what can we expect from SumUp in the future?
“Our microbusinesses are being empowered by the pure influx of choice we provide,” says deSouza.
“Flexibility and simplicity are everything and I’d like to think we are just scratching the surface of the opportunities out there. We will see more cool things happening in terms of personalisation, rich media and artificial intelligence, which will further develop retail and ecommerce. And there is the potential for 10 per cent of the population in every European country to become a SumUp client – who wouldn’t be excited by that!”
Who’s a clever boy, then?