In today’s competitive software market, forward-thinking trade and field service platforms are no longer asking if they should modernize their payment infrastructure, they’re working diligently to source the right payments partner to implement innovative solutions before their competitors beat them to the punch.
Embedding payments and financial experiences is the next frontier for trade and field service software platforms looking to boost revenue while enhancing the customer experience. By taking control of your payment processing, platforms focused on the trades industry can unlock new revenue streams and gain a competitive edge.
Powering more profit for trade and field service platforms
Trade and field service businesses, from HVAC to plumbing to electrical and landscaping, process a high volume of transactions every year. As a result, leading platform providers in the space are implementing strategic payment solutions to help generate more revenue from their existing customer base, create stronger relationships with users, and streamline the payment experience for everyone involved.
The typical trade and field service business relies on revenue from sales and service to run operations, manage headcount, and drive operational growth. However, these profit levers alone may not be enough to help a business achieve its true potential.
Perhaps your platform is specifically designed for HVAC businesses and does everything from route management to inventory to CRM — all while processing and reconciling one-time and recurring payments. If you already have payments volume on your platform, you may be finding that these sales just aren’t generating the kind of revenue you need to scale. This is common when outsourcing payments. Instead, aligning with a strategic payment partner and embedding financial experiences into your platform is a way to increase your software’s potential.
There’s more to this strategy than just the nice revenue bump. Opting to embed payments empowers you to minimize friction for your customers, be better positioned for retention, and remain competitive in the rapidly evolving trade and field services space.
With the right payments partner, it’s easier for your trade and field service platform to successfully deploy, manage, and deliver recurring payments, as well as process a variety of payment types, card-present and card-not-present, and complex billing transactions — all while delivering a seamless user experience.
A payment solution that meets your customers’ exact needs has the potential to increase your revenue by 2-3x, create a stickier product, and increase the total enterprise value (TEV) of your software. Keep reading for a deep dive into how monetizing payments works for field service platforms and what you can do to ensure your success with software-led payments.
The ultimate power tool for building platform revenue
So, what does it mean to transform your platform into a revenue generating machine?
Let’s start by explaining a few key terms:
- Volume: The dollar amount of payments you are processing through your software in a given time period (monthly, annual, etc.)
- Processing cost: Cost to process the payments volume running through your platform.
- Vendor fees: Typical fees processors charge for an embedded payments solution.
- Interchange: Transaction fees set by the card networks (Visa, Mastercard, American Express, Discover) whenever a customer uses a credit/debit card. These are paid to the card-issuing bank to cover costs for fraud and the risk involved in approving a payment.
- Basis point: A simplified unit of measure that expresses percentages in finance.
- Net revenue: The margin to your platform via software-led payments.
Your revenue from software-led payments is the difference between the buy-rate from your payments provider and the go-to-market rate you charge your customers.
For example, let’s say your customers are processing $100M in payments on your platform. If your processing fees are approximately 3%, your total processing cost will be about $3M. Going a layer deeper, if your processing cost is made up of roughly 1.8% in interchange fees (which will vary by card brand) and 0.2% in vendor fees paid to your payments partner. As a platform, you can earn up to 100 basis points (or 1%) with the right software-led payments solution1. So, if you are processing $100M in volume on your platform, your net revenue from payments could be around $1M. As you can see, embedding payments can transform a platform’s potential.
1Your annual payments revenue opportunity range is estimated based on go-to-market pricing and estimated interchange fees.
Software success story: Planting the seeds for greater profit
When a cloud-based platform for lawn care, pest control, and pool care businesses approached Worldpay for Platforms with a vision to enhance their bottom line by helping their field service customers grow quickly, scale intelligently, and increase revenue, we knew we had the right payments solution for the job. By leveraging Payrix Pro, our PayFac-as-a-Service solution, this software platform was able to achieve their vision quickly all while delivering a superior product and customer experience.
The payment partner with all the financial tools you need
Monetizing payments may already sound attractive, but successfully scaling from where you are today to your maximum revenue potential requires a strategic approach. Choosing a payments solution is a step in the right direction, but it’s not the complete formula for success. Aligning with the right partner is paramount to getting your payments offering off the ground and operating properly.
Worldpay for Platforms has the expertise and experience to help trade and field service platform providers, like you, succeed with payments. Our team will help you establish a payments roadmap and timeline for integration. Together, we will thoroughly scope how you will enable payments on your platform and help you develop a monetization strategy to maximize revenue.
How you will get your customers to adopt your new payments solution will also play an integral role in accelerating your time to revenue. To move quickly, you must have a plan in place to generate adoption. Understanding the needs of your trade and field service customers and communicating the benefits of your solution through sales and marketing initiatives are essential to getting their buy-in early.
If you’re working with a payments partner like Worldpay for Platforms, the services and resources to support your short- and long-term vision are already in place. We provide an expert team that can take on the heavy lifting of maintaining payments technology and managing risk and compliance, if you choose, so you can focus on growing your business. With an all-in-one payments and financial solution and guidance at every step of the process, you’ll have everything your platform needs to unleash your full potential.
See what Worldpay for Platforms can do for your software
If you’re curious about embedding an innovative payments solution into your platform, now is the perfect time to go a little deeper.
Get started by grabbing a copy of our software payments buyer’s guide or scheduling time with the team at Worldpay for Platforms to see where you can go (and grow) with software-led payments and more.
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