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Education

The biggest threats to merchants The truth about
physical threats
have moved online It's easy to understand
why a robbery, struc-
By Barry Davis ture fire or hurricane
would be viewed as
Womply a top threat by mer-
chants running a phys-
or many small business owners, merchant-level salespeople (MLSs) are viewed as ical store. Most busi-
trusted advisors, not just salespeople. At Womply, we routinely hear stories of mer- ness owners see their
chants asking their MLSs to help them with everything from setting up a business physical property as
F website to staying Payment Card Industry Data Security Standard compliant and one of their most valu-
everything in between. This consultative dynamic is ideal for building stickier relationships able assets, and dam-
and increasing the lifetime value of every merchant account. To make it work, however, age to it is a traumatic
agents need to understand how a shifting business landscape affects small businesses and thought. But that's not
be prepared to offer actionable advice. true in most cases.

With that in mind, in The Green Sheet's Feb.12 issue, I wrote about the top concerns that keep Let's use a robbery to
small business owners up at night. In this article, I'll focus on a major industry shift in the illustrate the reality of
types of threats facing merchants and what MLSs can do to help their merchants adapt to physical threats. Ac-
these changing times. cording to data from
Insureon, fewer than 9
Imagine you're advising a small restaurant, a tire shop, a dental practice, a hotel or a nail percent of small busi-
salon in your area. In each of these cases, the business has a physical presence, including nesses were victims of
inventory or equipment. It stands to reason that the largest threats to that business – and, burglary or theft last
by extension, the merchant's livelihood – is physical damage to the property or a robbery year, so it's pretty un-
resulting in lost cash, right? common. When bur-
glaries do happen, the
On the contrary, a growing body of research suggests that online threats have a more imme- financial impact on
diate and dramatic impact on business revenue than physical ones. This matters because ac- the business averages
cording to Womply's research, small businesses walk a razor's edge with regard to revenue: $8,000. That's pretty
one in four would shut down within 30 days if sales stopped, and three in four wouldn't last significant, but a sim-
six months. ple, inexpensive securi-
ty system is all it takes
to drastically reduce
this risk. Insurance
takes care of the rest.
What about a more dra-
matic physical threat?
Coming off one of the
most active hurricane
seasons in memory,
Womply's data science
team analyzed transac-
tions at businesses in
affected areas of Hous-
ton and Florida last fall.
We found that in gener-
al business revenue for
merchants hit by hur-
ricanes in both regions
returned to normal
revenue levels within
a week after the storms
hit. Surprised? So were
we.

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