Why The Con Men Need A Contract

If a deal looks too good to be true, you really should ask yourself why. And if that smooth-talking sales guy with the Don Draper vibes needs you to sign a contract in the point of sale and payments industry, it's likely a con. Thankfully, you'll have plenty of no-contract alternatives to choose from.

About 15 years ago, the shift from on-premise software to cloud computing changed almost everything in the software industry. The costs of implementing software plummeted as hosting costs became almost zero, letting smaller businesses adopt complex systems that were previously far too expensive for them. Self-adoption became the norm, whereas before it would take a team to install your software solution, now with apps and cloud delivery, people with little technological experience could implement systems themselves.

This major shift in how software was made coincided with the rise of 'freemium' licensing (e.g., software that is free until a certain limit) and also, most importantly, zero-contract software. Dubbed 'honesty ware,' no-contract software solutions have become prominent in the point of sale, payments, accountancy, design, and almost every other vertical of the software industry.

Why should you insist on zero-contract solutions?

The fallacy is that signing a contract allows the vendor to give you the best possible price as you are guaranteeing them future business; in reality, nothing could be further from the truth. In days gone by, changing pricing, upping subscriptions, or anything else mid-contract was difficult to do as it would generally require changing a direct debit, having a customer pay an invoice, or similar. Basically, there was no tie-in without the customer's intervention or permission.

In the modern era, it's as easy as sending an automated email, pointing you to the small print where they have reserved the right to change pricing at any time or worse, not even telling you of pricing changes until you see the payment has left the bank. Too often now, contracts are there to allow you to get tied in at a low price which will hike intermittently, at the very least, throughout the contract to the 'real' price. This is particularly prominent among unscrupulous point of sale and payments vendors, so much so in fact that the Payment Systems Regulator in the UK had to legislate against it in 2021 in an attempt to stop contracts from running over 18 months and to make quotes easy to read for the end customers.

You know that an industry is not to be trusted when honesty has to be legislated, right?

Conversely, zero-contract providers such as AirPOS, Square, and Zettle are in a relationship of shared risk with their customers. If they've told them anything that is untrue, their customer can simply cancel at any point; they're not held in by anything. It's an honesty clause and an important one as it sets up a much better relationship for the long term.

This really allows the software vendor to plan longer-term and especially allows them to keep their pricing down accordingly as they will have a long relationship with that customer and the opportunity to grow together in the future. With trust established, the customer will likely be happy to pay them more for helping them to develop their business. Everyone wins.

So, top of that list of requirements for your point of sale and payments solution should read zero contract. Otherwise, we'll see you after 18 months of broken promises, price hikes, and snake oil when this article will really make sense.

If you'd like a zero-contract, subscription-free, and honestly priced point of sale and payments solution, give our free account a go at AirPOS Pay.