The basic idea of an ATM isn’t complicated: give customers an easy way to get cash and you’ll attract customers, increase spending in your store and earn surcharge revenue — never mind the savings on bad checks and credit-card transactions.
But taking some time to think about how and where to use your ATM will help you get the most out of it.
A recent report on ATM site-planning offers an idea of what’s involved. It focuses on banks, but many of the concepts also apply to retail locations. For example:
Placement. Is the machine visible and accessible? Can people use the machine without getting in the way of other customers? Is there enough space to accomodate a small line of people waiting to withdraw cash?
Security. This involves two aspects: security for customers, and security for the machine itself. If the ATM is inside the store, is it visible to the desk clerk or security cameras? Is the area around the ATM open and well-lighted? If the ATM is outside, is it bolted down or in a locked enclosure? If the ATM is hidden from view, it puts customers at risk and increases the possibility of attempted theft.
Advertising. Do signs clearly and prominently advertise the existence of the ATM? Do interior signs clearly direct customers to the machine? If customers don’t know you have an ATM, they won’t stop in to use it. If the ATM is hard to find, fewer people will use it. Proper location and signage work together to maximize ATM usage.
Regulations. Standalone ATMs usually don’t require permits — just hook them up inside your store and you’re ready to go. But anything that involves construction (like through-the-wall ATMs) or external structures (like ATMs placed outside in kiosks or other enclosures) is probably subject to zoning and construction laws. Check with your city’s building inspectors to find out what is needed and allowed.
Power and communications. Every ATM needs two things: a power supply, and some way to communicate with transaction processing networks. Keep that in mind when picking a location. Consider the ease/cost of running power and either a phone line or Internet connection to the desired location. If that’s a problem, or if you just want more flexibility, consider a wireless option. You still need the power supply, but by using cellular phone networks for communication you save on the cost of running a communication line, and you can place the machine anywhere you can run a power cord.
The article goes on to discuss the implications of changing consumer behavior: notably, the total comfort that people under 30 have with doing all their financial business through ATMs and kiosks. ATM owners that are ready to serve that population will benefit the most in the coming years.
Nicole Sturgill, of TowerGroup, noted that self-service financial transactions have expanded to include both the traditionally underbanked as well as consumers who may have lost access to credit or bank services through recent hardships. The growth of prepaid debit for payroll and money transfer has fueled the resurgence of cash.
“At both ends of the spectrum we are seeing the transaction volumes at the ATM going up fairly quickly,” Sturgill said.
Another factor driving the advancement of ATM functions just may be a generational shift. Consumers under the age of 30 or so have grown up using self-service machines in restaurants, airports, grocery stores and many other venues. With direct deposit of paychecks, online banking and debit cards, many young consumers may never set foot in a traditional bank branch.
And that means opportunity for non-bank ATM owners.
So take a few moments to think about how an ATM fits into your business model. Then find a location that minimizes installation costs while maximizing usage, and watch your ATM become a pillar of your business.
