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Allan Rayson

Allan Rayson

4 Options To Execute On The Newbie’s Guide!

To give you a head start on achieving success with your “Newbie’s Guide To Collecting At Least 97.45% of What You’re Owed!” we put together this blog post that outlines all the viable options at the hands of a club director, including pro’s and con’s to each option.

Of course, there is the cash and check option that an estimated 54% of clubs in the domestic U.S. are utilizing.  This option involves the parent paying with cash and/or check, which sometimes includes post-dated checks to the extent that a custom payment schedule needs to be accommodated. This option is the cheapest as there is generally no fee that is charged in the process of taking cash and check. This option can save as much as 2.90% (and sometimes more) in comparison to taking a credit card payment through one of the alternatives listed below.  However, this option does have unintended consequences that could be more costly than other options if things aren’t managed properly. These costs include the payments that remain uncollected at the end of the season, which for most clubs taking primarily cash and check can range from 8-12% (industry average in club sports).  This unintended cost is generally present because of the difficulty of tracking and reconciling cash and check taken at the gym either before or after practice.

The second option is PayPal, which we find is another common form of collecting a payment in addition to cash and check.  PayPal is a basic online tool that allows a club director to take a payment in varying amounts via their website or some other portal.  PayPal is a viable option for small clubs because the costs are generally low (~2.9%) and discounts are available to non-profit entities (~2.4%), which you sports clubs sometimes are.  However, the reporting tied to a PayPal payment is generally poor as a club director is often not able to tell which athlete the payment is tied to due to the fact that PayPal utilizes an individual email address to tie a payment.  PayPal is often utilized as a peer-to-peer (or individual to individual), but falls short in what is necessary for business to consumer transactions like those that take place within youth sports clubs.

The third option is a payments provider like ground.work that provides a payment platform similar to PayPal and seeks to automate all communication with parents (generally related to follow up on missed payments, declined cards or reminders of upcoming payments).  These systems are useful in some situations and generally with smaller, less sophisticated clubs. Costs range in the 3% range and are generally passed on to the parent, which in effect present a no-cost solution to the club.  However, automated emails have not proven to be a useful method of engaging a parent after a payment is missed or a card is declined. The burden is still shifted to the club director to handle human reachout necessary to engage a parent and get them to take action.

The fourth option is full-service platform like Sports Engine or LeagueApps where the payments platform is tied to a broader site hosting and registration platform.  These solutions are among the best available at being able to handle the process of registration along with collecting a payment, however they are expensive and often still leave a club director with the burden of following up on missed payments or declined cards (because they too rely on automated emails, which are an ineffective way to engage a parent.  Costs generally range in the thousands after the cost of designing and hosting a site (~$595), making the site function well on mobile (~$2,665 annually), onboarding fees (~$2,000+) and payment processing fees (range from 1.9% to over 3%).

Of course, there is a fifth option should you choose to have use manage everything for you.  We would certainly be excited about discussing this with you. We are currently working with volleyball clubs all over the country, generally those that have over 100 athletes with gross revenues between $350K and $2MM.  Please do reach out to us at sales@getpaidup.com or call (512) 518-4943 for a free pricing proposal.  Additionally, you can visit https://getpaidup.com/ to download our “Newbie’s Guide To Collecting At Least 97.45% of What You’re Owed!”

Allan is the father of three boys who are big time travel lacrosse players.  As a father and CEO of PaidUp, he totally gets what club directors and parents face every day as we try to provide the best for our children.  Allan is also a recovering banker so he grew up (professionally speaking) helping small businesses thrive! Don’t hesitate to pick his brain how to run a great club!  Allan can be reached directly at allan@getpaidup.com.

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