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Your Life & Business in the Cloud – Square

Your Life & Business in the Cloud – Square

Business happens everywhere now and business owners are no longer tied to their desk or a storefront. To enable this they need technology that allows them to sell from wherever they are. That’s where Square comes in. Square is a payment terminal with a twist –they have a cloud based Point-of-sale system (POS) integrated into the merchant terminal to record all of your sales.

You’ve probably seen Square at your local coffee shop or market. The card reader either comes in a white “square” dongle that you put into the earphone jack on your phone or iPad or you can use the iPad holder that has the card reader built in which you mount to a countertop or desk.

Why go with Square instead of a traditional service from one of the big banks? There are pros and cons to both.

Square has no monthly fee which makes a big difference if you don’t know how many transactions you will have in a month or if you have a lower volume of transactions. Two examples of how it works for transactions are below (using the current Square fee of 2.65% and approx. Bank Merchant Terminal system fee of 1.5%):


Square comes with a full POS system included in the fees. This means that you don’t have to pay for another piece of software to manage your sales. This makes your end of day much easier as you aren’t reconciling between two systems –your payment terminal and POS system –you are just reconciling your cash and money in the bank to one system –Square. Square also allows multiple locations under one Square dashboard so you can see all of your sales in one place. This includes allowing you to sell on their online site or integrate with third party e-commerce sites like Big Commerce to set up your own online store.

Square integrates with many other useful apps for your business including accounting software such as Xero, Quickbooks & Kashoo. With Xero, Square creates two daily sales invoices in Xero –one for sales paid by credit card that settle through Square and another for sales paid by cash or other payment methods. Xero uses two clearing accounts –Square Cash clearing and Square Clearing to track the difference between the sales that have been recorded by the entries received from Square and the funds that have been deposited to the bank per your Xero. Quickbooks Online allows Square to pull in the category and item amounts in the sales for the day to help with inventory tracking.

As always each decision you make about software for your business has trade-offs. Choosing a payment terminal is no different. With Square one of the major cons is at the moment in Canada there is not the option to accept debit. Depending on the type of business you have this could be a deal breaker. Having said that we still have many clients using Square and we use it ourselves. Some clients choose to have a payment terminal from the banks as well to allow them to accept debit but still run credit cards through Square and/or use the POS functionality in Square.

Fees for Square are 2.65% per transaction swiped and 3.4% +15 cents per keyed-in transaction. This can be significantly higher than fees charged by the payment terminals from the banks which can start as low as 1.5% usually plus a fee to rent the terminal. It’s really a question of pricing everything out for your situation remembering that the banks don’t provide a POS system which can be a significant extra cost, especially for small business.

Square is a great app for small business, easy to use, easy to setup and with no contract and no monthly fee. It plays nicely with lots of other technology to help your run your business and accept payments from anywhere, anytime. We use it ourselves during tax season to make it easy for our clients to pay us when they come in to pick up their returns and we recommend it to clients. Questions about how Square integrates with Xero? Give us a call.