I know what you are thinking, here we go again, another Merchant Services company claiming to save my business money on Credit Card Processing. I know most of you would agree that you are tired of Merchant Service companies contacting you about your credit card processing rates and even more tired of the high fee you are paying. Don’t worry I’m not here to talk about how our company is going to save you money on your credit card processing fees. I’m here to talk about how our company can help eliminate them.
Here is a little homework assignment. Next time you are at your office I want you to pull out that convoluted processing statement and run a simple calculation. Take the Total Fees you paid and Divide it by the Total Amount you processed in Credit Cards that month. Once you have that number Multiple it by 100. That will give you the overall average percentage you are paying to accept credit cards.
(Fees / Total Amount) * 100
I guarantee you are probably paying at least 2.5% or higher, that is 2.5% of YOUR PROFIT! Here is an example, say you have a location processing $50,000.00 per month in credit cards. The fees on average would be around $1,250.00 per month or $15,000.00 per year!
A lot of Merchant Service Companies will claim that they can save you a bunch of money on your credit card processing. The fact of the matter is all Merchant Service companies have the same relative cost. Around 85% of the fees you pay to accept credit cards are reimbursed to whom ever issued the card as Interchange Reimbursement Fees. So if Capital One issues your customer a Credit Card and they use it at your location, 85% of the fees you pay go back to Capital One. The real question you should be asking is, What else is in your Wallet?
That is where Our Company comes in. We can enable you to accept alternate forms of payment like electronic checks which will eliminate the percentage you pay on every transaction and replace it with a small flat fee. It does not matter if the sale is $50.00 or $500.00 you pay the same flat fee.
Take the same example of the location which was processing $50,000.00 per month in credit cards. If the average amount charged was $100.00 then that would be 500 transactions per month. With an electronic check program you would pay around $0.25 per transaction, which means you would only have paid $125.00 to run those transactions through ACH, 1/10 of the cost of Credit Card Processing!
I bet most of your customers are already using their check cards anyway, so either way the transaction comes out of their checking account making no difference to them, but a HUGE difference to your business. Of course there will always be exceptions where you will need to accept a credit card, but know that you should use it as a last resort not as a preferred method of payment.
Our programs support direct integration with multiple POS Software providers like Sitelink for all of you Self Storage facilities out there. For those of you without the option of direct integration we can offer a online based system to manage your automated recurring billing.
Adam Johanningmeier is the author of this article for Merchant Services. Find more information about Electronic Check Programs here.