Welcome! Thanks for stopping by

Posted on August 16, 2011 by Michael

I’m assuming that since you are on my site, that you are either a merchant, accountant or a new merchant services rep that has a desire to learn more about credit card processing.  Hopefully, your visit today won’t be disappointing.  Take some time to read a few articles but, most importantly, fill in the form at the right and subscribe to my FREE email course.  This course was originally being sold nationally for $47, and received great acclaim.  I felt that offering it for FREE would open up the opportunity for more hard working business owners to expand their knowledge.  By the time you’re done with it, you’ll know more than probably 80% of the reps contacting you.  The easily digestible lessons are spread out over approximately a month so as to not be overwhelming.  I’m confident you will find the knowledge gathered to be extremely helpful so why not take it for a spin.

It’s unfortunate that in the world of credit card processing, there are numerous reps that are….well, let me just say, less than ethical.  Typically, it’s not their fault as they have had less than stellar training.  The bottom line is this….all processors have the same cost so, consequently, every one of them could, theoretically offer the same pricing to you.  But, what happens when a rep walks thru your door….”I’ll bet I can offer you better rates than you’re currently paying“.  They mostly focus on rates, don’t they?  Sound familiar?  Well, honestly, it’s not just about rates and, as a merchant, that shouldn’t be your focus either.  Ask lot’s of questions of those trying to sell you and, in addition, be cognizant of how many questions they are asking you about your business and how you transact business.  Are they truly interested in offering and providing “solutions” or are they primarily interested in just “selling” you?  My success in this business has always been by developing, and maintaining, mutually rewarding relationships.  That’s what you should be looking for and hopefully, you’ll discover information here that will be beneficial for you.

Keep in mind that while I will never actively solicit your processing business here, I am available to answer any questions that you may have regarding your current relationship and am more than capable to provide solutions for increasing your business and, subsequently, your bottom line.

While this site is primarily about merchant services, you will frequently find articles posted discussing other marketing and business ideas that I have found to be beneficial to business owners.

So, with that said, welcome and thanks for coming by.  If you have any specific questions or comments, please post them here.  If there’s a business relative type topic that you’d like to see covered, please let me know.

To Your Continued Success

P.S.  If you’ve found the content on this site, or in my ecourse, to be helpful or enlightening, please share it with others utilizing the helpful buttons at the bottom of each article.  Thank You!

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Total Transparency in Credit Card Processing

Posted on January 25, 2012 by Michael

Is your current credit card processing provider being totally transparent with you regarding the services you are paying them for?  In the past, I’ve written about the frustrations that I have experienced in just how little merchants seem to know about their credit card processing services.  When in the field, knocking on doors, introducing myself and services, I was often just ignored or the merchants just simply didn’t want to talk with me.  I totally understood why since, unfortunately, there are many in our industry that have given us a bad reputation due to deceptive or vague sales “pitches” just to get the deal.  Many merchants have been burned in the past and as a result, have turned a deaf ear and often formed a very callous opinion of merchant services reps.

There are, however, some of us that truly do want to make a difference for the hard working merchant and be totally transparent with them.  The hardest part is, of course, getting their willingness to just spend some time with us.  Typically, I would start out by simply asking somewhat probing questions.  The recent Durbin Amendment legislation has provided for a good “ice breaker”, if you will.  Here’s some examples of the types of questions that I ask.  Are the people coming thru your door approaching you in this manner or are they simply saying they can “save you money“?

Example 1 “Has your current provider informed you about the recent passing of the Durbin Amendment and the huge savings available to you on your debit transactions?  Are they passing those savings on to you or keeping them for themselves?

Example 2 “Do you know exactly what rates you’re paying for all the different card or transaction types that you process in your business“?

Example 3  “Since a good majority of cards being used today are some form of rewards card, do you know exactly what you’re paying on Visa Rewards 1 and Visa Rewards 2 type cards“?

Example 4  “Have you noticed any miscellaneous fees on your bank statement called something like PCI fees that aren’t showing up on your processing statement“?

Example 5  “Is your current provider charging you monthly, annual, or both PCI fees and do you know what you are getting for that“?

Example 6  “Beyond your credit card processing, has your current provider mentioned other marketing ideas or new technology that may be of benefit to the growth or efficiencies of your business“?

The bottom line in all this questioning is to just indicate to the merchant that these are things that they absolutely should know.  If they aren’t fully aware of all they are being charged for, there is the possibility that they are not getting the best deal possible for their business.  Quite frankly, there are lots of reps and ISO’s out there that I know of that count on merchants never really looking at their statements in any great detail.  In fact, many statements are very difficult to decipher for the untrained eye….by design.  One thing that you, as a merchant, should always do, is have your rep come in once you’ve received your first statement to go over it in detail and make certain that it is all you signed up for and nothing more.  In fact, when your new rep suggests this up front to you when signing the paperwork, it’s a good indication that they really care about the relationship.

So, to stress once more in this article, merchants should demand total transparency in their credit card processing services, as well as any service they are paying for.  Ask lots of questions and don’t sign on the dotted line until you are confident that you thoroughly understand all the fees and costs of doing business.

Well, as always, I hope this information has been informative and enlightening for you.  Please pass it on to others that you feel will benefit as well.

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Get a FREE iPhone 4 or Droid X…Which Do You Choose?

Posted on January 20, 2012 by Michael

You know, with all that is going on with mobile these days, and more people accessing the internet with mobile devices, it makes you wonder which of the available devices receives the highest praises.  As you know, from articles I’ve run here, I’m very high on the prospects of mobile marketing from a business standpoint.  Mobile is a great way to make contact with potential customers and generate increased sales.  But, until just recently, I hadn’t considered much about the difference of the phones available.  Which do you use or are you considering getting?

I ran across this site below and thought my readers might be interested in checking it out at well.  Let me know what you think.

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Credit Card Interchange Rate Reductions…Possible or not?

Posted on December 15, 2011 by Michael

In October, the Durbin Amendment went in effect and now retailers are pocketing additional profits….or are they?  As you may know from reading other articles, Durbin put a cap on what processors are charged for processing debit  transactions.  Now, the current cap is $.21 and $.05% which is about half of what it was in the past….a huge reduction.  As a retailer, if you are on Cost-Plus Pricing, you will automatically be benefiting from these lower fees.  So, for example, let’s say you are on Cost Plus .25% + $.10, your total fees on debit transactions will now be .30% + $.31.  To put some concrete numbers to it, a $35 sale would cost you $.415 or $.42.  If, however, you’re not on Cost Plus Pricing, then likely, your processor is pocketing the increased profits and well,…we should talk.

As consumers, we hope that these reduced costs to retailers, would translate into lower prices at the checkout.  That hasn’t really materialized much yet but maybe it’s because of the holiday shopping season.  Maybe in time, we see some reductions but then again, how beneficial will it really be.  If you’ve been staying up on this topic, you’ve seen many articles on the net about the loss of revenues to issuing banks due to Durbin and they are assessing or looking to assess more fees to their card holders.  So, while we may be saving on the retail end, we may be paying for it on the other end.  Quite the system huh?

Now that Durbin has been put into play, there seems to be grass roots endeavors by retailers to push for another round of regulation by reducing credit card interchange rates.  How likely is this to come about in the near term is anybody’s guess.  Personally, I’m thinking it’s not going to happen especially since we’ve already seen how the Durbin rules are potentially hurting consumers.  That is specifically what this article is here to address…at least from my perspective.

Let’s take a look at it.  When Durbin went into effect, issuing banks lost revenues….big time.  The banks shareholders don’t like seeing profitability drop so naturally, the banks  look for ways to recovers lost profits by raising fees elsewhere.  More than likely, if credit interchange regulation were to take place, we’d see the same scenario play out with the issuing entities.

Credit, you understand, is a bit different than debit.  First, issuers of debit assume very little risk in providing debit availability at the point-of-sale.  Alternatively, when a credit card is used, the issuer extends unsecured credit to the consumer and hopes to recover the funds at a later date.  Issuers that extend credit have more costs overall like bad debt expense, rewards that they pay out, fraud risk and processing fees.  So, inherently, banks are assuming real risk each time a credit card is approved. 

So, to summarize my thoughts on the topic, I find it highly unlikely, especially in the near term, to see any significant movement in credit card interchange reductions.  Without  a reasonably healthy interchange structure, banks would be at increased risk of losing money.  Consequently, issuers would raise annual fees, raise interest rates, reduce rewards, etc.  Ultimately, the consumer would lose, again.  So, as a retailer, in the meantime, the best thing you can do for yourself to reduce your costs, is to become more totally aware of all the costs that you are paying for processing plastic and make certain they are reasonable and appropriate.  I’d be happy to help if you so desire.  Thanks for reading and blessings to you and yours in this upcoming year.

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What’s Your Rate?

Posted on November 17, 2011 by Michael

I’d like to address merchants of all types across this great country of ours.  More specifically, I’d like to talk about your credit card processing.  Likely, you are frequently approached by salespeople of all types that come thru your door or call on the phone.  Are you fed up and pretty much tell everyone of them that cold calls on you that you’re “not interested“?  Honestly, who can blame you…afterall, you’ve got a business to run. 

Unfortunately, in the merchant services (aka credit card processing industry) we’ve got a reputation of being some of the worst.  The industry has the potential to make for a very comfortable living for those that are successful.  Consequently, it attracts a lot of new, inadequately trained “sales types” that give the rest of us professionals a bad reputation.

Let me ask you this question.  When one of these guys/gals walks thru your door, have you asked “what’s your rate”?  Have they quickly responded with a rate that sounds to good to be true?  You know what they say about that, don’t you?

Now, I’d like to share with you how I have responded to that question for years.  Okay, I’m always very conscious of the type of business I’m talking to so I can try to relate to them through what it is they do. For example, you’re a restauranteur and I walk thru your door and introduce myself.  Here’s how the conversation goes:

ME:  Good afternoon, my name is Merchant Services Guy with XYZ Processing Company.  Could I have a minute of your time?

YOU:  I’ve got a business to run and as you can see, I’m quite busy.  What’s your rate?

ME:  That’s nearly impossible for me to answer without knowing more about the types of cards you accept and how you process them.  But first let me ask you a question  if I may.  Do you do catering because I’m looking around.

YOU:  Yes we do, so what can you tell me about this event, such as when, where, how many people and what you want on the menu?

ME:  Well, I can’t tell you when just yet or how many people or even what we want to eat but can you tell me how much it will cost?

YOU:  Well, without more info, I can’t possibly tell you what the cost would be.

ME:  Exactly my point as well!  There’s over 100 different categories that a Visa and a MC can fall into so to simply give you a rate without knowing more about your business and the types of cards you take, I’ll just simply be throwing some arbitrary number at you like the majority of the reps that call on you, simply trying to get your attention.  Just like in your business, you can’t give me a number without knowing more about my needs.  Now, that makes sense, doesn’t it?

You see, it’s not all about “rate”.  Sure, you need to always be concious of your bottom-line and I fully understand that.  But, how many times in the past have you been promised a “great rate” only to find out some time later that it wasn’t all that great? 

More importantly, what you need from our industry is someone that truly wants to work with you to provide not only savings on processing plastic, but solutions as well.  Solutions with possibly some new marketing ideas to help you drive sales.  Have you considered SMS, email or mobile marketing for your business for example?  Any merchant services rep worth their weight in plastic will be able to help you with these areas simply because they recognize the benefit of being a “Solutions Provider” and developing long-term mutually rewarding relationships with you.

Hopefully, this article has brought some enlightment to your day and that you will find it beneficial.  If so, please share it with others.

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Does Your Merchant Services Provider Care?

Posted on November 9, 2011 by Michael

In today’s technologically advanced society, things change rapidly.  Can you remember, for example, the last time you used a pay phone?  It seems like it wasn’t that long ago that when I would begin a new relationship with a merchant, I would have to physically go to their place of business, drag out the paperwork, get signatures and either fax or FedEx the application and additional forms, to the corporate office.

Now, don’t get me wrong, I thoroughly enjoy meeting with merchants and building on long-term mutually rewarding relationships with them.  All I’m saying here is that times are  changing and as a merchant, or merchant services provider for that matter, you really need to stay on top of your game.

With the economy as tight as it is and spendable cash at greatly reduced levels, you really need to do all you can do to stay ahead of the competition.  What are you doing to capture your share, and maybe more, of the available business out there?  How has your business changed or how do you anticipate how you market your business, will change?

For example, let’s take the merchant services provider that handles your credit card processing needs. When you first got started with them, hopefully they spent time with you to thoroughly understand your business and it’s challenges.  Did they simply quote you rates that were “better” than what you were paying or, did they come up with a comprehensive package to not only save you money on processing plastic but also would help you to drive sales? 

Have you taken some time to sit and consider how your business has evolved since you signed up with your current processor. Do you have additional locations, developed a website possibly with a website to expand your market  or are you considering taking advantage of mobile marketing?  Possibly the credit card terminal you’ve been using for years isn’t the best fit for your business any longer.  Would a pin pad be of benefit to you?  How about taking advantage of the rapidly increasing use of NFC (Near Field Communication) technology to speed up checkout.  Are you attending trade shows or does your business have an in-home service or remote aspect to it?  Current mobile payment technology could really help you save on processing costs as well as add a convenience to your customers.  There are numerous Mobile Apps that  are available today so you really need someone that knows what they’re doing to consult with you to help to decide the most appropriate vehicle for you to use.  With these mobile -equipped device and the recommended card reader, your mobile workforce is ready to process signature debit cards as well as Visa®, MasterCard®, Discover® and American Express® wherever and whenever the need arises.

Another thing to consider right now is how you are currently priced with your current provider.  Have they offered you and educated you on the most transparent form of pricing which is Cost-Plus or Interchange-Plus pricing.  If they haven’t, you’ve got to ask yourself why?  I’m sure you can figure that one out.  If you decide to contact me, or another provider for a current evaluation, make certain that if you consider making a switch, make certain that the new provider’s system is compatible with any existing hardware and software (especially if your business has an eCommerce component to it).  Otherwise, any savings you may have gained from a pricing standpoint, could be eaten up in costs to update hardware or software.  Ask the questions!

Let me finish with just a quick heads up.  As I’m sure you’re already aware, undercutting on credit card processing rates is pretty commonplace in this industry.  Unfortunately, many times what “appears” to be a better deal, turns out to not be the case at all.  While keeping your monthly credit card processing fees manageable and within reason is important, what should be of equal concern is the relationship you have with the rep and the company providing the services.  Remember to ask lots of questions and be cognizant of how thoroughly the rep tries to understand your business.  You’ll want to be made aware of and take advantage of all the services available but not be signed up for those that are only an expense and not justified to increase sales for you.  I’m here to help if you have any questions.  Thanks for reading.

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