Every processor out there has the same base cost for any given credit card transaction. This cost is known as interchange. Processors make money to pay their bills and turn a profit by marking up this cost and passing it along to its merchants. How much your rates are marked up can vary greatly, and there are a lot of factors that can go into how much of a markup you’re paying.

This is a bit of an over simplistic view of it, and it assumes that all processors are created equal. While they all do in fact have the same, Visa and MasterCard mandated costs when it comes to the processing of a transaction, but there is something else to it. They will all need to cover their costs on each individual transaction, but they will also have to mark up interchange more or less depending on how much other overhead they have. Therefore, the processor who is able to run its operation most efficiently is likely going to be able to offer you better rates.

So what can you do to make sure that your credit card processor is up there with some of the most efficient processors around? Unfortunately, at the business owner level, there is not a whole lot that you can do. Many processors are privately held, so they have no obligation to provide audited financial statements to the SEC. All you can really do is to take a look at your own credit card processing rates and do your best to figure out if they’re marked up too much.

How Much is Too Much

That begs the next question, or questions. First, how can you tell how much your transactions are marked up, and secondly, how much is too much? Certainly, it is going to vary depending on your situation. One thing I can tell you is that the Card Associations, (Visa, MasterCard and Discover), who are the ones that dictate what interchange actually is, they disclose the current interchange tables on their websites. You can take a look and try to figure it out, but it really is very complicated. Your next best bet is to give us a call here at Sure Payment Solutions. We’ll be able to take a look at your most recent processing statement and let you know if you’re paying too much. If so, we’ll show you exactly which line items we think are too high, and we’ll even let you know what you would pay if you were to process with us. It’s fast and easy, and there are never any obligations or costs associated with this.

You probably get calls all the time from people trying to get you to switch over your credit card processing. You hear all the promises about all the thousands and thousands of dollars that you will save. You may even have taken someone up on one of these offers only to find a few months later that your rates really aren’t any different. Sure, they may have lowered you “qualified rate” but they may have raised your rate in another line item just to make up the difference so you are left paying just about the same amount that you previously were.

How to Save Money on your Credit Card Processing

If you have tried to do this a few times already but without any luck, it does not mean that you are doomed to paying the same high discount rate or transaction fee for the rest of your days. You just need to find a reputable company out there who is willing to do the legwork and actually PROVE to you that you will end up saving money by switching over your merchant account.

So how can you tell if you’re dealing with a company like that? The first thing that you want to do is to ask your representative for a detailed rate analysis. Don’t accept just a plain text email saying something like, “You’re paying 1.7%, and we’ll lower it to 1.6%.” That’s totally bogus. There is so much more to it than that, that if you’re representative thinks that he or she can actually break it down for you this way, he or she probably has no idea how it all works.

The truth is that there can literally be hundreds of different line items that go into how much you end up paying at the end of the month. You want to work with someone who is willing to address each of the applicable line items and show you line by line, exactly how much you are paying now, and what they are proposing to lower it to. Keep in mind that they may not actually lower every single line item, but the proposed rates may still show you savings at the end of the day. For example, if you are paying 1.5% and $0.25 per transaction, but you run a lot of transactions each month, it may make sense to pay 1.59% and $0.18 per transaction. Even though they proposed RAISING your discount rate, the overall savings on the $0.07 that your transaction fee would be lowered would more than make up the difference.

You may ask, why would someone do that? Why would they opening admit that they are raising a certain line item from your previous credit card processing rates? The answer to that question is more than likely that the person you are working with is an honest person and wants to be totally transparent. They are willing to walk you through and take the time to explain how everything works, and they would rather propose a fair rate structure rather than making you think that you are paying 0.05% but then charging you $10.00 per transaction (slight exaggeration there, but you get the picture).

Call Sure Payment Solutions

Call us here to find out exactly how much money you can save. On average, our customers save $40-$50 every single month by utilizing our services compared to their current credit card processing rates. That adds up, believe me. So give us a call and we’ll give you a free consultation and a full rate comparison, and we’ll make sure you have all the information you need to make an informed decision.

From an accounting perspective, there is a lot of confusion as to how your merchant cash advance ends up on the books. It’s tempting to book it as a balance sheet item, but you have to remember that the merchant cash advance is not a loan. The next obvious step would be to try to break out each payment that you made into principal and interest. The problem with this method is that when you take a merchant cash advance, you’re not actually borrowing money, and therefore you aren’t taking on any debt. So how does this work, where does your merchant cash advance end up on your financials?

What is a Merchant Cash Advance?

It is important to remember that a merchant cash advance is actually a purchase and sale agreement. If you read through any merchant cash advance contract, most of the time it is very clear that you are selling a fixed amount of your future revenue from credit card processing transactions. With this in mind, the logical thing to do from an accounting standpoint would be to book the entire purchase price (the advance amount) as income once you receive the deposit into your bank account. Since from that point forward, you should be repaying the advance through fixed percentage of your credit card processing sales. What should happen over time, therefore, is that the income you are able to show from your credit card processing activity should be reduced by the amount of receivables you have sold (the total amount you repay). In that way you’d actually be reducing your taxable income, which may be another benefit of the program that many people are not aware of.

Of course, it is wise to consult with your accountant before making any decisions of this sort, but the point of this post is that your merchant cash advance should probably not be booked as debt, with interest payments as expenses to be found on your profit and loss statement.

How Much Could you Save?

If you have an existing merchant cash advance and would like a quote from one of our agents, it’s easy to fill out a “Get Started” form at the top of this page, or you can just give us a call to see how much you would qualify for and how much money you could save with us.

Restaurant POS Systems

For decades, people who owned a retail business considered the cash register to be their essential point of sale (POS device). Today, technology is part of the retail industry, and business owners can use a low cost restaurant POS system that best suits their particular needs.

Wireless hand-held device

This popular piece of restaurant equipment is used to serve customers more quickly and accurately than ever before. Waiters can use it to offer daily specials to their customers, complete credit card transactions or send a message to the chef. It also enables them to spend more time communicating with their customers, seeing that their needs are met, and impressing them with their outstanding customer service.

“Sticky” paper printer

The kind of paper this device uses resembles a Post-It, and the user can move the paper to various locations repeatedly. The paper can also be printed at the desired length, and it will stick to virtually any surface as well. With this type of printer, the paper can be kept with the order until the process is complete. It is totally recyclable, and it can be used for any type of order or to create bag tags.

Digital menu board

With the use of audio, video and pictures, this low cost restaurant POS system can be used to transmit media-rich content. These packages contain digital menu-board software, which is both seamless and fully integrated, to develop content with the use of one database. Menu items, prices, pages and titles can be intertwined with advanced multimedia, giving the menu board an interactive, dramatic display operating on one system.

Self-service or interactive kiosk

Those who adopted this device combined it with other technological advances, including the touch-screen monitor. In reality, it is self-service software added to self-service hardware, and it can be used to accelerate the ordering process while reducing labor costs. In addition, many of the POS packages also use motion graphics and sound to enhance the customer’s dining experience.

Paging cell phones

Certain restaurants take a different approach and page customers’ cell phones by asking for the visitor’s cell phone number and listing in their cell-phone paging device. When that customer’s table is ready, the pager delivers an automated cell-phone message to inform the customer that he or she can see the host or hostess and be seated. Guests seem to appreciate the convenience the system offers, and there is never any concern that the customer might walk away with someone’s pager.

In this day and age, it shouldn’t be hard to come up with a few good reasons to start accepting credit cards from your customers. First of all, more and more consumers are opting to pay with plastic rather than the old fashioned way of paying with cash. This is largely because of the increase in cardholder rewards programs. For example, many Visa, MasterCard, Discover and American Express cards offer travel rewards or cash back. This is a bummer for all the cash cows out there, but there are many benefits to getting set up to process credit cards.

First of all, you’ll stop losing customers to people who are going next door or across the street to a place where they can pay with plastic. Even if you run just a handful of extra transactions each month, the extra revenue should more than pay for the fees you’ll incur from processing cards.

Secondly, people tend to spend more money when they’re paying with plastic. I don’t think it would be unreasonable to see your credit card customers spend at least 5% more than they would as a cash transaction. This is largely psychological. Getting someone to swipe a plastic card is way easier than parting them with the precious cash in their wallet. Sounds silly doesn’t it?

Adding credit card processing to your business will allow you to expand into the world of e-commerce. If you’re willing to spend a little bit of time and money building a great website, you can add a whole new stream of revenue to your business with very little overhead.

It’s so easy to set up, just give us a call and you can talk to an account representative today about what kind of rates you’d enjoy, and how quickly you can get set up.