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As a new operator, I am interested how other operators recover some of the various fees from credit card use. My Feb statement(Total Merchant/Global Pay) had $47 deducted from my bank for running one card through the system for $257 job. 18% for customer convenience is tough to swallow if loads of additional biz isn’t generated. Any suggestions?
Thanks,
Ward WallnerI’d be happy to help you with your question if you would let me know which credit card it was (visa, master card, a.ex, ect…) we use Total Merchants Services also and I belive that the cards “do” vary in rates, I’d be happy to pull my receipts and do some math for you. I seem to think that visa and m.c. is 1.79 but other fees apply also, let me know.
SteveSteve,
I understand the breakdown of how they reached the total for the month. What I was looking for was if you somehow add a fee to your jobs or something that would help offset the % fees, transaction fees, wireless fee, statement fee and the basic monthly fee.
Ward
Ward,
I think you have two options:1. Eat the cost and let it average itself out over the revenue from all of your customers.
2. Add a specific fee, such as 3 – 5% for anyone who uses their credit card. If you go with this type of an add-on fee, you need to be careful with your wording in any ads.
I can tell you that your customers will balk at an add-on fee of 18%.
I’m guessing some of your cost was a fixed once-per-month fee from the supplier of your machine for the month and that some of it was a direct percentage of that one charge. If I’m correct, that fixed fee will diminish in significance as your business grows and you end up with more credit card charges for a month.
If my assumption is correct, how much is the actual percentage for each transaction?
If my assumption is incorrect, you need to find another service provider immediately. You can’t tolerate a cost of 18% per charge. Are you under a contract for your machine?
Also, you may want to check around for a better deal anyway. Some merchant service providers don’t have a monthly fee of any sort. They just collect their small slice off of each transaction. If you don’t eventually have a fair number of charges each month, a monthly fee just for having the machine will start to annoy you.
I believe there was a mention of this in our March newsletter from Rexburg Corporate with a link to a good deal.
This subject has come up on this forum previously. You might search for some older threads. Some operators have mentioned who they get their merchant services from and they had very low costs.
Good luck!
Mike
I just wanted to make mention about adding the additional fee for people paying with credit cards…This is an idea I had way back when, after some reasearch I found out it was against the law, at least in Idaho. If you want to have a 3-5% increase for those who pay with credit card, you need to increase your fee 3-5% for all customers. Just an FYI, I don’t know if that goes beyond the state level, but I would look into before implementing the idea!
It is also against the law in Washington and California to charge people for using their credit cards. If you want to accept credit cards you will just have to pay the fee. I know of other business owners that have increased their prices overall and give a cash discount when payment is received in cash.
I know that no one will believe this, but in the past 3 1/2 years, we have accepted the grand total of, I believe, 6-7 credit cards. Lancaster County, PA is very, very conservative…cash or check. And yes, I had 4 of them bounce and all four were made good within a week.
Finding a merchant services supplier for us was surprising…our bank…high fees, other suppliers fees plus percentages plus, plus… We just do not do enough volume in $$$/month in plastic to really pay. So, who won our comparisons..PayPal.
Who hasn’t heard of them or used them…almost all of the free world, or almost anyone who uses EBay. They are not fly by night as some of the companies may be, have a straight up reputation, take any and all cards and will credit bank account now…I think. Never had a problem with them in the past with my personal account.
3.5% + $0.30 per transaction + $20/month fee.
Simple, a little pricey, but simple and easy to set up, with no machine except a computer and run through same as with home office, but somewhat cheaper.
Hope this helps and if someone has a better plan, please let us know…
Dave Dilts
And, as a customer I would be offended by an add-on fee. If someone accepts cards, it is fair to assume they also can afford to accept them! I quit doing business with our local pizza hut for a long time because they started charging an additional 50 cents for the right to pay by check! It made me mad – it’s either accept or don’t accept. I already give out DL #’s, DOB, etc. so don’t penalize me for a few of your returned checks. As a businessman, just think how many pizzas I bought elsewhere – all over 50 cents!
hi daveinpa
3.5%+.030 per transaction+20mounth is very high
we pay 1.79% +.025 per transaction and 20 a mounth for wireless terminal. it is nice to have the terminal on the job. you can cali total merchant services (kevin kennedy) 1-800-539-2141 to get setupHi Guys,
Thanks for all the responses. FYI, I am with Total Merchant and have no issues with the % fees, wireless fees($15), transaction fees, or the equiptment, but the $5 statement fee is an add-on for them. I have asked about an online statement which is available but they will still charge me $5 for my paper statement. I had discussed this with Kevin who had no sysmpathy for the contractors-why would he, it is out of his pocket!! Anyway, after reading your responses, I am absorbing the charges for a while and see how much volume it brings on over the spring/summer timeframe.
Warddaveinpa,
Oh, I forgot to mention, Total Merchant Services charges a $12.95/month if you want to access information via the internet. They offer a two month free trial, but you have to call and cancel it after two months if you don’t want to use it. I forgot to call and cancel and I called them and they refunded the charges without questions.
If you have any questions give me a call at 360-394-5326.
Dan
Called Kevin today…thanks for the suggestion.
It is however too expensive for me. We run 2 vans and need 2 machines…then there is the report, and the $20…real quick went over $50/month with no charges. For someone who runs a lot of dollars, it makes sense, but not for someone like us that have gotten only 7 or so charges in 3 1/2 years….It would take some real charges to overcome the 1.8% difference in charges and other related costs.
Thanks to all for the info.
In Iowa, I have seen numerous gas stations offer a discount for cash customers. I cannot remember seeing this in practice anywhere else or with any other business. The discount is usually extended to checks also. Gets around the transaction fees.
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