More Junk Fees

They just keep coming.  A new junk fee I recently came across.  I am often asked what is your rate? It’s not about one rate, one needs to look at the sum of the total. Here is another example about another “junk fee”. Monthly Funding Advantage is a made up fee. Also I am seeing a new junk fee called “EMV non-enabled Fee” at a rate of 3 basis points. This fee will hit restaurants that does not have a POS to accept Chip Cards.

Give us a call to find out how we can help you eliminate junk fees. 727-916-7294

Omnichannel retail - What is it and Why?

Customers want more than most retailers are able to offer. Modern consumers want to buy online, but pick up or return at the store. They want to browse product information on their laptop or smartphone, get coupons or discount codes, even make a purchase on their mobile phone while in a store. New consumers are naturally combining channels as they browse, research and buy.

With 90% of consumers researching products online before they buy and 25% of shoppers buying online after they’ve experienced and touched the items in-store, the path to purchase is no longer a straight line. Today’s tech savvy consumer demands flexibility from retailers as they drift from in-store to mobile to online and back again. The age of the brick-and-click is here and retailers need to catch this wave or get washed away as more and more of their competitors adopt the agile omnichannel model of retail.

In an omnichannel world, retailers can combine data from every transaction and interaction, from any channel, into a unique individual file for each customer. Customer records can include previous in-store and online purchases, deliveries made, coupons used, gift cards purchased, comments on social media, phone interactions – anything and everything that can be used to gain deeper insight into customer behavior patterns.

With a better understanding of their customers, retailers will benefit from higher customer satisfaction, which will ultimately result in more sales and brand loyalty. Being open for business 24 hours per day, 7 days per week, frees customers once bound by the dated constraints of store hours. This gives them added opportunities to interact with your brand on their own time and allows you to literally ring up sales while you sleep.

We have an affordable solution for retailers which give the best of both worlds. An integrated system means that retailers will be able to streamline their operations, saving time and effort with joint reporting, a unified inventory, and centralized sales information.

Give us a call to find out how we can help you.  727-916-7294

What Makes A Business / Merchant “HIGH RISK”?

High risk has to do more with the charge back exposure, since the acquiring / sponsoring bank is responsible for all charge backs if a business were to cease business and close for any reason.  A better way to characterize a business as high risk is harder to place

Why then is a business “harder to place” for taking credit cards?  This is because an acquiring / sponsoring bank will not even consider or approve a business based on various details that are not in line with their underwriting guidelines.  Most of the time it about the financial expose and loss. As an underwriter they look at worst case scenarios in regards to financial expose and loss.  For example, if a business had their processing account stop abruptly, this will have a serious consequence to their cash flow, which might affect delivery of product or service on payments taken previously.  This in turn causes customers to dispute credit card transactions when the product or service is delayed and everything for the business spiral out of control. 

Let’s examine travel agents.  There are several factors that make this type of business “high risk or hard to place”.  The vast majority of travel agents are good people who run legitimate sales through their business, but the problem lies with what is outside of their control.  They can do an excellence job booking a vacation well below market price, but a last minute deals from hotel or an airlines that significantly drop their rates the week before the vacation starts due to a surplus of rooms / seats.  In this example the customer books this last minute deal and goes to the issuing bank and disputes the original credit card charge and will likely win the dispute.  Also consider the travel agent has no control over how their vendor operates and if the customer has a bad experience for any number of reasons they are likely to get buyer’s remorse and dispute the charges. 

Another example is electronic cigarette most acquiring / sponsoring bank will reject this type of business type on principle alone citing it is too easy for a minor to purchase the product online.  It’s the potential of taking part in facilitating the sale of nicotine products to minors that the acquiring / sponsoring bank is avoiding due to nothing in regards to financial expose and loss.

Banks having been doing this a lot longer than you have been in business and have enough experience and history to know that even a good business can go bad.  They look at the long term, “how much do we stand to lose if this company closes its doors tomorrow?” Acquiring / sponsoring bank are typically on the hook for charge backs for six months after the delivery of a product or service. We hope this might help to give you a better understanding into this subject.

If your business is "high risk" or not, we can help.  Contact us at 888-506-9225 or info@tampabaymerchantservices.com

Dirty Little Secret Of Equipment Leasing – Part Three

To add to this subject and mention new information, a law suit was filed recently by the Attorney General of New York.  Read more on the link provide below. The company involved is Northern Leasing Systems.  This is just one company involved in this “leasing” industry.  In the complaint it mentioned deceptive sales practices, which I have heard about from business owners.  In additional it states, “Northern Leasing’s lease terms are onerous and totally one-sided in favor of the company.  The credit card equipment leased to consumers by Northern Leasing is valued at only a few hundred dollars (at most) when new, yet over the course of a Northern Leasing lease consumers pay thousands of dollars for the equipment." This echoes info in my previous post where I mentioned the cost.  Again, do not lease your credit card terminals or equipment.  It is just not a good business decision. 

http://www.ag.ny.gov/press-release/ag-schneiderman-sues-northern-leasing-systems-inc-deceptive-business-practices-and

 If you have any question about this, please feel free to contact us at  info@tampabaymerchantservices.com or call 727-916-7294

Don’t Get “Squared” by Square Up

I am noticing more and more merchant using Square for processing their credit cards.  On the surface Square may seem like a good option and for some it maybe.  If you are just starting out and not sure how well your new business my take off and depending on what you are selling or services of your new business, perhaps it is a good option. For example, right now it is more of a hobby that a thriving business.  Square might be a good option. 

However consider the down side of Square.  In many cases the cost for processing credit cards can be higher with Square.  Because Square is an aggregator you have no true merchant account.  They refer to their customers as sellers.  When one opens an account, they take much of what one presents with little vetting or underwriting.  If they question later what you do or sell or how you sell it, all then without warning your money will be withheld.  Then the fun begins with getting help or having a conversation with a person.  Consider other service related issues.  See the example below:

By the way Square is losing money, Net Loss of $48 million - per page 13 4q 2015 letter to investors

If you want to have first class customer service, in most cases less cost than what Square, call us 727-916-7294

Is There Any Benefit Obtaining Your Merchant Processing Account Thru an Association?

The short answer is not always.  It dependents on how much the Acquire charges or not charges.  What is an Acquirer?  Read our earlier post on this subject. at the following link.  This is not to say other benefits from the “Association” are not good, I am only addressing the credit card processing.  I have talked to several businesses that belong to the “Association” and one of the many so called benefits is the lower cost of processing.  Many of these same merchants are very closed minded about considering another alternative.  The few I did get to see had good rates, but not as low as we offer.  Do yourself a favor, let us look at your processing statement and we will analysis it to let you know just how good of a deal you are receiving from your “Association”.  I am sure you will be glad you did.

If you have any question about this, please feel free to contact us at  info@tampabaymerchantservices.com or call 727-916-7294

Dirty Little Secret Of Equipment Leasing – Part Two $10,000 for a credit card terminal!

I have written about the many different ways the banks or Processing Companies can rip your business off taking hard earned money out of your pocket.  One of the worse in my opinion is leasing of credit card terminals.  When you lease a credit card terminal you are paying about four times of what it would cost you to buy the terminal out right.  Read more in my original post  at Dirty Little Secret Of Equipment Leasing

I bring this subject up again because a merchant I was dealing recently recently discovered a lease payment coming out of his bank account when he went to change his bank account.  As it turns out it was for from a lease that was started more than 10 years ago.  He was paying around $90 per month. That is around $10,000 for a credit card terminal!  Not sure why the business owner did not catch this before.  Or his accountant and / or bookkeeper did not notice or discover this payment all these years when they worked with his taxes and bank account?

Another situation for another business I came across, the merchant has one lease account / payment started two years ago, then a “new” rep came into the business around a year ago and added another lease account.  Why? Good question, the rep left the industry so we cannot ask her.  Keep in mind these two leases are with the same leasing company.  I was helping the merchant sort this out and was on the phone with the leasing company and I asked them the question, why did they let her have two leasing?  Did they do any due diligence?  Well let’s say they had no real answer to the question.

Again, to you a business owner, DO NOT LEASE.  READ BEFORE YOU SIGN! ASK QUESTIONS. KNOW WHO YOU ARE DEALING WITH.

 If you have any question about this, please feel free to contact us at  info@tampabaymerchantservices.com or call 727-916-7294