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CC Processing... Looking To Reduce Costs

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CC Processing... Looking To Reduce Costs

Old 03-05-2014, 02:08 AM
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Default CC Processing... Looking To Reduce Costs

My business is growing and the CC processing fees are mounting. I am using Intuit GoPayment. I have no monthly fees. and have 1.75% swiped rate. Anyone getting lower with another service?

American Express is a killer. They tack on their own fees to the 1.75%. If it's an international card the fees can approach 4%.

For $100,000 in swiped sales I'm looking at about a $3,000 loss in cc fees. For a small business it's substantial.

Stop accepting AMEX? Is that a smart move? Am I going to lose money not accepting it?
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Old 03-05-2014, 03:29 AM
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I don't accept AmEx in my small hvac business. Sometimes people frown as they pull out their MC or Visa. AmEx has to give their cardholders incintives so they put pressure on companies to accept the cards since accepting AmEx is costly to the company.
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Old 03-05-2014, 03:42 AM
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What percentage of your sales are swiped?
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Old 03-05-2014, 03:48 AM
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Raise your prices 5% to cover CC swipes. I would not eliminate Amex.
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Old 03-05-2014, 04:13 AM
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Originally Posted by edale99 View Post
Raise your prices 5% to cover CC swipes. I would not eliminate Amex.
You can't be serious?

We are fighting for less than 5% deals with other dealers, it would price us out of the market.
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Old 03-05-2014, 04:14 AM
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I didn't eliminate Amex all together but I do tell me clients that we PREFER cash, check, Visa, MC in that order. Surprisingly with all my staff doing that Amex has dropped to less than 10% of my swipes. If you are paying 1.75% across the board on Visa/MC/Discover that's pretty good on that volume. IMHO raising prices to compensate isn't really ethical, CC fees are a cost of doing business.
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Old 03-05-2014, 04:17 AM
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Originally Posted by Riptide View Post
... IMHO raising prices to compensate isn't really ethical, CC fees are a cost of doing business.
Huh?

You don't consider your costs when setting prices?
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Old 03-05-2014, 04:32 AM
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Originally Posted by Riptide View Post
I didn't eliminate Amex all together but I do tell me clients that we PREFER cash, check, Visa, MC in that order. Surprisingly with all my staff doing that Amex has dropped to less than 10% of my swipes. If you are paying 1.75% across the board on Visa/MC/Discover that's pretty good on that volume. IMHO raising prices to compensate isn't really ethical, CC fees are a cost of doing business.
So is workmans comp, Insurance, Mortgage, fuel, etc.

That is why gas stations have two (2) prices, cash and CC.
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Old 03-05-2014, 04:49 AM
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1.75% is good

Don't eliminate AMEX but encourage the other cards. AMEX is really only necessary for commercial clients

It is a violation (that is widely ignored) of your merchant agreement to charge a fee for cc use. A different method is to offer a x% discount for cash (if you want to handle cash)

The thing that gripes me the most are the 3% fees for corporate cards and the cards that offer all of the incentives. The vendor pays for all of the rebates, miles, etc.


Get used to it. Consumers hardly use any other payment method. The 1099's that we received from the cc firms in 2013 were staggering
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Old 03-05-2014, 04:59 AM
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I am not sure how much business you do but square is an option. 1.75% you must be putting down some good numbers to get that rate or you pay the 12.95 monthly fee. I used square after i my stores hit over 100k a month i converted to square. they have built in inventory, receipt, and cash flow analysis. It also has a built in cash management system. I pay 250.00 a month, 0 swipe charge for a any card. And i can do up too 250k a month. I have had square for 3 years now works great. I replaced all my registers with IPads. I have bar-scanners attached to each IPad for easy price checks. I am not an apple fan by any means but when its about making money or spending less im all ears.
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Old 03-05-2014, 04:59 AM
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Originally Posted by Crabpot Man View Post
Huh?

You don't consider your costs when setting prices?
Yes of course. When we first opened we took into account EVERY cost and built up from there. And for that matter our CC processing costs are less than half what they were 7 years ago, with the exception of course being Amex.
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Old 03-05-2014, 05:10 AM
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1.75 sounds good. My Chase Paymentech varies, but is around 2.1-2.2. I'll have to look into Intuit.

I don't accept Amex. Very rarely causes an issue. They usually just whip out their MC/Visa/Discover. Every once in a while they'll have to get a check cut... so be it.
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Old 03-05-2014, 05:28 AM
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Look into something called Interchange Plus Pricing. You can thank me later.

Also, Amazon is now starting to get *very* competitive as a processor. That may be something to look into as well.

I've been accepting credit cards for over 25 years and have been playing this game for a long time. Mind you I do *not* swipe (online)... I would *never* (ever) suggest that you get rid of Amex.

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Old 03-05-2014, 05:28 AM
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I see no reason to setup a barrier between me and the customer. I accept them all.

2.02% in 2013 averaged across all cards, all fees.
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Old 03-05-2014, 05:30 AM
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1.75- good, focus on some other way to increase revenue.
the reason international fee is higher is the fraud - ever been to south america? - mega fraud
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Old 03-05-2014, 05:41 AM
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Originally Posted by Parker Yacht View Post
So is workmans comp, Insurance, Mortgage, fuel, etc.

That is why gas stations have two (2) prices, cash and CC.
Not legal in my state.
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Old 03-05-2014, 05:42 AM
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Originally Posted by ThreeLittleFish View Post
My business is growing and the CC processing fees are mounting. I am using Intuit GoPayment. I have no monthly fees. and have 1.75% swiped rate. Anyone getting lower with another service?

American Express is a killer. They tack on their own fees to the 1.75%. If it's an international card the fees can approach 4%.

For $100,000 in swiped sales I'm looking at about a $3,000 loss in cc fees. For a small business it's substantial.

Stop accepting AMEX? Is that a smart move? Am I going to lose money not accepting it?
What % of your sales are CC?

What % of your CC sales are AMEX?

Once you have the analytics, you can then make an informed decision.

1.75% is a good rate.
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Old 03-05-2014, 06:39 AM
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Originally Posted by Parker Yacht View Post
That is why gas stations have two (2) prices, cash and CC.
This is a relatively new practice.
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Old 03-05-2014, 06:45 AM
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Whatever you do, don't take Discover. They are they worst offender of all of them.
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Old 03-05-2014, 06:59 AM
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We tell all of our customers that all prices quoted include a 3% cash discount...often times, the cc processing fees can be the lion's share of the profit in our business.

We have tried everything, for us the problem is the average dollar amount being swiped. We also do a lot of out of state business, non swiped...hold on to your seat.
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