I often hear from CFO’s that more credit card processing companies call on them than any other vendor. So with over 100-1000 calls per year, how do merchants sort through it all and choose your blog host? Tenacity is often cited, but that’s only part of the equation. My keys:

1. Education on pricing- I educate customers on the 4 core elements including which costs are negotiable, which are not, which can be influenced, and which ones may vary by vendor (some may have higher fixed costs than others).
2. Reporting- You must have completely transparent reports in order to identify the costs above, as well as to manage them. I show you what a transparent report looks like and help you understand it. How do you use data for reconciliation?
3. Interchange management. Once you have the right pricing and detailed reports, it’s time to attack interchange qualification. Most of your money, over 95% is paid in interchange fees. Many merchants think the processor gets the money, but that’s not the case. Ensuring you hit the lowest interchange for any given card presented is the next step.
This can be achieved through many different methods, and will never be completely transparent to the merchant because you simply cannot see everything that goes into why a transaction qualifies. With good reporting, you CAN find out why a transaction downgraded. But of course, you’d also have to know WHICH transactions downgraded and WHY in order to fix it. An expert is really needed for this step. Someone who will ‘watch your back’. That’s where I come in. I’ll do most of this behind the scenes and we’ll also have Webex conferences to review your account, including a statement review.
4. Continuing Education- Let’s face it we’re all busy people and sometimes don’t have time to get to anything new unless it’s forced upon us. I’m your force. If something must be done, like PCI Compliance, you’ll hear from me. If there’s new technology (from any vendor) you can implement that will make your job easier, I’ll call you. I’ll advise you of pros and cons, risks and rewards, and quantify it whenever possible so you can focus on what you do best.

* (If you were not aware of the above before, would you go back to your old processor and renegotiate, or would you say, they’ve earned the right to have my business? If you intend to go back to your processor don’t disappear, thank me by paying me a fee to help you renegotiate your contract.)

Cost reduction specialists choose 3D Merchant Services to partner with for credit card processing because we offer value added services just like they do.  Cost reduction specialists look for ways to reduce credit card processing costs and frequently are paid on a contingency basis. Merchants don’t switch processors just to save money though. They need a bigger reason than that.

Merchants hear from sales people every day “I can lower your costs.”  While some cost reductions are achieved with merchant discount changes, most long term savings are achieved through interchange management. There’s also improved efficiencies (save time) which can be huge. If the cost reduction specialist uses just the  ’save money’ approach, they’ll lose more deals than ’save money AND get more benefits’.

Our competitive advantage:

• PCI Compliance Certification Assistance.
• Fortune 100 Pricing Structure.
• Relationship Manager proactively helps you manage costs; regular account reviews.
• On demand access to transaction details and reports you really want.
• Tools and resources to prevent internal and external fraud.
• Hardware/software agnostic- compatible with most systems.

Our Top 5 vertical markets: ( not in order)

• Retail, especially durable goods, automotive, construction supplies and electronics.
• Non-profit
• Wholesale building supply; any Business to Business (B2B)
• Hotel and entertainment (golf, amusement)
• Ecommerce

Market niche comments:

• Card not present transactions have many potential cost and risk problems. We’re seeking B2B, insurance, medical billing and non-profits in particular.
• For retail stores processing more than $1 million per month, our CenPOS technology solution is frequently desirable and has benefits not available from other competitors.
• Our average merchant is processing a minimum of $1 million annually.

Service reliability- I hope that this is a non-issue in any organization. Downtime is non-existent in my experience.

Another worry for merchants is the process of changing.  We address this upfront with an implementation schedule. Both parties need to have all elements or questions answered completely before we start to ensure a smooth and flawless transition.

For the Cost Reduction Specialist to prove savings, and thus get paid, you’ll need reporting that shows not only costs, but the full detail of all costs. Merchant reports show full details so that you can discern non-negotiable cost increases (such as an interchange rate increase) that are out of anyone’s control.

Our services are not limited to just credit card processing. We offer services for all aspects of payment processing, including checks, loyalty cards and more.

We conduct account reviews, training, and other conference calls using Webex, a web based meeting program that allows us to exchange voice, data, pictures and video in real time with customers, and you, regardless of location.

Volusion references the standard fees for merchant accounts as Discount rate, Transaction fee, and Statement fee. Then additional fees you can avoid if you use Volusion which include the application fee, set-up fee, and customer support.

For the small business, all of the above is true. Most ecommerce businesses are offered rates that fit the above description. But what if you are processing hundreds of thousands or millions annually? If you are paying the above fees and nothing else, then actual costs are being averaged with a healthy profit built in.

How do I know this? Because EVERYONE PAYS INTERCHANGE. It doesn’t matter if you get your account from a bank, an independent service provider, or your local wholesale buyers club.  Interchange varies with hundreds of different rules creating hundreds of different rates, but in essence interchange for ecommerce includes a percentage rate and a per transaction fee. Then there are other fees such as the cross border fee, Visa misuse of authorization, authorization ( frequently bundled), MasterCard Brand Usage fee, and yes, the merchant discount.

If you are paying one fee, or a few fees, then your processor has estimated what their actual costs will be based on certain historical trends, then mark it up and charge you that.  The processor WILL ALWAYS estimate a healty profit to make sure they don’t lose money, because THEY PAY INTERCHANGE and associated costs, not bundled pricing. In summary, bundled fees equals higher costs and fees that are broken out into minute detail have the potential * to be the lowest cost.

Why the POTENTIAL and not the actual lowest cost? The same card could go through at 2.2% OR 2.95%. This is for another discussion. Basically, you need to see what interchange levels you hit so that you can MANAGE interchange qualification. Yes, you can manage costs. Well, probably not you, but with an expert service like what we provide, you’ll hit a lot more at 2.2% vs 2.95%. And we’ll get you wholesale prices instead of bundled rate packages.

Compare your Gateway and processor with one company vs two companies. After the initial account set up it’s virtually unheard of to have any problems with either the gateway or the processor if you are using quality companies. Volusion isn’t in the payment processing business. They outsource and get a referral fee. I believe you should pick the best gateway to achieve specific needs and the same for the processor. For example, do you need a virtual terminal? How important is online reporting for reconciliation? I think this is really a non-issue and I’m personally indifferent as to the benefits of using one or two companies. You should be too.

What is the application process like? Why is it faster with some processors vs others? It’s not because the application is vastly different, it’s almost always the quality of pricing and services you are hoping to get. I can place you with one merchant processor and have it approved in days but another might take a week or two. The longer process is for a provider that does a more thorough underwriting review and requires additional documentation beyond the basics. The benefits are numerous including ‘best in world’ online reporting and true wholesale pricing.

In conclusion, the overall Volusion merchant accounts 101 is a great starter review. However, unless you are a very small business, you can do better with pricing and other benefits without sacrificing service and quality.  I like the Volusion shopping cart and their service and I recommend them. Like all shopping carts though, you really need a thorough understanding of what you need to accomplish on both the front and back end to determine the best solution for you. That’s why there are so many carts out there- because people have different needs.