Increase your sales – Accept credit cards

Many people today simply prefer the convenience of paying by credit card. If you want your business, you must be able to accept their credit card payments.
In the first part of this series, we’ll take a look at why you should accept credit cards and the basics of obtaining merchant status. The second part will deal with any objections you may have, which credit cards to accept, and the check payment option.
Obtaining merchant status, which allows you to accept credit card payments, can seem like an unnecessary hassle, especially for those in businesses where most of their customers pay by cash or check. But by not accepting credit card payments, you lose sales. This is especially true if yours is a mail order business or a consulting business. Just look at most businesses today, they all accept credit cards, and debit cards are becoming more and more popular.
As many companies have discovered, up to 70 percent of people never mail their check, so accepting credit cards is crucial. When the customer places an order, he is excited and eager to buy. At the prospect of sending a check, waiting for it to clear, and then waiting for delivery, your interest is likely to wane. Meanwhile, you lose sales.
The Basics of Trader Status
To accept credit cards, you must work with a bank that will transfer the money to your account within a day or two of the sale and then collect the money from the customer. In exchange, he pays the bank a commission of 1.5 to 5 percent for each credit card transaction; a fixed fee per transaction; and an installation fee. You’ll also have to pay monthly support fees or equipment rental for a point-of-sale terminal, the machine used to swipe the card, according to the contract.
The fee is based on two things, the average amount per transaction and the total volume for the year.
When you apply for merchant status, banks assess your business based on your sales history, the type of business it is, your credit history, the credit history of the business, and your overall financial picture.
Apply for merchant status when you get your initial funding. This accomplishes several things. First of all, it shows that you have thought about the future. And you’ll probably have customers you wouldn’t otherwise have. In fact, some people don’t pay with anything other than credit cards.
Second, it shows that you are taking steps to minimize the time and expense of recovering bad debts. If someone writes a bad check, for example, it will cost you time and money to recover the loss. If you swipe a customer’s credit card through a point of sale terminal, you can be sure they will pay you. The machine communicates with the issuing bank to authorize the transaction and runs the account numbers through a variety of fraud protection procedures.
In part two of this series, we’ll cover objections you may have, which credit cards to accept, and the check payment option.
Copyright 2004 DeFiore Companies

Leave a Reply

Your email address will not be published. Required fields are marked *