Small business credit card setup?? HOW

[Alex Clark]

I have been taking checks, money orders and cash for the last few years.
But now that we are adding the guest cabin to the business, I think I may be shooting myself in the foot if I do not have a way to take credit cards too.

BUT, the banks want a BUNCH of money for the credit card machine and all the stuff that goes with it.

Any ideas??? Who knows I may not have much business other than cash or check for the next couple of years. So I can't see putting a huge amount of money into some credit card equipment that only makes the bank richer...


xx

 

[zane]

Alex,

Be VERY careful when shopping for credit card processing services. My dad enrolled with a company called Card Payment Solutions that he found online, and faxed them the necessary documents, acct numbers, etc for making deposits into his business acct. All this before he consulted me(I'm a web developer and e-commerce integrator.) I recommended that he go with a friend of mine who run a processing company. I trust the guy, which is important in this day and age of faceless transactions. He set us up with a good deal, virtual terminal, and competitive rate.

Meanwhile, Card Payment Solutions was contacting us demanding that we take our photo gallery down from our business website because it had personal photos in it. Well, our site wasn't live yet, and I agree that personal photos(of a backpacking trip if you're curious) aren't professional, but HEY IT'S OUR SITE AND NO ONE WILL TELL US WHAT TO DO WITH IT.

CPS wouldn't render any services until we did this, and anyway we were going to drop them and go with my friend. My dad made several calls to them with none returned and no answer. When he finally did get a hold of someone, they 1)refused to provide processing service until we changed our site, 2) refused to cancel our "service", and 3) threatened to file a collection claim against us. 3 weeks later, they deducted $900 from his business acct unannounced, claiming that since we were withdrawing from our service contract, we owed them service fees for 3 years. Well, they never rendered any services, and considering the above, we were at an impasse. We had our acct numbers changed, and our bank went to bat for us, but it was too late. Companies like CPS are crooks, watch your ass, this industry is full of them. These guys NEVER performed any services for us, and stole $900.

We've been doing business with my friend's company for several months and are happy. Going with your bank is safe, but can sometimes be more expensive. Giving access to your bank acct should be considered on par with letting someone give you a prostate exam. It's delicate and serious!

I'm sure Steve or other small business owners have something to contribute.

Zane

 

[teeweed]

My wife and I had an antique shop that we ran on the side. We had the business for I think three years. Some guy came in the shop and talked my wife into a fancy credit card machine, the one we had was fine, it was the old fashion type where you had to drag the machine over the card. No power, no printer. This new one was faster, you just swiped the card and the printer thing would print. PROBLEM WAS THE HIDDEN CONTRACT We are just now finishing up the contract on this, and we have not had the bussiness for over two years. WATCH OUT This was a costly mistake. We have the obsolite machine boxed up and ready to send back...because if you don't there will be high fees to pay. Mark

 

[sj]

Alex,

We have had lots of merchant accounts over the years. We finally got down to just one now.

You no longer have to have a machine, you can do all the processing on-line. We do it with "Quickbooks", but other accounting systems and credit card gateways like Authorize.Net will let you do it on-line also.

It is (usually a percent or two) cheaper if you get a card reader for your computer and actually swipe the card - which of course you can't do if you are interested in on-line ordering. We don't swipe cards, we use quickbooks to either enter the card info ourselves, or send an electronic invoice to our members. It is pretty handy, but we will be migrating out of Quickbooks for unrelated reasons soon.

You can go to your bank and they can set you up with a merchant account, we had one via Bank of America, which was fine. There is always a setup fee, and Zane is right, they do often want to verify your site. Even BofA did a very similar thing to what Zane is saying - and the website had to have the exact name of our corporation on it in order for them to allow us to accept credit cards on it.

One thing: If you have a lot of transactions, the statements can be very confusing - they look like investment portfolio statements.

Although some people don't like it, you can also use PayPal to take credit cards.

Somebody told me the other day, "You have to spend money to save money"...

sj

 

[Hyrdflyr]

credit cards

You don't save money with credit card transactions in a small business.

All you can hope for is to keep it simple and lose as little as possible.

I went through a bunch of possibilities for a small business I have and finally just went with PayPal, and yes, I get tons of Phish mail but just ignore it all.

It costs me the least, with the least hassle, and if somebody shows up at my door and wants to use a credit card I just run them past the nearest ATM and take their cash.

Keep it simple. don't spend $50 a month or more for years in order to take one or two transactions a month.

 

[sj]

Re: credit cards

You don't save money with credit card transactions in a small business.

You are correct, you have to have the volume to cover the costs, or increase the costs accordingly. What you are doing is giving folks an easy way to give you money, which is a must in what we do, and also pretty important for flight training - if somebody is going to spend a bunch.

sj

 

[Steve's Aircraft (Brian)]

We use a Merchant Account with Quickbooks for all of our electronic transactions. We had to figure something out when we started making our Gascolators and Quickbooks wound up being the easiest to set up and maintain. Cost us something like $15.00 a month plus a percentage of each sale.

What I don't understand is why the banks give you guys a hard time with your websites. Our merchant account has never even asked about our website. Of course we use our site primarily for advertising and some sales but we do not take credit cards through our site. We specify that the customer call us with their credit card information. Negates having to pay for a secure web site also.

Brian

 

[sj]

Brian,

It is when people take credit cards through the site that they ask. BofA said they had a lot of complaints of one company name showing up on the website, and another name on the credit card charge.

sj

 

[Bill Ingerson]

credit card machine

Alex, Unless you have a very high volume its not worth it. We have a company that sells Boilers and repairs them. We do some bassness with the Coast Guard, Navy and other government bassnesses. All of them want us to use Credit card transactions. Its nice because you get your money right away, while loosing a good portion of it ?
We signed a two year lease through our bank, got the machine, and decided afterwards, we just don't do enough credit card transactions to pay for itself. So we just invoice our customers and wait to get paid.
The machine has never been used, still in the box and we pay $36.89 a month for it, more if we use it. The bank told us that the machine is of no use to them, even though it has not been taken out of the box and they would not buy it back.
This machine could end up on E-bay or 1/2 price to cubbers.

Bill

 

[behindpropellers]

Alex-

In regard to the fees....

Why not just raise your prices 5% and give a 5% discount for cash or money order? I would think most people would pick to just pay cash then. You may want to look into using paypal, I think it costs an extra 2-5% to use it, and best of all, no monthly fee.

Tim

 

[Alex Clark]

There is a gal who has a fishing charter business here and they do something with credit cards thru Sams Club.

How much do you loose doing it with Pay Pal?
Are they as controlling??

I guess with people doing cabin or flight reservations over the phone that might work...

I have a LOT of no shows. I pre-flight, fuel and sit on the lake and the just never show up. They might call several days or weeks later and say that they were on their way and suddenly went fishing instead.

Then they call to reschedule on a rainy, windy day. Their reasoning,,,,"Well it was really sunny so it looked like better fishing weather." The locals are the worst. They never make it to an appointment.


xx

 

[behindpropellers]

Alex-

Looks like about 3% plus $.30.

https://www.paypal.com/cgi-bin/webscr?cmd=_display-receiving-fees-outside

They are not controlling, you just have a link with the price on your website that directs them to pay the specified amount .

https://www.paypal.com/cgi-bin/webscr?cmd=_merchant-outside

Tim

 

[cubflier]

Alex

I pay 1.6% plus .25 at http://www.merchante-solutions.com. I can negotiate my own rate but as I recall they offer an entry rate of around 1.67% Local banks will kill you on the rate. Costco offers services through Nova in the range of 1.57% but they are difficult to deal with as far as sign up and take to much approval time, as in 3 weeks. If you can stomach the folks at Nova they are the best deal. Keep in mind these rates are for brick and mortar operations as contrasted to internet services. We had an internet account at merchante and it was around 2.7% or so. You'll always pay more for internet fees. The problem with brick and mortar account is you need to buy or rent equipment. We have two Omni 3200 at around $800.00 each. Prices on equipment varies and hopefully it's gone down.

We found that people spend more if you take credit card so the fees are more that offset by the increase in business.

Jerry

 

[cubflier]

Alex-

In regard to the fees....

Why not just raise your prices 5% and give a 5% discount for cash or money order? I would think most people would pick to just pay cash then. You may want to look into using paypal, I think it costs an extra 2-5% to use it, and best of all, no monthly fee.

Tim

Just a note of interest - this would more than likely violate your merchant agreement. People do it, but part of the agreement you enter into with the provider states that the vendor pays the fee not the customer.

Jerry

 

[Rookie]

I work for Authorize.Net, which is a large service provider (for both credit cards and checks). We sell through an extensive network of resellers, including http://merchante-solutions.com/. I asked one of our marketing guys who he send referrals to, and he spoke highly of http://e-onlinedata.com/.

It's a pretty complex industry, with a large number of rate structures, and if you want more information feel free to drop me a line. PayPal is definitely an expensive way to go.

-->Aaron

 

[Alex Clark]

This is a lot of info for a guy who stayed away from a checking account and credit card until he was almost 30.

I used to get paid, go cash the check (at a bank if I was working in a town that had one, or at the AC store while living in the bush) and pay cash around town for all my bills or buy a money order for the car or land payments.
The rest of the cash I kept in a band-aid box in the medicine cabinet.
I was never in debt back then.

Now 20 years of check books and credit cards and I am in so deep it would take a diving bell to get to the bottom.

 

[Rookie]

If you find it confusing, that's probably because it is.

Feel free to call any of the customer service reps. If that doesn't work, call again to get a diffferent one. If that still doesn't help, drop me a line and I'll make sure you get hooked up with a good one. This is a service industry, you can get personal service with just a phone call.

-->Aaron

 

[zane]

The company we finally went with(my friend's company) doesn't give a rip what our website is or looks like, and doesn't require our corp name to appear anywhere(although it does.) I tend to do business with those who don't overstep their boundaries.

 

[Rookie]

I just learned of a new offering we're bringing to market as of about a week ago. It is intended to address some of the concerns of low volume merchants. You can read about it at Merchant.com, but to summarize it has free set up and no monthly fee, and we don't care what your web site looks like.

We don't do business with porn peddlers or on-line gambling, but other than that the application is a standard business credit application form.

This is new for us, let me if you have any questions or comments, I'd be very interested in hearing them.

-->Aaron