There are so many decisions to be made when opening a business. How many products will be sold? What kind of advertising media will be utilized? Where will the business be located? What types of employees will be needed? And perhaps most importantly, what forms of payment will be accepted?
If the business will be accepting credit cards from customers, then some sort of merchant account will be required to authenticate and process those transactions. This may sound like another daunting task on your list, but rest assured that setting up a merchant account will greatly benefit almost every type of business that exists today.
There was once a time where the majority of people paid by cash or check for their goods and services. A few decades ago, credit cards were usually reserved for major purchases only, while day-to-day transactions were paid for with personal checks or hard currency. But times have changed drastically in the 21st century and so have buyers spending habits.
A large number of consumers do not carry much (or any) cash on their person because they feel they may be singled out for theft or burglary. Similarly, many businesses are shying away from cash transactions for fear of becoming targets of robbery. As for checks, the emergence of fraud and forgery has led companies and retailers to refuse this type of payment in order to avoid the aggravation of bounced, stolen, or counterfeit checks. Because credit cards are standardized and widely distributed, business can feel secure in their transactions without worrying about being targets of crime.
There are specific merchant accounts that are best suited for various types of businesses. Most retailers utilize one or more retail swipe terminals to process credit card transactions. These devices are set up at cashier stations for use by clerks, salespeople, or customers. Businesses that provide services at remote locations often prefer a mobile account. This type of arrangement allows credit card payments to be accepted using a portable swipe terminal, a laptop system, or even a cell phone. Other merchant service provider options include point of sale software or touch tone technology, which utilize computers and phone lines respectively to handle credit card transactions. Though most types of businesses can use these two alternatives, they are especially attractive for companies that accept orders and payments via telephone, fax, mail, or email. Internet businesses accept credit cards almost exclusively.
Some business owners avoid enlisting the services of a merchant provider in an attempt to keep costs down. What they do not realize is that the decision to not accept credit card payments likely chases off customers. For the sake of convenience, many consumers will patronize a competitor that accepts credit cards. While overhead costs may be a bit lower, revenue will be significantly worse in the long run. Also, business proprietors can determine which merchant account is the most cost-efficient for them simply by doing a little research. Shopping around for processing equipment or software can help businesses obtain a system that has only the features they want at the lowest possible price.
It also pays to compare the discount rates and fee structures of several different merchant providers to see which one is the most affordable for the volume of credit card transactions the business expects to process. And thrifty business owners can minimize their merchant account costs by keeping a watchful eye on their credit card traffic. This attention to detail will enable business owners to stay away from penalty surcharges, avoid increased discount rates, and limit the possibility of chargebacks which in turn will keep costs lower
Other company owners overemphasize simplicity in their business approach, which may cause them to avoid credit card processing. They may not realize that most of todays merchant accounts are straightforward and user-friendly. Retail swipe terminals guide the clerk and/or customer through each step of the process, while computer software comes with intuitive procedures and simple formatting to expedite both credit card data entry and recordkeeping. In all cases, funds are automatically transferred into the companys account, thus eliminating the need for an employee to make a trip to the bank. Finally, credit card processing systems usually have strong support networks to assist their clients. These help centers allow businesses to ask questions and receive assistance via email, telephone, or online instant messaging often 24 hours a day, seven days a week.
There is really no good reason why any business should avoid setting up a merchant account to process credit card payments. Though the application and setup process may take a few weeks, the processing system itself usually operates with minimal oversight from the business owner. But the sharp increase in revenue that results from the increased convenience for customers will surely be noticed every time the business owner checks the company bank account.
About the Author:
Chris Martin is a freelance writer who offers information about how to get a merchant account.