Taking that big step, getting a credit card teminal

[Rachel <3]

Hi all,

Well, I have decided it is time to get a cc terminal. I have been using http://www.propay.com for the last 2 years and can feel my business out growing it.

For those who dont know, propay is an easy way to accept credit cards without investing in a cc terminal. You can either enter the cc info online at their website or call it it to their 800 number.

So, I called http://www.merchantwarehouse.com and spoke with a very nice gentleman named Adam. He is setting me up with a refurbished unit that will cost me $150.My monthly statement fee will be $8 and the perceneforum.xxxe is 1.79% plus 25 cents per transaction.

At propay, I was paying $60 per year and 3.5% plus 35 cents per transaction. Propay also charged me 30 cents everytime I had them deposit my money into my bank account.

When I started accepting credit cards, I was lucky if I processed 2 or 3 per month. In the past few months, I have been processing that many per week. Once Christmas rolls around I know I will be processing even more.

My propay account is limited to $500 per day and $3000 per month. If I sell 2 packages of 5, that will put me at my limit for the day. What will I tell the next person who wants to use their cc?? "Sorry, I will have to process your card tomarrow." And what if there is a problem with their card?? What a potential mess!!

The other benefit of having a machine is that my clients wont have to wait 5 minutes while I call in or punch in their card and then print a reciept. No one has every complained, but I am sure they wonder what is taking so long. CC machines are pretty standard, and most people assume I have one until I tell them I am calling in the number.

So, in less than 2 weeks, I will have my machine!!

Christine

 

[J.J.]

t023

Congratulations Christine! I'm really happy for you!
Glad you have found a resource who is making it cost effective for you!

 

[??hi?]

Just a note, most cards process at a higher rate than the quoted 1.79%. When I was with merchant warehose, most of my cards processed at 3.3% due to cash back, rewards and mileage type cards. Very few were at 1.79. Plus, MW gets you coming and going with batch fees.

What I thought would cost me only about $20/month usually ended up costing well over $50. Once I finally sat down and did the actual math, it was disheartening. I switched a short time ago to Nova through Costco. I am saving a significant amount of money, but due to MW's cheap terminals it created quite a problem. MW uses an old version programming in their terminals, so if you switch to another carrier you will need to either purchase a new one or pay a swap fee.

Also, it's really hard to get your account closed down. I had to send the request by snail-mail, since they won't accept a faxed signature. And they only process the account closures three short days a week. Since my request spanned almost two weeks, I ended up paying my full fee for an extra month.

I was really happy with MW at first, but eventually it felt like a bait and switch.

 

[plmkoi]

Thanks for the info Breathe. I havent signed anything yet, so there is still time to look around. There isnt a costco in my state, so I doubt if costco is an option for me. I did find this company tho, anyone have experience with them?? http://www.advancedmerchantservices.com/comparison-chart.html

Christine

 

[Gabriele]

I don't like being locked in either. And I did have to sign a two year contract with Nova/Costco. It is MUCH cheaper for me. For one, I have an executive membership, so my statement fee is waived, (only $5 anyways), but that perk makes my Exec membership cost $10 less a year than my regular business membership did.

My processing rate for mid- and non-qualified is much closer to the qualified rate. Maybe it's just here, but EVERYONE has a "rewards" card. Last month, processing mostly mid and non-qualified, my service cost me a grand total of just over $20. (It was a light month.) I don't pay batch fees, so that saves me about $.50 a day. ($15/month)

I figure on an average fully booked month, my CC fees will cost about $35 (or less) with Nova, whereas with MW, I had at least one month that was $58, and it's just me.

For reference, I process about $1200 max in card receipts in a busy month. I'm coming in at about 2.5-2.8% now. With MW, I averaged about 4.2-4.4%. My break even point with Costco and MW is about $450 by the time you add in batch fees, statement fees, higher mid and non %, etc.

 

[Pompal 09.]

Christine, that comparison chart is very misleading. It doesn't address all of the other associated fees, which can be different from merchant to merchant. I learned that the "upfront" expenses don't tell the story at all. You need to look at batch fees, transaction fees, statement fees, if there is a fee for itemization, their mid-qualified rate, non-qualified rate, if there is an introductory rate that will change in 6 months, etc.

It's easy to get burned. It is SO worth having CC processing, but it's a PITA to figure out.

 

[Pompal 09.]

breathe,

do you have to buy costco's machines?

 

[Ericho]

I don't know if you have to buy Costco's machines. I owned a machine that I had to "swap," so it would be compatible. I suppose if you buy Costco's CC machine it is probably compatible with Nova, but to be on the safe side, you should take down all the product info, then call to confirm.

 

[Bond Reeves]

Wow, that is all I can say. Even if merchant warehouse isnt what you liked breathe, let me tell you from talking to business people in my community, it is a great deal!! There are a ton of retailers around here leasing machines!! One in particular, a friend too, leases his machine for $40 a month!!! I told him I can buy one for $150, and he said his was much much more expencive, so leasing was a good option for him. From what I could tell, his machine looked pretty much like the ones MW is selling for $150 to $200. I imagine the sales person he dealt with inflated the price of the machine.

Apparently, ripping off retailers by cc processing companies is fairly common. Hidden costs, long leases, etc.... If someone got into the business honestly and didnt try raping businesses who need cc machines, they could make a killing on volume.

Christine

 

[hantsgirl53]

Oh don't get me wrong, I think Merchant Warehouse processing is a better deal than many of the credit card retailers out there. It's just that at no time was I warned of the many ways I have to pay tiny fees, (in addition to the 1.69% + $.25) nor of the projected number of cards that process at mid or non qualified rates.

Things ended up being significantly more expensive than I had originally calculated, and I got tired of calling to find out why my bill was consistently double what I expected, and having them say "Oh yes, that's because you forgot to figure in THIS charge," yet another charge hidden in the fine print as an occasional charge that really happened all the time.

I'm really happy with the Costco processing, the way they do their transactions makes it really easy to calculate at the end of the month, since they charge all % fees in one lump sum, instead of taking the %1.69 off the top of each, then billing the difference at the end of the month. It made tracking kind of nightmarish. Not to mention saving $20-30/month.

Ultimately though, I switched, not because of the fees, but because I had some questions about my account, setting up an internet gateway, and changing my deposit account. I contacted them numerous times over an 8 week period, by phone, email and online comment form, but nobody could be bothered to get back to me. After 8 weeks, I figured that was sufficient time for them to begin treating me like a customer, so I took my business elsewhere.

As far as the machines, an $800 machine looks the same on the outside as a $200 machine, but the programming could be very different. It seems different versions use different encryption methods, so the memory could be substantially more on a higher priced machine. I don't know what difference it makes, but that is one of the reasons for a spendier machine.