Thinking Outside the Square
With cash transactions comprising an ever-shrinking percentage of customers’ payments, it is more important than ever for business owners to be sure that their credit card payment processing is tailored to their needs and as low-cost as possible. Yet many businesses simply go with the best-known national processors and do not even research local – and often more affordable – options.
Working to change that, and to help small, local businesses maximize their profitability, is Alison Burns, founder and CEO of Precision Payment Systems. Since 2013, Precision Payment has helped business owners understand the surprising number of options available to them, and provided them with the payment processing structure that provides the greatest combination of service, efficiency and low price.
“We are not processors ourselves, we are independent brokers of merchant processors,” explained Burns. “This enables us to help determine what is really going to fit your needs for your business model.”
While some enterprises may need nothing more than a way to process payments and get money deposited into their accounts, others can benefit from a wide range of related services. As examples, Burns cited things such as inventory control, sales tax calculation, tracking top volume sales days and hours, and creating individual server codes as a way to track which employees are generating the most sales.
While Burns regularly takes on established businesses who are switching to her service, she emphasized the importance for new companies to get started with the right system. “Be thoughtful and make a list of what you need,” she advised. “Think of how your business may grow with your customers, and how you can best serve your customers, not just now but in a few years from now.”
Many different factors influence the rates businesses pay for payment processing. The number of additional services is obviously one factor. However, Burns said that “card-issuing banks and brands set their interchange [wholesale] rates, and there are over 600 types of rates. Then different processors have variable rates from there.”
Another factor is what Burns called “the business environment. What percentage of sales are card-not-present sales?” Retailers that have 60% or more of card-not-present sales – via online sales, phone sales and so on – are perceived to be more susceptible to potential fraud, and will pay a higher payment processing rate.
Also influencing rates is volume of transactions; not surprisingly, a high number of transactions per day earns a better per-transaction rate. However, a potential counterbalance to this is the average transaction amount. So, for example, a coffee shop might have hundreds of small transactions per day, while a car dealership might have a handful of large transactions per day. These two very different types of businesses should seek equally different types of fee structures for their payment processing.
The large number of variables is what makes Precision Payment’s services so valuable to its customers. “The mass payment producers are just not customized,” stated Burns. “We offer systems that are just as easy to use, but they are specific to your needs. We are not just jamming a square peg into a round hole.”
In turn, Burns noted, “we can often provide a better rate than the mass producers. We offer a ‘meet it or beat it’ price guarantee, so you know you are getting the best deal.”
Another benefit of using a local firm is getting local responsiveness. “Instead of waiting on hold for two hours when you have a problem,” said Burns, “you get fast, face-to-face service.”
Burns offers new customers a complimentary initial consultation, and helps business owners determine their specific needs and priorities. She often advises choosing a start-up approach, with re-evaluation in three, six and nine months. “Businesses grow, technologies change,” she observed. “Things like e-commerce or recurring payments get added.”
With small business facing so many challenges these days, Burns’ approach is obviously attractive to local business owners, as Precision Payments realized nearly $36 million in revenue through the first three quarters of the year. When every penny counts, and needs to be counted, the right payment processing system truly does make a difference in business success.