Businesweek recently profiled a small boutique’s struggle and success in getting lower credit card processing costs. With revenue of $350,000, the business was able to save about $4,000 using the strategies listed below.

A recurring trend that we see from our users is they are told by processors the fee they are paying is one number, but then when the business researches and calculates their actual rate, it equals sometimes double or triple what they thought they were paying.  The same happened to the business profiled in the article, which leveraged some research to bring down her fees.

We applaud business owners’ efforts to learn as much as they can about the credit card processing industry, and we function to provide businesses with an unbiased, apples-to-apples comparison from top quality processors.  We know it’s a tough,  complicated market which functions to confuse business owners, so we strive to make the process simple and easy for businesses. Below are some helpful tips to cut processing costs which we’ve mentioned before,  however they are highlighted in the Businessweek article:

1)   Get multiple bids from processors- Plan on getting at least three bids from multiple processors when shopping for a credit card processor. Businesses can leverage competing bids, but also get an idea as to a suitable range for cost.

2)   Never lease a terminal- The business in the article was paying $50/month to lease a terminal when one can be purchased for more than half the cost of leasing. This is a typical practice, so make sure to do as much research/cost analysis as possible on buying a terminal.

3)   Negotiation is the name of the game- Use the research from shopping to go back to processors with aggressive cuts. The margin for sales is incredibly high, so are rates are much more flexible than businesses realize. Make sure to try and get rid of monthly fees.

4)   Make sure to fully understand billing statements- Even after the contract is signed, make sure processors don’t sneak in random fees or arbitrary costs. Confusing billing statements are standard industry practice from processors capitalizing on their clients’  misunderstanding.

5) Interchange plus only- In contrast to confusing tiered pricing which charges different rates based on how “qualified” a credit card is, interchange plus is the most transparent form of pricing. Learn more about interchange pricing here.

6)   Use FeeFighters- Ok, so we’re a little biased, but we know from talking to business owners how confusing finding a processor can be. Heck we’ve done it ourselves in previous businesses. FeeFighters is the place you can find the best deals on high quality processors who are screened to provide businesses with transparent pricing.  Use our platform to ask processors straight up questions about costs and contracts, and please ask us any other questions you may have about processing. We are here to serve businesses and help you keep more of your money.