Category Archives: Small Business Articles
Businesses have become highly mobile over the last couple of years, but recent advancements in mobile credit card processing apps have made it oh so much better. Mobile merchants like limo drivers, home service repair technicians, holiday light hangers, home party consultants, and massage therapists can now accept all forms of payment instantly, using their mobile phone. Here are a few ways businesses accepting credit cards on their cell phones can increase sales.
Attract Cashless Customers
In today’s highly plastic world, customers rarely carry cash. Using debit cards for purchases has become more popular and attractive to consumers in 2010. Mobile business owners can now cash in on their cashless customers by offering credit and debit card acceptance, directly on the spot.
Higher Ticket Amounts
Numerous studies have revealed that consumers spend more money when they are paying with a credit card versus cash. Capture this human tendency by giving your customers the option to pay with a credit card when the purchase decision is being made.
We are all guilty of it-impulse buying, especially at those large warehouse stores. But, those large warehouse stores are on to something…strike while the iron is hot, and sales will increase. Mobile merchants using cell phones, like the Apple iPhone or iPad, can do this by walking around their store (or kiosk) with phone in hand. Eliminating customer check out lines will increase sales by reducing the amount of time consumers have to contemplate the purchase.
Businesses that accept credit and debit cards appear more professional, and legitimate than those companies who accept cash only. Mobile merchants with no means of electricity were once saddled by this way of thinking. Thanks to smartphones like the Droid X and HTC EVO, these image issues can be overcome.
Consumers Never Lose Sight of Their Cards
One great advantage to mobile phone credit card acceptance is the fact that the consumer never loses sight of their card. This greatly reduces the chances of credit card skimming, or the illegal copying of credit card information. Consumer confidence and reassurance in your business is a great way to increase sales, and repeat business.
Credit and debit card payments have become the preferred method of payment for most consumers. Mobile phone credit card processing can increase sales by attracting cashless customers, project a professional image, promote cardholder security, and capture impulse buys and higher average ticket sales.
To get started accepting credit and debit cards with hundreds of different mobile phones visit www.paymentmax.com
Two common questions I receive are: what are merchant account basis points? And why do merchant account providers use the basis point system?
Basis points are simply the percentage of a sale that a merchant pays their merchant services provider to process credit cards, or the discount rate. Basis points are expressed as 1/100th of 1%, or 0.01%. For example, a business with a basis point of 149 has a discount rate of 1.49%. Or, a basis point of 34 would equal 0.34%.
Merchant account providers use the basis point system when referring to the discount rate because it gives a whole number representation, instead of using fractions and decimals. It is much easier to communicate with whole numbers versus fractions of a percentage.
Merchants must also remember that with a tiered merchant account, the first tier will always have the most basis points, followed by the mid-qualified and non-qualified tiers. The second and third tier basis points will represent the surcharge, plus the first tier qualified rate. For example, the qualified rate (first tier) may have a basis point of 159, or 1.59%, followed by a mid-qualified surcharge of 35, or .35%, and a non-qualified surcharge of 100, or 1%.
The PAYware mobile encryption sleeve is a small device that connects to your iPhone 3G, or iPhone 3GS. The encryption sleeve allows you to physically swipe your customers creditor debit cards. Swiping credit cards are attractive to mobile merchants because they cost the least amount of money to process-”swiped rates”.
Here is where you can find the PAYware mobile encryption sleeve.
New debit card legislation will have the federal government policing the interchange rates charged to merchants for their customers debit card transactions. While the specifics of the new law are being worked out, here is what merchants can expect.
1. Merchants could set a $10 debit card transaction minimum.
2. Merchants would be allowed to offer cash discounts for use of cash over a debit card.
3. Government debit cards and reloadable pre-paid cards would be exempt.
4. Banks with over $10 billion would be subject to the fee oversight.
5. Fees would have to be reasonable and proportional to processing costs. The Feds have 9 months (after the bill was signed into law) to figure this out.
With over 1.6 trillion dollars in total debit card purchases in 2009, this new legislation is sure to have an impact on all parties involved, large and small. Whether the impact will benefit the consumer is yet to be seen. Some are speculating that the cap on “swipe” fees will only benefit the big retailers like Wal-Mart and Target, while consumers end up fitting the bill with less bank services, and minimum transaction amounts.
Unfortunately, employee theft is a concern that all business owners have, whether big or small. According to the National Retail Federation, employee theft contributed to a sales loss of over 35 billion dollars in 2008. Employee theft ranked #4 in major sources of shrink, coming behind vendor fraud, administrative errors, and shoplifting. With so many dollars being lost to employees with sticky fingers, it is no wonder business owners are watching them carefully.
Here are some tips to help reduce employee theft in your business.
1. Be on the look out for employees that have a calculator, or receipt books at the point-of-sale. These employees might be using these tools to deceive customers into paying more, while they pocket the money.
2. Look at cash vs. credit ratios. The typical cash to credit ratio is 30% cash to 70% credit. If cash ratios drop below 30% start asking questions.
3. Business owners and managers must stop by often, and make those appearances unannounced. Research shows that frequent, surprise visits by the boss, reduce employee theft.
4. Encourage employees to report incidences of theft by fellow employees. Callers should always have the right to do so anonymously. If they do reveal themselves, consider offering a reward.
5. A high amount of no sales can be an indicator of theft. If the cash drawer is opened frequently, without a corresponding sale, someone might be helping themselves to the contents.
6. Inventory tracking system. Businesses must have a way to precisely track their inventory, before they can get a handle on employee theft. Tracking must also include loss to other factors, like damage or spoilage.
7. Train employees. Train employees. Train employees. This cannot be stressed enough. Train them on the companies anti-theft measures. Let them know they are being watched.
8. Post signs. Post employee theft hotline signs where employees take breaks and clock-in. Remind them that your company has a zero% tolerance on employee theft, even if it is just a soda!
9. Spot check. Business owners and managers must make spot checks of cash register drawers and inventory on a routine basis.
10. Z tape. Follow the control number on the z tape to insure that all tapes are accounted for. One franchisee found that an opening employee would close out the register 2 hours into his shift, and then pocket the money. Missing z numbers is what led them to the thief.
and last but not least…keep an eye on your returns. Employees with a higher than average return rate, may be ringing false returns and pocketing the money.
The FD100 Ti is an affordable, all-in-one terminal solution for retailers, restaurants, quick service restaurants, mail and telephone order, grocery stores, and electronic commerce. This terminal is one of the fastest, sleekest terminals available. Here are the FD100 Ti specs.
-Easy to use touch-screen display. 128 X 64 graphic LCD display.
-Fast terminal downloads using IP or dial-up over a standard 56K modem.
-Easy support of IP and dial-up with secure SSL encryption.
-True 32 bit processing (ARM 920T 32-bit CPU core).
-Quick and Easy drop-in paper loading system.
-Compact design with sleek titanium look.
-Upgraded, faster CPU (ARM 9 400Mhz).
-Windows CE 6.0
-Verification and processing capabilities for ATM, debit, EBT, and check payments.
-15 line per second printer capability.
-Merchant friendly one-touch daily functions.
-Three-track magnetic stripe reader.
-64 MB RAM standard memory.
-Three USB ports.
-Address verification system.
-Simplified support and installation.
-2.25 inch wide thermal roll printer
Installation of the FD100 Ti is quick and simple. A few minutes is all it takes for set-up. Contact PaymentMax to get started processing with the FD100 Ti.
Business owners are all too familiar with merchant account downgrades. These downgraded transactions cost more money to process, and are typically referred to as mid-qualified, or non-qualified transactions.
Transaction downgrades can occur for a variety of reasons, like failure to batch on-time, use address verification (AVS) on card-not-present transactions, or keying in a card present transaction. While these downgrades are due to improper operations and can be controlled (for the most part), other downgrades cannot be avoided; these are card type downgrades.
Here are the credit cards that will process at a higher rate.
Strict card association rules prohibiting payment card discrimination prevent merchants from refusing these cards. Doing so could result in a terminated merchant account file (TMF). Merchants may not be able to control card type downgrades, but knowledge of their existence can help merchants understand their monthly processing statement better. An understanding that can be used to reduce controllable merchant account downgrades.
Illegible transaction copies can be a source of lost chargebacks disputes, simply because the original transaction receipt can not produce a legible copy.
When a copy request is initiated by a customer, the merchant must make a copy of the original transaction receipt. This copy must be mailed, or electronically sent to the acquirer. If the copy is to light, small, or on colored paper the copy may not be readable, defeating the purpose of the copy request. Illegible receipt copies could be returned as a chargeback.
Here are some tips for avoiding illegible receipts.
1. Change point-of-sale printer cartridges routinely. Ensure staff are properly trained on how (and when) to change POS printer cartridges. Faded, barely visible ink on sales receipts is the #1 cause of illegible receipt copies.
2. Change printer paper at the right time. Printer paper should be changed once the colored streak appears on the corners of the paper. This streak indicates the end of the paper roll, and can diminish the legibility of the receipt. Train employees on the proper time to change printer paper.
3. Merchants keep the white copy. Always give customers the yellow copy of the sales receipt, it does not copy as well.
4. Carbonless paper must be handled carefully. Carbonless paper that is not stored, or handled carefully can result in blotches, marks, and scratches on the paper. These marks appear black when photocopied, and could result in an illegible copy.
5. Ensure company information at the top the sales receipt does not interfere with the transaction information. Position company logos, and other information away from sales information.
6. Microfilm reduces the size of the original receipt. Reduced images can result in blurred, unreadable copies. Original receipts should be copied at the same time microfilm is taken.
Reduce copy requests and lost charge back disputes by maintaining point-of-sale equipment properly, and ensuring that all employees are trained on POS maintenance.
Mobile businesses now can accept credit cards directly on their cell phones, opening a whole new customer base. You don’t need to have an iPhone to participate, ROAM data has a published list of compatible cell phones on their website:http://devices.roamdata.com/device-center/index2.php
PaymentMax is offering the ROAMpay swipe card reader free with new approved accounts.
There is quite a bit of speculation on just how low the Federal Reserve is going to adjust debit interchange fees. Some analysts are estimating the reduction in debit usage fees could cost banks around 5 million dollars in lost revenue. Lost revenue that is most likely going to be made up by charging consumers for banking services. Services that were once free.
According to Paymentsource.com, the Fed will announce debit interchange rates that are 25% to 75% lower than current levels. They must draft regulations within 9 months of the bill being signed into law. The new debit interchange rates would become effective 12 months after the bill is signed. Visa and MasterCard network transaction fees will not be directly regulated by the Fed.