With the advent of eCommerce, small businesses can make a big impact on consumers who wouldn’t have been able to find them without a virtual storefront. This has been an incredible advancement for many companies. What’s not so incredible are some of the pitfalls that come with not using the technology to its fullest advantage.
Oftentimes, eCommerce credit card processing means thick contracts and mumbo jumbo percentages piled mountains high. There isn’t much clarity that clips the confusion and provides a straightforward eCommerce payment processing solution. Here are some tips to help you avoid making major mistakes when it comes to eCommerce processing
1. Skipping past the terms and conditions.
The most critical mistake many business owners make is skimming through the terms and conditions set out by a credit card processor without understanding them. Although the “legalese” and length of the document makes it feel ominous, the jargon has to be interpreted and combed through to avoid red flags or danger zones that could come out later down the line. Pose all concerns and questions to the potential processor to make sure they’re dealt with and goals are met.
2. Misunderstanding hidden and added fees.
Although the cost of interchange must come with eCommerce credit card processing, additional or unnamed fees don’t have to. Most processors upcharge based on the type of card (premium or corporate cards, for example) or method of use (i.e. was the card swiped or the numbers typed in by the customer). While these are understandable ways for the processor to earn their keep, they should never hide these or any other costs from merchants. Pricing tables can be convoluted and confusing, so be sure to ask questions and seek clarification. (And head for the hills if confusion persists.)
3. Overlooking foreseeable rate fluctuations.
Imagine a scenario in which the price per credit card charge is 2% one day and 3% the next. While this is a small increase, the numbers will add up over time and take a bite out of profits. The good news is that these hikes aren’t likely to happen overnight. Most are laid out in the terms and conditions (revert to step 1) to offer some foresight, and should be taken into serious consideration before any contracts are signed.
4. Agreeing (voluntarily or not) to a volume requirement
A small- to mid-sized business isn’t going to start banking a million dollars a month. More than that, it’s understood that sales will fluctuate from month-to-month. So why do some credit card processors set the bar for businesses to bring in certain sales per month or else face yet another charge or fee? It’s unfair, but often avoidable. Be aware that these penalties aren’t necessary, and a volume requirement shouldn’t be agreed upon. Fattmerchant never profits off of a merchant’s variable income, so why should the other processors?
5. Neglecting to shop around.
The information is out there, and many sites are looking to expose the seedy underbelly of credit card processing. So shop around. Consider the validity of verbal agreements, hidden fees and all the other drawbacks listed in the steps above. Read the terms and listen to the conditions set out by the contract and the company. Do your research and read the reviews. That way, you can feel confident knowing you’ve made an informed decision.
The credit card processing industry doesn’t have to be all smoke and mirrors. It’s easy to get caught up in the promises processors make now only to say goodbye to profits later. The best defense against making mistakes is to be knowledgeable and do the research, read the fine print and ask questions.
Want eCommerce credit card processing without the confusion? With Fattmerchant, your business never has to worry about hidden fees and price per volume. We’re always available to answer any questions you may have honestly. Find out how much you can save today with our zero markup, no fees, subscription-based eCommerce credit card processing solutions.