Recently a local supply company in Albuquerque called me because they said their credit card machine was not working and I came recommended to them. After our initial meeting, I found out that there was nothing wrong with their credit card terminal. The issue was that the corporate office required them to enter transactions into a virtual terminal on the Internet, and it consumed 15 minutes of their time for every transaction. It was not only a laborious process, but also frustrating for their staff and customers. On the other hand, using the credit card terminal was a simple swipe, and done in 10 seconds.
The staff had no understanding of why they were instructed to use the virtual terminal. In fact, their terminal was programmed to add a surcharge to each transaction, and they thought it would be better for the company to collect the surcharge from the customer to cover the cost of the credit card transaction.
I knew immediately what was going on, so I explained. The supply company worked almost exclusively with other businesses, and as a result almost every credit card transaction was some type of corporate or purchasing card, otherwise known as a “P” card. Corporate cards and other “P” cards cost a higher rate to process than regular credit cards or debit cards. If a merchant can pass through extra information about a corporate card transaction, then that “discount” rate of processing downgrades to a lower rate because the risk of fraud is lower, therefore saving the merchant money.
This supply company had their staff going online to a virtual terminal and entering a bunch of information like sales tax, shipping info, SIC code, and more, in order to lower the risk, lower their rate, and save money on the credit card processing fees. However, what the corporate office didn’t recognize, is that they were spending more money in payroll than the money they were saving on the rates. They were even spending more on payroll than the surcharge they were collecting from their customers if they instead used the terminal. Example: A twenty-dollar-per-hour employee wasting 15 minutes, wastes $5, and the markup of 1% on the rate for a $100 corporate card transaction, only cost $1. The savings on the 2% surcharge programmed into the terminal is $2.
What they don’t know is that there exists other technology that automatically passes through enough extra data about the corporate card transaction in order to lower the risk and their rates without the laborious task of entering it manually. Electronic Money Company is uniquely invested in this advanced technology. The Albuquerque office for this supply company has now been educated by having talked to me, and is in the process of suggesting to their corporate office to switch to a processor like Electronic Money Company.
Electronic Money Company watches over their clients with the client’s best interests in mind. We guide merchants on how to grow profits by reducing expenses, and therefore improving their bottom line. If you take payments from corporate accounts, email me at ghollowell@ElectronicMoneyCompany.com to find out how much you can save with this technology!