I took a 40% interest in produce market seasonal small business in a nearby town this fall. I thought it would be an educational experience and it was. It was my first experience with tradition small business merchant services, and my first experience with selling fresh farm produce, garden mums, pumpkins, and Christmas decor. WOW!
Business is business and online business is BETTER! I’ll get into that in later post, remind me!!… Back to this merchant services soap box I’ve been want to hop on for a while now. Basically being a middle man in the deal I needed to help the gentleman out that the merchant services company had sent to our temporary green house we do business out of.
As always I asked him about his business and how things were going. He explained things were a bit slow in the area and I continued asking what he actually did. He was a sales person and service contact, he was good at what he did I might ad. Here is the thing though, before he left I ask, so how does your company actually make money besides us buying this machine? This answer revealed what could possibly be a great business idea for 2010.
In a matter of fact way he let me know that when we used the machine his company received a smallpercentage of the transaction, it all happened automatically and we would not receive any paperwork, ” It’s fully automated”, “hands free”, he explained. (yeah for you)
After he left I got to thinking, a small percentage of every transaction, wow. The merchant account enabled us to accept credit card payments in this location and without it we just could not have done it. There are statistics that say people spend more when a credit card is an option for payment, so we need a merchant account to accept payment.
Some companies offering merchant servicesonly get around 1.5% and more in special cases, imagine that. I mean there are businesses out there that don’t operate with a profit margin much above that! Talk about a passive business! Well I’m sure merchant service companies have all their own headaches to deal with.
Security has to be a huge threat and thus expense in the industry as well as the infrastructure and data storage. I know that little black machine makes our lives easier but it kinda felt like I had a leech on my ankle every time I swiped a credit card through the thing!
Starting a Merchant Services Business
I looked into the merchant services business a little, far enough to say it wouldn’t be on my 2010 list of business ideas to pursue. Most successful small businesses accept credit cards and I think it is a solid business to get involved in if your looking to take on that kind of overhead and time commitment, as for me I’ll keep it online. Internet merchant accountswork the same way, on percentage. My merchant service provider will be paypal or google checkout for the time being, ya, I know they take a piece too.
What has been your experience with merchant service providers, do you have one you can recommend, maybe one to steer clear of in 2010?
What is the best way to accept credit cards online?
I do some transactions with pay pal, it has worked so far. For business ideaswith larger ticket items or transactions I prefer wire transfer, I get to keep all the money that way. Sometimes it only makes sense to use a provider though. Running a successful home business means watching expenses, but you have to do business and accepting payment is part of the game. Easy is easy but it ain’t free.