Just give me the best rate!!
The biggest mistake that you can make when searching for the best merchant account is to throw negotiation out the window in an attempt to strong-arm providers into giving you their lowest rates and fees right away. The problem isn't that they don't want to help, it's that they don't have enough information to offer a quote even if they wanted to.
Finding a merchant account isn't easy. Even with the assistance of some helpful tools that I'll touch upon later, the process is going to involve effort and perhaps even moments of frustration. Nevertheless, getting a competitive merchant account with low fees and favorable contract terms is crucial in today's marketplace where credit and debit cards dominate consumer wallets.
I can recall from not too long ago when I used to sell merchant accounts the people that would call me and say something to the affect of, "Don't waste my time. Just give me your best rates and fees." Even to this day merchants come through CardFellow with this same no-nonsense approach. The merchant processing industry doesn't exactly have a stellar reputation and it's understandable why many people feel that they have to approach representatives with their offense in full-force.
However, the fact of the matter is that this approach is far more damaging than it is helpful and it can have the exact opposite results that what the merchant is hoping for. Merchants account aren't tangible products on which a provider can slap a price tag. They're a financial product similar to insurance and bank loans. Speaking of which, insurance is a good subject to use as an example because everyone is basically familiar with the way that it works.
Picture yourself calling an insurance broker and simply saying, "I need a $300,000 life insurance policy and I don't have a lot of time. Just give me your lowest premium." Even if they ignored the suspicious nature of your request, the broker still wouldn't be able to offer you a quote. They would need to know more about you in order to measure the risk involved in issuing you a policy. Are you a smoker? How old are you? Do you have any assets? The answers to these questions and more would dictate how much your premium would be and even whether or not you can be insured at all.
Like insurance, the cost associated with virtually every financial product is based on risk. In this regard, merchant accounts are no different than insurance or any other financial product that requires thorough risk assessment in order to ascertain pricing.
Before a sales representative can offer you a merchant account quote they need to know a few things about your business such as the type of business that you're in, the personal credit standing of the owner or principal, the age of the business, processing volume and more. They won't be able to formulate accurate pricing without this vital information on which to base a risk assessment of your business.
If you insist on staying with the hard-line approach, you will eventually find a merchant account rep with shaky enough morals to quote you their lowest rate without negotiation. This is usually where the problems begin. In the worst case scenario, you'll end up paying fees that you've never heard and when you call to complain you'll learn that you're locked into a three-year merchant account contract with a hefty cancellation fee.
Even in the best case scenario you're missing out on lower rates by refusing to negotiate. I've written countless articles over at MerchantCouncil that stress the importance and the art of using the competition in the merchant account industry to your advantage. Providers want to earn your business and they're more than willing to offer you their lowest rates and fees, but in order to win you have to play the game!
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