Is That Great Deal Really a Deal Otto Richter
Merchants are approached by our competitors and often unscrupulous sales agents, who will tell the merchant whatever they think will convince the merchant to sign a contract. Often, merchants are simply lied to; often the merchant only finds out the untruth after they receive their first statement, or invoice; often the merchant only finds out what they are really paying when they see the charge going through their bank account.
The recently mandated Code of Conduct was introduced by the federal government to address many of the concerns merchants have voiced, we expect there will be improvements over time, however, merchants should be aware of the misleading statements used.
The following lists some of the common statements that you will be told by Sales Agents.
“IF WE CAN’T SAVE YOU MONEY, WE WILL PAY YOU $500”
If they cannot save you money, you would not sign with them. Then why would they pay $500 and not have you sign with them? Companies making this offer, will never pay the $500, they will always point to one pricing element and claim they will save you maoney in a particular item.
For example: After analyzing your merchant statement and realizing they can not save you money, they will claim that their $0.05 debit card transaction is lower therefore they would have saved you money. Even if their overall offer actually cost you more.
This sales technique is designed to get you talking, once you begin the dialogue they expect to sell you.
We promise to be open and transparent; we will analyze your particular situation and tell you if we can or cannot reduce your costs. We are proud to say our track record of reducing costs is in excess of 92%.
“WE CAN OFFER VISA AND MASTERCARD RATES FROM 1.29%”
In this case the company is using a “Teaser Rate” to get you talking. The offer of 1.29% will catch the attention of merchants.
Visa & MasterCard does allow Interchange Rates as low as 1.29% BUT, ONLY TO VERY LARGE MERCHANTS.Only Oil Companies and grocery chains are eligible for these low rates. Companies must process a minimum of $200 million in credit card sales each year.
We do not quote “Teaser”rates, we believe in providing you with only those rates that you will pay. You wont be surprised when you receive your first Merchant Statement.
“WE CAN OFFER YOU CREDIT CARD RATES OF 1.29% or 1.39%”
The company offering the low rate must earn some amount of money from the merchant, therefore, some additional fees will be charged. Or, the Sales Person is only interested in signing the merchant and earning a terminal commission, when you realize the scam, the company has a signed contract or has sold the contract to a third party.
Many companies, including Major processors, are marketing as low as 1.29%. In order to attract your attention, they have divided the true discount rate into three categories, but only “talk” about the base card rate. This sales method plays on the confusion that Visa and Mastercard have created.EXAMPLE 1.29% – Discount Rate
+ 0.40% – Visa & Mastercard Interchange Differential Fee
+ 0.40% – Visa & Mastercard Procession Fee
2.09% – TOTAL discount rate the merchant pays
Remember: Every company must make some “profit” from each merchant or the company will not survive. The question is how much must be made!
We quote rates that are not sub-divided; you will know exactly what you will pay. Our agreements are not designed to mislead; all rates and fees are clearly listed.
“YOUR CREDIT CARD RATES WILL NEVER CHANGE – GUARANTEED”
No sales agent or company can make the statement that credit card rates will never change. Visa and Mastercard set credit card “Interchange” or “cost”; both organizations can make changes to any rate at any time and once rates are changed, they apply to every credit card processor throughout the world.
Sales Agent either is telling a “Myth” or does not understand how the Credit Card industry operates.
Once we quote a rate, that rate will not be changed by us for the term of the contract. If, however, Visa or MasterCard change their global rates, we have no choice but to follow their mandatory changes. Fortunately, that does not happen often.
“WE OFFER LIFETIME WARRANTY ON ALL TERMINALS”
Lifetime warranties are very, very rare in any industry. Companies offering lifetime warranties will recover their costs in a number of ways:
High terminal sale price or monthly lease payment, designed to cover an expected repair cost over a period of time.
Free repair cost, but high courier and handling costs, these costs are set to cover the repair costs.
Companies are not available after the initial sale, voice mail and unreturned calls are very common.
We provide the normal manufacturer’s warranty; extended warranty can be purchased at a nominal monthly fee. We will always assist you and manage the terminal repair process on your behalf, if required. We will provide you with a temporary replacement terminal for your use until your terminal is repaired and returned to you.
“OUR TERMINALS ARE THE LOWEST PRICED IN THE INDUSTRY, OUR LEASE PAYMENTS ARE THE LOWEST”
Prices varying in the industry, however, new, state of the art terminals are not sold for amounts between $495 and $795. If a Sales Agent is involved then the price must be larger in order to support the agents’ commission.
Some companies sell used or re-furbished terminals as new terminals. Often used terminals are outdated and do not conform to new security regulations such as Chip Cards.
Often a low price for a terminal does not include the cost of software or merchant setup. When software and setup is included, it is not uncommon that the final price is $1,300 to $1,500.
We sell only new, state of the art terminals. Our terminal prices include software, setup, and installation. You will not pay any extra fees. For our existing merchant customers, we offer reduced prices if their terminal must be upgraded.
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