Choose wisely
Wednesday, July 25th, 2007When opening a merchant account for the first time, you are likely to look at the rates before anything else. While this is logical, it is not necessary the wisest thing to do. So many features go into a merchant account, and one of the most important features (just as important as the rates) is the compatibility with your business revenue. Many businesses now collect money from various sources, for example, both e-commerce and retail or both phone/mail order and e-commerce. If you don’t think about these various applications before you choose a service provider, you will be locked into a contract which may not be suitable to your business needs.
When setting up your cash input method, look at your projection of initial cash flow and secondary cash flow. It is too easy to look short-term when you are making important decisions in the beginning of your business. You are eager to make money and you don’t want to spend time thinking about the details. Take my advice, stick with your big picture but concentrate on the details when these details could cost you thousands of dollars in the long-run.
The software needed to run a merchant account for a retail application as opposed to an e-commerce application is different. Look to a provider that can set everything up quickly and easily. Many providers give you rates according to the application, but most providers offer similar rates. The providers differ when it comes to set-up and modifications, both in efficiency and change charges. If you find that your business is moving towards retail rather than mail order, you need the flexibility to receive credit cards from either source with the same rates and compatible software. The software should come free with the account and should not have to cost you extra to set-up. Although your account will be managed by yourself, it is recommended to choose a simple system because as your business grows, you will be delegating this task to someone else. A merchant account is more important as your revenue grows. Make a good decision the first time.