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Accepting credit cards and other forms of payment to help your restaurant prosper

February 9, 2010

Taking Charge Of Everything

Today’s economy, every cent counts and adding them to your bottom line is possible in the middle of economic crisis. Here are a few steps that will increase your profits, either by boosting sales, reducing credit card fees and expenses, or blocking theft.

For businesses in the food service industry, running a restaurant point of sale system, this can greatly help you!

 

Take Checks

Checks are still widely used, especially among older customers. So if you’re still not accepting checks, starting soon would be a good idea. You will be able to find a good equipment that can scan checks as fast as credit cards, measure them against a nationwide database of bad check writers, transfers the money to your account electronically, and guarantee you receive your funds within a few days. In addition, the cost is typically lower than for credit cards and could add 10-15 percent to sales—and possibly more if you have many senior customers.

 

Accepting All Cards

Of course, you’re already accepting cards like Visa and MasterCard. How about Discover and American Express? The latter, in particular, generally accompanies larger transactions. If you’ve hesitated because the fee is higher, reconsider—the difference might be a paltry one percent or so, and because American Express transactions are often larger than those of other cards, you’ll make it up in gross profit. Furthermore, it can help keep your customers coming back because your business will be well know of accepting all forms of credit cards.

 

Do Your Research

Most merchants think their fees are 1.69% plus $.19 because that’s their qualified rate on a pricing program tier. Though fewer than 20 out of 100 transactions receive the low qualified rate and all the rest downgrade and cost one, two, or even three percent. By researching for alternate programs that offer different interchange rates that may end up saving more than what you’ve expected.

 

Insist on Understanding

Neither you nor your bookkeeper would have to scratch the back of your heads over a complex credit card statement that just doesn’t add up. There are several companies that have made far more than usual efforts to simply their reports. You should be able to reconcile your statement and rates in no more than 15 minutes.

 

Internet Reporting

You’ll never have to wait for the post office to deliver a letter disputing a charge. With Internet reporting, you will know within 24 hours, which ables you to aggressively defend against chargebacks. This type of quick action will increase your success rates and reduce your losses.

So no more scratching of the head for both you and your bookkeeper over complex credit card statements.

Using Card Validation Value and Address Verification System. They are highly effective fraud screens proven to reduce losses, and when using them correctly, you can obtain the lowest possible discount rate.

In addition, avoid by being PCI compliant. There are mammoth fines charged to merchants who are hacked, and even drives them out of business. Find time to read Visa’s report on noncompliant systems, be alert at all cost.

 

Reducing Chargebacks

For Internet and phone orders, implementing the “Verified by Visa” or “MasterCard Secure Code” plug-in on your web site eliminates all cardholder nonauthorization chargebacks. Liability for these chargebacks will be shifted away from you to the issuing card bank, and you qualify for the lowest discount rate available. By this simple step, you could possibly eliminate up to 80% of all chargebacks and increase your profits.

 

 

The author of this article is the VP of Customer Relations at POS-For-Restaurants.com with over 20 years experience helping restaurants nationwide increase their efficiency and bottom-line profits with restaurant point of sale systems.

Visit POS-For-Restaurants.com for more information on how our national network of restaurant point of sale professionals can help your business achieve greater success in these difficult economic times.

 

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