Successful companies get the most out of the products and services they purchase.
If you purchase a piece of equipment, for example, you need to fully understand how the machine works, and the best way to repair and maintain the equipment. By following these steps, the equipment will be most productive.
What about your payment processor? A processor is responsible for sending debit card and credit card payments from customers to merchants.
Getting the most out of your payment processor can have a big payoff for your company. If you create a great customer experience that makes buying your products easier. Find a payment processor that can handle business growth and minimize your time investment.
Use these tips to evaluate your payment processor, and to get the most out of the service.
Five Important Steps for Customer Payments
What steps must be completed to process a customer’s payment, and complete a sale?
Assume, for example, that Julie operates Sunshine Greeting Cards, a business that sells greeting cards, candles, and other gifts. The company sells items through its website, and in three retail store locations.
Here are the steps required to complete an online sale:
- Customer selects item: The customer selects an item for purchase by clicking on the item and moving to the checkout screen.
- Entering card data, purchase: At the checkout screen, the customer enters their credit card or debit card information, confirms the dollar amount of the purchase, and clicks a “purchase now” button.
- Processing payment: The payment processor sends the sales price amount, less the processor’s fee, to Sunshine’s bank account.
- Confirmation: The payment processor confirms the transaction to both the customer and Sunshine electronically so that both parties have a record of the sale.
- Product shipment: Once the payment is confirmed, Sunshine Greeting Cards sends the items purchased to the customer.
In addition, the payment processor must be able to handle refunds, price corrections, and other changes to a customer order. Sunshine also must be able to use the same payment processing technology at POS terminals in each store location.
Your payment processor must be able to efficiently handle the steps described above. However, your business needs additional tools to get the most out of a payment processor’s system:
- Website integration: You need an easy tool to integrate the payment processor’s software into your website, usually by copying and pasting some code.
- Mobile: The processor’s system must be user-friendly on mobile devices so that customers can easily navigate the site and make purchases using mobile.
- Currency management: This feature is increasingly important, as more US-based companies take orders from outside the US. Your payment processor must be able to convert other currencies (Euros, for example) into US dollars to accept payments, and the ability to convert dollars back into a foreign currency.
- Banking: Banks issue credit cards and debit cards, and your processor must be able to process payments from cards issued by both domestic and foreign banks.
- Reasonable fees: Finally, the fees charged by your processor must be competitive. You have dozens of options for payment processing, so there’s no reason to overpay for a processor’s services.
In order to grow sales and accept more payments over time, your business must have these features.
Other Key Factors
To evaluate the effectiveness of her payment processor, Julie should also consider these additional key factors:
- Error Rate: How often does the payment processor make an error? You can, for example, calculate an error rate, based on a percentage of total sales processed. If the error rate is trending up, as a percentage, you need to demand better results from your processor. Track this metric and ask your processor how they can reduce the error rate.
- Responsiveness: This factor is hugely important as payment mistakes are upsetting to your customers. 24-hour live customer service phone help (not just a chat line) is a must-have for your processor, and Julie also needs a company-dedicated service line to solve problems. If Sunshine can fix payment mistakes quickly, the firm can prevent the loss of a customer.
- User Interface: Are the payment processing reports easy to access and review? Can Julie download payment data directly into her accounting software?
These are the key factors you should use to evaluate your payment processor.
If you decide that your payment processor isn’t meeting your standards, reach out to the company and demand improvements. That’s a reasonable request since you’re paying the firm to be accurate and responsive. Give the company a chance to improve performance.
Ultimately, you may decide to find another payment processor but proceed carefully. Many firms may promise the level of service you need, but don’t have the experience or technology system to do the job.
Ask industry peers and people you trust for referrals, and interview payment companies in detail. Ask for a product demo, and review the report packages that they provide to clients. Changing vendors can work out if you do your homework.
A Business Partner
An effective payment processor should operate as a partner who helps you grow your business. The company should provide accurate information and quickly respond to your questions, and the website they provide must be user-friendly. Work with a payment processor who can handle your business growth.