This is tip #1 of the How To Save $80,000 Series
Merchant Services (Savings: $750)
Credit card merchant services are a good place to start looking for savings. Fees for processing credit cards payments can be like a small leak under a sink. The amount of water may be small, but over time, you’ll soon have a large puddle. Likewise, a high discount rate on every transaction can add up month to month.
The savings can depend on how much volume the practice processes through merchant services but our practice saved about $65 a month by switching over to a new company. Not a big number, I know. But that adds up to $750 a year.
Depending on the size of the practice, $750 a year can pay for the company’s Christmas dinner, buy a new computer or a new TV for the waiting area. Even donating the money to charity is a better option than giving it to a merchant service company.
The hardest thing to manage here is comparing apples to apples. Each merchant company has their own way of making money. So comparing the “discount rate” (I’ve always thought it is funny they call it a discount rate when it has nothing to do with a discount) or percentage per transaction is not enough. Don’t let the low percentage rate fool you. Often times there are fees in addition to the discount rate. Rates also vary by type of credit cards the patients use (reward credit cards vs debit for example).
It is important to shop around and compare each detail of the merchant’s offering. For this transition, I called a couple of companies and compared their rates and fees. I made sure to have our current merchant statements on hand while on the phone to ensure a proper apples to apples analysis. You’ll need to know how much a month the practice’s currently processes as well as the average ticket item and any additional fees the merchant charges.
Hope you find this tip helpful and good luck finding a good deal out there.
If you’ve done this or something similar, make sure to share it with us. Oh, and let us know how much you saved. Cause that is really the best part.
Tomorrow I’ll be talking about credit cards and how using credit cards can actually be a benefit to the practice.