One of the most common things I hear from business owners is, “I already have a great rate.”
Sometimes they’re right.
Most of the time, they’re not.
Recently, I met with the owner of a Marin business who believed he was paying just 1% in credit card processing fees. He believed he had negotiated an exceptional deal and didn’t think there was much room for improvement.
After reviewing his processing statements, I discovered a very different story.
The payment processing industry has never been known for transparency. Many providers advertise rates that sound incredibly low, but those rates are often layered on top of other costs that business owners don’t fully understand.
In this case, the business owner believed he was paying 1%. What he didn’t realize was that the 1% was being added on top of interchange costs that had already been marked up. Additional fees were layered into the account as well. By the time we calculated the true effective rate, he was paying close to 4% on his processing.
He thought he had one of the best deals available.
In reality, he was dramatically overpaying.
Unfortunately, this happens more often than most people realize.
One of the biggest misconceptions in our industry is that a quoted rate tells the whole story. It doesn’t. Every business operates differently. The types of cards your customers use, your average transaction size, and how payments are accepted all affect your true processing costs.
For example, a coffee shop processing thousands of small transactions has very different needs than a business processing a handful of large-ticket sales. Yet many processors offer the same pricing structure to both businesses.
That’s why we don’t take a cookie-cutter approach at CHIPP.
Instead of offering a standard rate, we review how a business actually operates. We analyze statements, transaction patterns, card types, and processing methods to identify opportunities for savings.
For this particular company, we presented several options. They ultimately chose a compliant dual-pricing model that shifted processing costs away from the business. The result was nearly $70,000 in annual savings. Even if they had chosen to stay with a traditional pricing model, we still would have saved them thousands of dollars each year simply by eliminating unnecessary fees and bringing transparency to the account.
What I enjoy most is seeing what those savings mean to local business owners.
That’s money that can be invested back into employees, equipment, marketing, growth, or profitability. Instead of sending tens of thousands of dollars to processing companies, that money stays where it belongs—in the business.
If you’re reading this and thinking, “I already have a great rate,” I’d encourage you to let me take a look.
If you truly have an excellent processing setup, I’ll be the first to tell you. I have no problem confirming that you’re getting a great deal.
But here’s what gives me confidence: there still hasn’t been a single business in Marin that we haven’t been able to save money for.
If you haven’t reviewed your payment processing in years—or you’ve never had an independent analysis done—there’s a good chance you’re paying more than you need to.
Please don’t hesitate to reach out for a free consultation and statement review. There is no obligation and no pressure—just a straightforward analysis to determine how much money you could be keeping in your business instead of paying in unnecessary processing fees.
Steven Schaefer, founder of CHIPP Payment Processing and longtime Novato resident, helps Marin businesses reduce costly credit card processing fees and keep more of their hard-earned revenue. There isn’t a local business we haven’t been able to save money for. Call 415-246-2988 for a free consultation.
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