Go Back   tanTALK - Tanning Salon Business Owners Community > TanTalk Central > General Tanning Industry Discussions

General Tanning Industry Discussions Tanning Salon Owners and Professionals in The Tanning Industry Discuss a wide Variety of Topics.

Reply
 
LinkBack Thread Tools
Old 07-25-2012, 09:05 AM   #1 (permalink)
Team TanTalk
 
House of Tan's Avatar
 
Join Date: Oct 21 2003
Location: The Fort
Posts: 942
Rep Power: 21 House of Tan has a spectacular aura about House of Tan has a spectacular aura about
What are you really paying to take credit cards?

When people do the math; most find the same thing. One may think they have a great rate, but the end of the month numbers tell the true story. I don't care what the “per swipe fee” and “%” is, I care about my real total cost.

If you are reading this and have yet to do the math, do it right now. Below is an example:

The only way to know what you are truly paying is to divide your sales by your merchant charges.

Take your net sales* for the month and divide in to the charges/total fees** that your account was deducted**

*Net sales = total sales - refunds, credits, adjustments (real money deposited in to your account)
**Total charges/fees = the total charge from your processor including ALL fees

so...

241.28/9134.92 = 0.02641 (or) 2.64% total cost

What are you really paying to process cards?
__________________
Startbucks
House of Tan is offline   Reply With Quote
Old 08-04-2012, 11:39 AM   #2 (permalink)
 
Join Date: Mar 10 2008
Location: Boardman, Ohio
Posts: 27
Rep Power: 0 ANNIEDOM is on a distinguished road
Re: What are you really paying to take credit cards?

Is everyone using interchangable rates? I just found out that it is a lot cheaper when u do this. Does anyone agree
ANNIEDOM is offline   Reply With Quote
Old 08-04-2012, 12:03 PM   #3 (permalink)
Team TanTalk
 
House of Tan's Avatar
 
Join Date: Oct 21 2003
Location: The Fort
Posts: 942
Rep Power: 21 House of Tan has a spectacular aura about House of Tan has a spectacular aura about
Re: What are you really paying to take credit cards?

The interchange rate is the rate from the card backers; IE: Visa, MC, and Discover. You pay your processor a small fee on top of that: Basis points.

There are two ways that processors price their offerings: Tiered plans and Cost-Plus plans.

I think you are talking about Cost Plus; this is where you pay a set amount above whatever that card cost the processor to run (the interchange rate). This is the best plan for most everyone in this business.

With tiered plans they show you a low "swipe fee" and “percentage”, but that price quoted to you is the lowest level of many levels of charges and since most card holders have points/rewards cards, you are quite often swiping cards that fall in to the more costly tiers and then they kill you on the fee.

Whereas Cost-Plus you are agreeing to a set basis above the interchange rate set by Visa, MC, and Discover.

Bottom line is… the formula I posted; because even with Cost-Plus some processors will add extra charges like: batch fees, statement fees, compliance fees and so on. So you just have to do the math.

You should be able to land a bottom line cost around 2%.
__________________
Startbucks
House of Tan is offline   Reply With Quote
Old 08-09-2012, 12:13 PM   #4 (permalink)
 
Join Date: Feb 3 2007
Location: Tyler, TX
Posts: 5
Rep Power: 0 MCtanzone is on a distinguished road
Re: What are you really paying to take credit cards?

Hey House of Tan,
how many tanning beds do you have?
MCtanzone is offline   Reply With Quote
Old 08-09-2012, 01:00 PM   #5 (permalink)
Team TanTalk
 
House of Tan's Avatar
 
Join Date: Oct 21 2003
Location: The Fort
Posts: 942
Rep Power: 21 House of Tan has a spectacular aura about House of Tan has a spectacular aura about
Re: What are you really paying to take credit cards?

Zero now; I run a spray tan salon.
__________________
Startbucks
House of Tan is offline   Reply With Quote
Old 08-09-2012, 01:07 PM   #6 (permalink)
 
Join Date: Feb 3 2007
Location: Tyler, TX
Posts: 5
Rep Power: 0 MCtanzone is on a distinguished road
Re: What are you really paying to take credit cards?

You made those kind of numbers with just spray tans !??
MCtanzone is offline   Reply With Quote
Old 08-09-2012, 03:23 PM   #7 (permalink)
Team TanTalk
 
House of Tan's Avatar
 
Join Date: Oct 21 2003
Location: The Fort
Posts: 942
Rep Power: 21 House of Tan has a spectacular aura about House of Tan has a spectacular aura about
Re: What are you really paying to take credit cards?

That was a CC statement from when I also had an H/P unit (1 spray unit, 1 H/P and retail). I may not be the biggest grossing salon in America, but I am definitely in the top 1% of gross and net per unit. My B.H.A.G. is to gross over $100k in just spray service in 2013 w/ just 1 booth.

I follow the manufacturing principles of LEAN. It works well especially for the spray only concept (what I have morphed into).

Throughput, Gross Margins and Inventory reduction
__________________
Startbucks
House of Tan is offline   Reply With Quote
Reply

Bookmarks



Currently Active Users Viewing This Thread: 1 (0 members and 1 guests)
 
Thread Tools

Posting Rules
You may not post new threads
You may not post replies
You may not post attachments
You may not edit your posts

BB code is On
Smilies are On
[IMG] code is On
HTML code is Off
Trackbacks are On
Pingbacks are On
Refbacks are On

Similar Threads
Thread Thread Starter Forum Replies Last Post
Who do you use to process your credit cards thru? spraytannedjenn General Tanning Industry Discussions 25 02-14-2007 08:55 AM
Credit Cards SunshineTans Tanning Salon Management 6 10-21-2005 02:57 PM
eft\'s or credit cards Moses New To The Tanning Business 5 05-20-2005 03:20 PM
Credit Cards bymidnight Technology Forum 1 01-11-2004 09:56 PM


All times are GMT -5. The time now is 12:51 AM.


Powered by vBulletin® Version 3.7.2
Copyright ©2000 - 2024, Jelsoft Enterprises Ltd.
LinkBacks Enabled by vBSEO 3.1.0
Copyright 2009 - tanTALK.com

click here for advertising info!