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Credit Card Processing Designed for Health and  Beauty Businesses
20September

Credit Card Processing Designed for Health and Beauty Businesses

Written by Louis Georgakakis, in Category Payment Processing

One of the last things you want to do is change credit card processors... but should you?

A special note to owners of health and beauty businesses - are you overwhelmed by the thought of picking a credit card processing merchant service partner? Just know that you're not alone. We realize that credit card processing is not very sexy, or fun. However, saving you thousands of dollars is worth your time and effort - learn how you can put more of your hard-earned dollars into your bank account and not the bank's.

Below you will find an incredible article that we hope will help you save thousands of dollars while providing a better user experience for your clients.

There are literally thousands of merchant services out there, all offering different products and services. Finding your best option can get very confusing, fast. If you are looking for the best credit card processing rates, low fees, and secure payment systems, please read this article. We share solid advice meant to guide you through a complex process.

Pivotal Payments is the first choice for credit card processing by hair salons and spas nationwide.  Pivotal Payments delivers credit card payment solutions and products to help you grow your business. Trusted by over 100,000 happy merchants, Pivotal Payments makes the process of opening a merchant account easy and affordable.

Pivotal Payments easy to set up merchant services allow health and beauty businesses and individual hair stylists to accept all major credit cards and debit cards, even EBT. Our rates and fees are unbeatable. Receive a free credit card reader when you sign up today!

If after reading the information below you are ready to set up your hair salon or spa with the best credit card processing system available, please call Pivotal Payments. Our job is to help you get set up with ease while offering the best rates with enhanced merchant services.

Our health and beauty clients will tell you that we provide incredible service with personal care. Because when your business is profitable, then ours is too. Call 877-462-7486

Credit Card Processing For Your Salon/Spa Made Simple

Originally published on ClienTrak - Tips to Help You Profit by Marc Mataya

Credit and Debit cards are very quickly replacing cash and checks as the preferred method of payment in all types of businesses including hair salons and spas. Their convenience for the business owner and consumer alike result in many benefits including more efficiency, greater customer satisfaction, and increased sales.

But how can you know whether or not you are getting the best value from your credit card processing merchant service or how to compare one agent to another to make the best choice?

If you currently take credit and debit cards, you can quickly determine whether or not your costs are reasonable by calculating your hair salon's Total Cost Percentage for processing services. Take your total monthly Visa and Mastercard credit card processing fees, divide by your total sales, then multiply by 100.

(Total monthly bill / Total sales for the month) x 100 = Total Cost Percentage

This gives you the percentage of sales that are going to credit card processing costs. This formula is very important because it encompasses ALL of your fees collectively. If this amount is more than two percent, you should consider shopping for a better deal.

In the tradition of "trust but verify," this article provides some essential background information about the credit card processing industry as well as some advice on how to compare agents before making your choice on who is best for your hair salon.

You Are Buying a Service

Choosing a credit card processing agent is a lot like choosing an auto mechanic. You are buying a service from the mechanic, but remember that he also has business expenses. He has to pay rent for his shop, buy his tools and supplies and pay other bills.

When you find a good, honest mechanic, it becomes a partnership that benefits both parties: He recommends the right services and options and keeps your car running smoothly. You, in turn, pay for those values, enjoy a safe and reliable car and lower costs in the long run.

In credit card processing, expansive technical resources and networks must work harmoniously to handle transactions and ultimately put money into your checking account. These are some of the costs your agent will be paying in order to handle your account.

Your choice of merchant services has a great deal to do with your total cost, but you are also shopping for reliability, integrity, access to solid information and advice, and someone who will work with you as your business grows and changes to make sure you have the tools you need.

All merchant services start with the same rates and fees from Visa and Mastercard. These are called, "Interchange Rates and Assessment Fees" (see Chart below). The difference in transaction costs between one agent and the next is the difference between the agents' rate structures.

As long as your Total Cost is within an acceptable range, you may choose to pay slightly more for better advice and services such as faster deposits, better equipment, better support, etc., but you should do so consciously.

Pivotal Payments Insights

Pivotal Merchant Insights from Pivotal Payments on Vimeo.

Interchange Rates = Wholesale

Visa and Mastercard are associations of banks that lend money to consumers. They base their rates on risk and to pay for the perks they offer. Rates are set each April and change by plus or minus .02% per year on average. Rates differ by the type of card to which they are applied ("standard no perks," "rewards," corporate, etc.).

Rates also are set by the type of transaction (e.g., riskier "key entered" transactions garner higher costs). You cannot choose which types of cards to accept, but you can control things such as swiping versus manual key entry of card numbers, which can help you manage costs.

The rates structures used by Visa and Mastercard -- Interchange Rates and Assessment Fees -- are publicly available information. The following is a sample of Interchange Rates and how they break down.

Sample Interchange Rates and Assessment Fees

These are just a few examples of card and transaction types and their rates (2006). For a full listing of rates, search

"Downgrade," "partially qualifying" and "non-qualifying" are designations Visa and Mastercard use to indicate riskier transactions for which they charge higher rates, and are terms you may see on your statements.

The rates you are ultimately charged break down as follows:

Authorization fee: You will not see this fee on the Interchange chart. This is a rate charged by your processor at the point of the transaction. Authorization fees (usually about 15 cents) are important when your average charge is small (say, under $10). Otherwise, always go for the lowest transaction rate you can get and don't worry too much about Authorization fees since 15 cents on a $100 charge is nominal.

Interchange Rate: This is the rate Visa and Mastercard charge all agents equally to process the transaction and includes a percentage plus a Settlement Fee (usually around 10 cents per transaction). Assessment Fee: This is an additional fraction of a percent that Visa and Mastercard charge for every transaction. Currently, these fees are at 0.0925% (0.000925) for Visa, and 0.095% for Mastercard. They typically do not change.

Agent's Rate: Also referred to as a markup for the purposes of this article, this is the percentage of each transaction amount the agent adds to cover his services.

Also, there may be a monthly fee from the processor of about $10, and you will need to purchase equipment (card reader, pinpads or terminals) as well.

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