First, how will you be conducting business? Are you generally going to see the customers or do you do business via the Internet or telephone? If business is done face to face and payments are accepted directly at the point-of-sale, you’ll probably want to purchase a credit card machine. However, MOTO or Internet merchants may want to consider an Internet Gateway, which integrate with a website’s shopping cart, or with a Virtual Terminal such as MerchantWare. One advantage to using an Internet Gateway, Virtual terminal, or both, is that these can be used on a computer with a broadband internet connection. If you already have this in place, all you have to buy is the software or a license. Not having to invest in new hardware will save you both money and work-space.

Secondly, for regular Retail merchants, do you have customer demand for more secure, PIN-based transactions? If so, you might want to get a POS terminal with an internal PIN-pad (no additional hardware to purchase, besides the terminal itself), or one that is compatible with an external PIN-pad. If you have a compatible terminal, I would recommend that you get an external PIN pad. With the external option, the PIN-pad is usually already facing the customer so there wouldn’t be a need for you to hand over the entire credit card terminal for the customer to use. This also means that your credit card terminal is more secure and there is less of a chance of the terminal falling into the wrong hands, literally. Using a customer-facing, external PIN pad should also cut down on transaction time.

Credit and Debit transactions aren’t the only electronic payments you can accept as a merchant. Gift Cards could be a great way to strengthen customer loyalty, beef up your customer retention, and broaden your customer base. If you are considering taking these cards, you will need to either make sure that your existing POS solution can work with your Gift Card service provider, or purchase a new solution which will.

However, like I first mentioned, not all terminals are the same and different merchants will require different functions out of their terminals. If you want to learn more about how to accept Gift Cards, Debit, or even simply credit card transactions and want to know what POS solution will best suit your needs, give a call to Merchant Warehouse and allow one of our friendly and knowledgeable Account Representatives to assist you. They can help you figure out what kind of merchant account you will need and what POS Solution will best fit your business. Check back for my next blog which will discuss POS Solution connectivity.

Joseph Fitzgibbons - Senior Support Specialist

There are many types of credit card terminals out there and many times a particular terminal may not be the right stuff for a merchant and their business. Finding the correct POS solution isn’t very hard, as long as the merchant knows what they need to be looking for. I’d like to impart some advice, some general guidelines to search by for the merchants out there who believe it is upgrade time or just need to replace an existing solution.

I’ve been around the POS block long enough for it to become clear to me that there are three important things to be looking for when purchasing POS equipment. I’ve never been in the merchant’s situation of needing to find the best solution for my business, but if I was and had thought about what kind of functionality I needed to get out of my POS equipment, how I would fit this technology into my current business environment in terms of connectivity, and where I could find the best deal on this POS equipment, I would be ahead of the game and would probably be setting myself up for smooth sailing when it comes to accepting all sorts of electronic payments.

To explain a tiny bit more what it is the merchant should consider heavily, they should know
A) The types of payments they want to accept be they Credit, Debit, Gift Cards, or Checks;
B) What kind of telephone or Internet services they have (usually both nowadays, but sometimes there is neither!) which the POS equipment would work on so that transactions can take place; and lastly
C) Where to find the best prices for these solutions.

This does not really paint the entire picture of the landscape a merchant must take a good look at and think on. It’s only exposing the outlines which need to be filled in with accurate information in order for a merchant to make sense out the whole thing and to come up with the best POS equipment for their business. In forthcoming blogs, I will be explaining this further and hopefully helping merchants choose wisely and make informed decisions concerning the technology they’ll use to accept electronic. This should make business for the merchant much easier and hopefully even much more successful in the long term. Stay logged on!

Joseph Fitzgibbons - Senior Support Specialist

Today’s business owners are interested in cash advances for many reasons. Capital can be used to improve or expand the business, pay off debt, advertise, purchase equipment, and make down-payments, just to name a few..

Unlike a loan, a cash advance does not have fixed payments or collateral. Instead, First Funds deducts 20%-25% of the borrower’s daily transactions until the advanced amount is paid in full. Depending on their eligibility, merchants can be approved for a cash advance of up to $150,000.00. In order to qualify the business must be retail/store front, it cannot be out of home, it must have at least 13 months of longevity, and have been processing credit cards for at least 6 months. If the merchant does not yet process through Merchant Warehouse, they will be required to do so before they are funded.

The application is only one page and needs to be submitted along with the four most recent processing statements. The landlord reference or mortgage verification must be listed on the application. In addition, First Funds will be required to conduct merchant interviews and site inspections with all merchants who apply for advances.

Once a merchant is approved, a six page ACH Agreement will be provided for the merchant’s review and signature. This Agreement will disclose the advance and payback amounts. Three days of previous batching (which must be at least 70% of the merchants daily average processing) must also be submitted. Once this information is received, the merchant can be funded as early as the following morning.

Through my experience I find that merchants who applied for First Funds have benefited greatly. Many of them come to realize what a wonderful program this actually is, and decide to renew. Before the advance is paid off, First Funds will contact the merchant and handle the renewal. Renewals are usually funded much faster than the original advance.

The advantages of First Funds are many. There are no personal guarantees required, the payback is completely automatic based on your credit card sales, merchants with bad credit qualify, there isn’t a limited timeframe to pay back the advance, and there are no late, setup or application fees. Those are just to name a few.

If you are interested in making your business the success you dream of, please contact us to get started!

Eve Miceli - Account Manager

However, there is a lack of education for small merchants about data security and compliance issues.  According to Visa and the National Federation of Independent Business (NFIB), 57 percent of small
businesses do not view securing customer data as something that requires formal planning, and 39 percent say they rely on ‘common sense’ to keep their data safe. What these businesses must realize is that common sense is simply not enough to comply with the payment card industry data security standards (PCI DSS), which must be met by any merchant accepting credit card payments. And as more and more of the larger merchants become compliant and the high-profile breaches slow, industry attention will turn to the small merchant.

PCI DSS compliance can be costly; large companies are spending millions on complex technologies to protect cardholder data. But there is good news for small merchants: depending on the method of
processing and transaction volume, compliance can be achieved relatively easily and quite affordably. Here are several steps small businesses can take to work towards the safety and security of customer’s
data and that can also aid in becoming PCI compliant:

- View compliance as a necessity, not an inconvenience. Merchants should view compliance as an opportunity to improve and verify the security of their customers’ card data.

- Educate yourself on PCI. Research the recent data losses and the growing acronym PCI DSS. Additional information can be found at https://www.pcisecuritystandards.org/tech/saq.htm.

- Keep yourself up-to-date on compliance. Requirements and timelines for compliance are continually amended; small businesses need to ensure they are armed with the most up-to-date knowledge and
equipment. This is especially important for those considering opening their own establishment, since new Level 4 merchants must be compliant by October 1, 2008. There are merchant education strategies for those independent merchants seeking reliable direction in addressing PCI DSS.

- Opt for services that ease the burden of PCI compliance. When implementing your POS system; look for solutions that simplify PCI compliance by choosing a solution that encrypts card data at the ‘read
head’ such as the MerchantWARE solution from Merchant Warehouse - to ensure sensitive customer data is never exposed. With no access to consumer credit card data or personal information businesses will automatically meet five of the twelve PCI DSS security standards, including the most intensive and costly.

While adhering to these tips will not guarantee compliance or that a business will not be hacked, they can help forge a path towards better safety and security for customer data, while building a solid foundation for mandatory compliance requirements. And just as important is the invaluable asset of customer trust; putting customers’ minds at ease by informing them their data is safe and secure will only contribute to their ongoing loyalty and keep business growing.

Henry Helgeson - President

While researching merchant account services providers and equipment you must certainly have seen offers for free terminal deals. But before you walk into a trap, ask yourself the following questions:

What is the contract or termination fee? Always ask for the schedule of fees and the program guide to make sure that neither the provider nor the back end processor has a contract or termination fee. When you’re locked into a contract, you might be paying for that “free” credit card terminal with increased rates every three months or a surprise “added” annual fee. Merchant Warehouse has no contract or termination fee, which means that A) We have every incentive to keep you happy and processing with us for a very long time, and B) We can’t arbitrarily raise our rates or provide lousy customer support, since it is so easy for you to leave us.

What kind of terminal are they giving me for “free”?  Our site is a good point of reference for you. Since we buy all of our equipment wholesale, we can offer credit card terminals at guaranteed lowest prices. So, if you are a new business being promised a “free” terminal that is worth hundreds of dollars on our website, that should raise a red flag. If you own a fine dining establishment, would you run a promotion where you’re giving away free lobster tail and filet mignon?

What happens if the terminal breaks? If you read the terms and conditions, you may find a hidden clause that states if the terminal breaks you have to wait weeks while it’s being repaired. Merchant Warehouse’s free terminal program includes overnight replacement insurance. If you drop the terminal, spill something on it, or it’s struck by lightning, we overnight you a replacement, no questions asked.

What is the condition of the equipment you are purchasing?
Is it new or used? Merchant Warehouse only sends out new units for our free terminal program that are programmed and tested in house before it gets to your door.

So remember, if a deal seems too good to be true, it is. Make sure you are getting the best package deal, because when you think about it, if you walk into a car dealership and try to get something for free or with no strings attached, you’re likely to end up with a piece of junk that breaks down on the highway.

Shannon Andrade - Account Executive

When a merchant starts “shopping” for credit card processing, they are drawn to a company’s site by numbers.  Whether it’s a discount rate or a terminal price, the merchant will click on the lowest number they see on their Google search page. What the merchant doesn’t know is that, 9 times out of 10, the numbers they see are most definitely not what they are going to get.

The notion of “what you see is what you get” does not apply to the merchant service industry in most cases. So when a merchant tells me flat out to give them my “best rate” I try to back them up about 10 paces and explain to them that a merchant account is made up of many more elements than one single rate, and it is crucial that they look at each and every rate and fee for all the companies they are researching.  I tell them they must take the time to do a TRUE “apples to apples” comparison to in order to truly assess which company has the best overall deal.

Chances are good that the company who offered them a 1.18% has a $25 monthly minimum and a 3 year contract with a $200 early termination fee.  It frustrates me to see how many merchants take these “low rate” numbers at face value and end up getting burned. 

In summation, I encourage merchants to “shop around” as long as they are doing so from an educated place where they ARE looking at the whole package and are not staying fixed on one rate, using that as their basis for comparison between companies.

Erin Leddy - Account Executive

Merchant Warehouse’s new credit card processing cost reduction tool, the BINsmart Interchange Manager^TM for MerchantWARE, was unveiled back in July, and the response has been overwhelming. Various trade publications covered the release, and both Merchant Warehouse and MerchantWARE have been featured in articles related to electronic payment systems and credit card fraud issues. Here is some of what they had to say:

ISO&Agent Weekly
On July 24, 2008, ISO&Agent Weekly announced the release of Merchant Warehouse’s BINsmart Interchange Manager, the latest addition to the MerchantWARE payment gateway.

BINsmart determines whether a card used is credit, debit, or a corporate card by reading the first 6 digits (called the Bank Identification Number, or “BIN”). 

“If the system identifies the card as a debit card, it will send back a response to the point of sale system to prompt for a PIN number”, said Henry Helgeson, President and Co-CEO of Merchant Warehouse.

BINsmart complies with the Payment Card Industry Data Security Standard for payment applications because it does not store credit card number.  BINsmart is also free to developers that add Merchant Warehouse’s payment gateway. 

Merchants could benefit from lower interchange fees for debit transactions as their system can identify card type.

Cardline
On July 25, 2008, cardline announced the release of Merchant Warehouse’s BINsmart Interchange Manager. 

Currently working with integrated point of sale systems, BINsmart enables systems to prompt for a PIN number when a card is determined as ‘debit’. 
 
BINsmart complies with the Payment Card Industry Data Security Standard for payment applications because it does not store credit card number.  BINsmart is also free to developers that add Merchant Warehouse’s payment gateway. 

Merchants could benefit from lower interchange fees for debit transactions as their system can identify card type.

Transaction World
In the August, 2008 issue of Transaction World, Jim Romeo looks into the effects of electronic payment systems and interchange fees on the current state of the U.S. economy.  Henry Helgeson, President and Co-CEO of Merchant Warehouse, discusses the potential affect of the Credit Card Fair Fee Act of 2008 and how important it is to capture the attention of legislators and educate them on the how interchange fees are established.

Beverage Media Group
In the August, 2008 edition of Beverage Media Group, Ian Griffith discusses the rise of credit card fraud over the past three years in the U.S. and how compliance with PCI-DSS (Payment Card Industry Data Security Standard) can help.  PCI DSS represents a methodology with 12 requirements to help increase card data protection.

Although very few wine stores process over 6 million credit card transactions per year, stores below this threshold qualify for conducting a self-assessment questionnaire along with a quarterly network scan conducted by a third party. 

Henry Helgeson discusses a new product released by Merchant Warehouse called “MerchantWARE”, which encrypts card information at the point of swipe.

RIS – Retail Info Systems News
On August 7, 2008, RIS Online announced that Merchant Warehouse released a new tool to help small and mid-sized merchants reduce their overall processing costs. 

The solution, called the BINsmart Interchange Manager, allows retailers to identify card type (credit, debit, or corporate card) at the swipe by reading the first 6 digits (called the Bank Identification Number, or “BIN”). 

Some merchants call to cancel their merchant accounts because they believe they are offered better rates from other processors.  They tend to jump to conclusions and want to cancel, not realizing we can match or beat anyone else’s credit card processing costs. More importantly they aren’t aware of the risks they can face by switching to another processor.

Once a merchant has a schedule of fees that they are being offered by another processor, he/she can simply fax it to us and we will gladly evaluate to determine how we can help accommodate the merchant.  In many instances we find many undisclosed “hidden fees.” These fees could include a contract with a costly early termination fee.

For example, in one particular case, a merchant who I had previously helped on a number of occasions called me. She wanted to inform me that she had canceled her merchant account with us a few months prior. She said the client service representative she spoke with recommended that we look over the competitor’s contract and fees. However, she wasn’t interested and wanted to cancel immediately. She admitted that switching processors was a huge mistake. Although some of her rates were slightly lower, the customer service was inefficient and not helpful whatsoever. She wanted to revert to us, but was locked into a contract which included a $395.00 early termination fee which she was never clearly made aware of. It was mixed in with a cluster of small print jargon on the application. We were able to offset a portion of her cancellation fee which made it possible for her to return to Merchant Warehouse.

In addition to unhelpful customer service and hidden fees, not getting funded on time, annual fees, and unexpected rate increases are other problems that an uninformed merchant can encounter after switching processors.

Eve Miceli - Account Manager

“We are honored to be included in the Inc. 5000 list among some of the top companies in the United States,” said Henry Helgeson, President and Co-CEO of Merchant Warehouse. “Celebrating our tenth year in business, we have seen tremendous growth, and that success is in direct correlation with our dedicated employees and the loyalty of our customer base.”

“Our second annual Inc. 5000 continues the most ambitious project in business journalism,” said Inc. 5000 Project Manager Jim Melloan. “The Inc. 5000 gives an unrivalled portrait of young, underreported companies across all industries doing fascinating things with cutting-edge business models, as well as older companies that are still showing impressive growth.”

With more than 40,000 merchant customers and ten years experience, Merchant Warehouse has set the standard in the credit card processing industry by providing credit card processing software, POS equipment, and merchant services ethically and at a reasonable price.

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Throughout my 2 years working in this industry, I have noticed a few common threads that have remained unchanged over the years: Merchants do not WANT to accept credit cards, and furthermore, don’t have TIME to spend researching processing companies.  They want a quick fix and easy fix.  But I have seen this industry change more rapidly in the past 3 years than any other industry, and merchants are having a hard time keeping up.  

By the time a merchant calls in to Merchant Warehouse, chances are he/she has spoken with 2-3 credit card processing companies and has been told 2-3 completely different things.  Most of the time, it seems like competitors will throw a lot of numbers and “deals” at the merchant without backing any of it up with facts or statistics.  These competitors only know how to “sell” but know nothing of the merchant account industry itself.  By the time the merchant gets to me, he/she is more scared to accept credit cards than ever before.

On a typical incoming sales call, the merchant arrives already frustrated, confused, and extremely guarded.  Luckily, when I started working for Merchant Warehouse, I spent 8 full weeks in training before I ever touched a phone, and every Friday morning the Sales Team gathers for a weekly meeting with the Executives to discuss industry changes. – This IS an extremely competitive industry, and as Merchant Warehouse reps, we are required to know what we are selling, and who we are selling to.  

I am able to educate the merchants who come to me knowing nothing about any of this “credit card stuff” and I have found that there are very few questions I can’t answer – even for the most educated merchant!  One would be surprised at how many merchants I’ve talked to who say, “Oh, I never knew THAT” “Thank you for telling me that; the other guy I talked to never brought that up.”  “No, he didn’t explain this to me; I totally get it now!”  The call ends with a happy, educated merchant who, 99% of the time will come back and set their account up with me.  

The best part about feeling knowledgeable is that I get to relax when I’m on the phone with a merchant.  Then they, in turn, also feel relaxed, and pretty soon we’re debating about who’s going to clinch the division title this year…  (That’s baseball for you non-sports fans!)

Erin Leddy - Account Executive