How necessary is debit/credit card processing?

[PSITuning]

Previously we've always taken only cash. Debit card machines are about $100/mo plus about $500 for setup and you have to pay a per transaction fee plus a percentage off credit cards. For this reason I've always resisted getting a machine. Most of my customers know this and arrive with cash. Since I'm moving more into service and smaller jobs I am wondering how most people like to pay for their automotive work?

-Michael

[Nader_D]

cash, credit card, and debit

in that order

[CRXZC]

Cash...for cash jobs...

Credit Card for non-cash jobs.

I would go with Cash and CC - and instead of getting a machine - do it the old fashion telephone way.. you'd probably only get a couple a day Max anyways.

Check out ScotiaBank - Paymentech - I think they are the cheapest. There's an Ottawa Businesses Association (I can't remember what they damn thing is called) - and if you join for like $50/year or whatever, you get a discount on Debit/CC through Paymentech. Not sure if it's the same in Quebec though.

[snowstang00]

myself, debit, credit, then cash in that order.

[G-PWR]

not that I don't trust you particularly, but whenever I am buying something of a large value, I like there to be some record of it; not just a written receipt. Debit and CC transactions are recorded and so everyone can rest easy; cash transactions are my least favorite form of payment; not only am I expected to cary large amounts of untraceable cash on me, which could be misplaced or stolen, but the aforementioned is also true.

Get a machine, I personally think it's mandatory for a business.

[NoLimits]

Id say 75% of my transactions are debit, then visa and mastercard, stay away from amex.
Cost of business. (another)

[Spd-Kilz]

My order is credit, cash, then debit. I usually have no problem paying cash...as long as the seller makes this clear upfront. I hate showing up unexpected to hear "Oh we only take cash". I only carry $100-$200 in cash so if it was a big job that would suck.

Found out the hard way from NL about not taking AMEX :lol:

[civicgsr93]

I hate debit.

cash is for cash jobs, or little bills. Anything over $100 is cc for me.

[PSITuning]

I do end up taking a lot of cash from people because they feel better about not paying the tax but that's just in the accounting. Since I don't make enough to pay myself I can't just shovel it into my pocket. All that happens is that the "cash" bill is then reverse calculated to arrive at a taxless sub-total. For this reason cash or debit or credit doesn't matter at all to me - it all gets swallowed into this big thing we call overhead anyway.

Doing the CC processing over the phone works out to be more expensive in the long run since they take a larger percentage since a card not present transaction is more likely to cause a chargeback. The difference is 1%. That doesn't sound like a lot but the average properly done turbo kit is $5k. One transaction the difference would pay 1/2 of the monthly fee.

In any event I am in the process of making some big changes for next year and like to hear what people are used to. Since I obviously don't take my car to another "garage" I don't often see what the others are doing in my industry. I only hear the horror stories and they seldom present an objective overview.

-Michael

[DVS Talon]

I pay debt and if they don't have it I'd like them to tell me where the closest Debt machine or bank is so I can go and take cash out.

Big repairs/parts I pay CC.

[405hp]

My MasterCard / AMEX give me many Air Miles which I use to go on vacation with.

I also don't have to pay my bill until a certain time anywhere between 2-6 weeks away, so more money sits in my savings and accumulates interest.

Why would I want to pay any other way? To have debit card fees for going over the allowed transaction limit? To pay $1.50-2.50 for using a 3rd party ATM machine, then another $1.50 to my bank on top of that? To have a bulky wallet to carry around with lots of untraceable, stealable money?

Noooo thanks, I'll put this on my MasterCard, Sir.

[97gst]

Visa/MC is pretty essential for any retail company. Suddenly you are 'legitimate' in the eyes of older folk and not just a 'cash job only' shop, even if you aren't shaddy. It gives you instant credibility, deserved or not.

It shouldn't cost you anything to setup and account, and yes you'll lose 2.5% but it opens way more doors than you'd think. You can do the old fashion sliders thing if you don't want to pay the $35/month for the POS machine. Increase your prices 2.5% across the board then offer a cash discount of 2.5%. So those that use the credit cards pay for the cost of it, and the others get a bonus for paying cash and saving you the overhead costs of the banking fees.

Off the street customers expect it, and you can bill them more than word of mouth referrals. Plus broke customers will be vastly more inclined to "just charge it" and spend more. Especially those that live paycheque to paycheque.

Debit is a no brainer if you already are getting the POS for the VISA/MC.

[SHOmethemoney]

My MasterCard / AMEX give me many Air Miles which I use to go on vacation with.

I also don't have to pay my bill until a certain time anywhere between 2-6 weeks away, so more money sits in my savings and accumulates interest.

Why would I want to pay any other way? To have debit card fees for going over the allowed transaction limit? To pay $1.50-2.50 for using a 3rd party ATM machine, then another $1.50 to my bank on top of that? To have a bulky wallet to carry around with lots of untraceable, stealable money?

Noooo thanks, I'll put this on my MasterCard, Sir.

:stupid:

I always say you don't get points for using cash. MBNA & Aeroplan are footing most of the bill for my next trip to Hawaii. I've spent over $30,000 this year on business travel alone. And the best part is that I use the money I get from my travel claims and pay off my line of credit with it. Then use the LOC to pay off the credit card when it's due. Saves at least $15 a month doing that.

[PSITuning]

Well... I've decided to suck it up and pay the $586.50 for a machine. I guess it's just one of the costs of doing business... Should be here in about 2 weeks.

-Michael

[Maximus]

Good choice...

[Eviltwin]

you've run a legit tunning company without a debit/credit card account, be it moneris or whatever is cheap these days?

everything was cash only???

I woulda loved to be your accountant come tax time:rolleyes:


I KEEED I KEEEEED!! it's all love in here.

[smokumchevy]

Isn't paypal's "virtual terminal" the same thing without the expensive outlay of money for equipment ??

Just curious as I ran across that option on the paypal site while trying to set something up myself.

I am by no means savy to e-commerce and its workings !!!

My head hurts ......

[hackish]

you've run a legit tunning company without a debit/credit card account, be it moneris or whatever is cheap these days?

everything was cash only???

I woulda loved to be your accountant come tax time:rolleyes:


I KEEED I KEEEEED!! it's all love in here.

It's actually pretty simple. How do you think Tim Horton's does it? I never had a problem with cheque fraud or credit card fraud. I had someone try to pass a fistfull of phony 20's to me once but I handed them back and said bring me real money. He got really pissed off but later one of his friends asked me how I figured it out so quick. Simple, counterfeit doesn't feel right...

What people don't understand about taking cash is that you have to either have enough that sliding money in your pocket doesn't show up. For me there never was any huge excess so any money that came in has to be declared since it goes to pay the bills, doesn't go in my pocket except on it's way to the bank.

I'm sure any business owner will tell you it's not all roses. Be prepared to work your ass off with no pay for 3-5 years. Then you may continue and hope to take a little money for a paycheque or you'll go bankrupt and then spend years working off the debts you acrued setting up the business.

-Michael

[hackish]

Isn't paypal's "virtual terminal" the same thing without the expensive outlay of money for equipment ??

Just curious as I ran across that option on the paypal site while trying to set something up myself.

I am by no means savy to e-commerce and its workings !!!

Virtual terminal is USA only and paypal takes 3%. It also takes a long time to get your money.

-Michael

[smokumchevy]

Really ?? Thats not how I read it at all.......

https://www.paypal.com/ca/cgi-bin/webscr?cmd=_display-vt-fees-outside

https://www.paypal.com/ca/cgi-bin/webscr?cmd=_vt_hub-outside

[hackish]

Ah you're right, they have introduced it for Canada too now. 3.1% + $0.30 is expensive. For many businesses 3% is their net profit after all the bills are paid.

-Michael

[Eviltwin]

Tim Hortons has a business practice to quickly serve their clients as fast as possible, with what I would suspect their average sale is less than $3 and typically no more than $10.

They have an' even flow of customers running in and out their doors, sometimes 24/7.

They have hundreds of franchised businesses throughout the country, and some in the northern U.S. aswell.

One would understand why Timmy Hoho's won't implement a debit card machine for $1.45-$3 transactions during the morning rush, as it would slow down their business and jam stores.
The however, DO have MasterCard now.

So, now that it's put into perspective as to how we cannot compare a Fast Food Coffee Chain with an' Automotive Tunning Specialist...

still, I fail to understand how everything is legit ANDcash only where the books are perfectly balanced.

The Tax Man must just skip your house every year me suspects:mrgreen:

[hackish]

On every piece of money it says this note is legal tender. There is nothing illegitimate about accepting cash. Unfortunately in the automotive trade people equate cash to an under the table not on the books deal. Truth be told there isn't enough money in the business to be able to take the cash under the table.

When you pay the bills you have to be able to show how the money arrived. When you show how the money arrived it has to be on the books and taxes have to be paid.

Hypothetically if a business brings in $10k in revenue then generally their expenses will be about $9500 and that's on a good day. So if you did $500 in cash deals not on the books you'd still have to explain how you got paid yourself.

I remember once Mike @ NoLimits explained this sort of stuff to me and I thought maybe he was exaggerating a little about how tough it is to make enough to meet the poverty line. Fast forward a few years and I've seen it's true, every word of it.

If you want to get rich as a businessman you need a huge amount of money and a huge amount of cash flow. One of my friends does well for himself - pays himself about $100k per year. Guess what? Sales are about $6m per year.

In any event I should have my debit card machine before Christmas.

-Michael

[T5shortblock]

My MasterCard / AMEX give me many Air Miles which I use to go on vacation with.

I also don't have to pay my bill until a certain time anywhere between 2-6 weeks away, so more money sits in my savings and accumulates interest.

Why would I want to pay any other way? To have debit card fees for going over the allowed transaction limit? To pay $1.50-2.50 for using a 3rd party ATM machine, then another $1.50 to my bank on top of that? To have a bulky wallet to carry around with lots of untraceable, stealable money?

Noooo thanks, I'll put this on my MasterCard, Sir.

same here, except I go with visa, fuck le cash sti!