Flat Rate Payment Processing: Understanding the Benefits

If you are a first-time or small business owner, then you may have heard of flat-rate credit card processing. Every business needs a provider for credit card processing, as it is one of the most important aspects of any business--the ability to accept payments. However, choosing a provider and a fee structure can be a challenge that takes time, energy, and research. If you’re going to succeed, then you need to be familiar with every type of processing service and why they might be suitable for you. One of the most popular services purchased by small businesses when it comes to credit card pressing is flat-rate credit card processing. 

Flat-rate credit card processing has many benefits, but it's not the right situation for every business. This brief analysis of flat-rate credit card processing will give you some insight that helps you decide whether flat-rate credit card processing is the right option for you, or if it's a bad choice for your specific business.

Credit card processing isn’t always the easiest concept or industry to understand

As a business owner, you are already aware of some of the struggles that you can experience when trying to determine a credit card processing provider. It is one of the most difficult things to do as a business owner, especially if you are trying to estimate the cost of accepting credit cards using a merchant services provider. Determining these costs can be difficult, which is why some business owners are drawn to a flat-rate processing model where the pricing is easier to understand.

However, these decisions depend on so many factors that it becomes a time-consuming task to determine which pricing model is best for you. To make it easier, this article will serve as a knowledge base and guide to helping you understand the factors that go into this decision and what concepts you need to understand.

Definition of flat-rate credit card processing

The first important concept of credit card processing to know is what exactly flat-rate credit card processing is. If you’re going to determine if it is the right choice for you, then knowing what it entails is the first and most important step. With an understanding of what flat-rate credit card processing is, you’ll be well on your way to understanding it at a deep enough level to decide whether it is the right choice for you. 

Credit card processing isn’t free. It costs the merchant a fee to implement and accept payment processing solutions. The variable here is what the cost is. Just like in any purchase, there are varying costs from different providers. Though consumers don’t consider it, it is the reality of being a business owner. In addition to trying to find the lowest fee, merchants also face the possibility that credit card processing fees will vary within the credit processing provider that they choose. 

One of the most significant and common reasons for credit card processing fees to fluctuate is the various fees charged by Visa, Mastercard, and other suppliers for using the card. In addition, there are fees charged by the issuing bank for the transaction and there are a couple more mouths to feed along the way. There are hundreds of services that are involved in this process and each one takes a different sized bite. For this reason, credit card processing fees can often fluctuate and have business owners confused about what they are actually paying to process credit card transactions.

To simplify things and make it easier for the merchant to understand, credit card processing companies have begun to offer flat-rate credit card processing fees. With flat-rate credit card processing fees, merchants are more able to predict exactly what the cost of accepting credit cards will be and forecast that into their profits and margin calculations. It comes with many benefits, but it’s not right for every business.

Benefits of Flat-Price Processing

As you can imagine, there are many benefits to flat-rate processing and that is why it is so commonly used by businesses that are seeking simplicity in their processing arrangements. When you have flat-price processing, there are a few aspects to love about your credit card processing agreement.

Predictability

The first benefit of using flat-rate credit card processing is being able to have a predictable credit card processing fee each month. With predictability in the rates that you are charged to process credit card transactions, you can not only plan your expenses better, but you can also price goods and services better to provide you with a more consistent margin. 

When you know what your processing rate is going to be, the need to fluctuate your item pricing will disappear. You can plan ahead and be sure of what you are going to be charged to process credit card transactions.

Flexibility

When you have a flat-rate processing plan, another benefit that you will be entitled to is the flexibility that comes with these processing plans. With flat-rate credit card processing plans, you often don’t have to get locked into long-term commitments that hinder your flexibility and make it difficult to plan ahead. For small businesses looking for short-term credit card processing or to lessen the long-term overhead for their business, this is the ideal situation.

Flexibility is also a benefit to any business that might be considered high-risk or in general need of agility due to possible changes in the business model, revenue, and other aspects affecting their business.

Simplicity

When you work with a flat-rate credit card processing contract, one of the most important benefits is the simplicity of the contract. As we touched on earlier, traditional credit card processing agreements will often feature clauses, charges, and fees that you don't even have access to seeing the details on. For this reason, in those arrangements, you can never tell exactly what your credit card processing fee will end up being.

However, with a flat-rate processing plan, you can always understand what the fees are and exactly how they impact your business. You can plan to include enough margin for your processing fees and make it easier to understand the implications of your credit card processing agreement. 

Who is a good candidate for flat-rate processing?

If you are considering flat-rate processing for your business, you probably want to know a bit more information about who is a good candidate for flat-rate processing and which businesses should pursue flat-rate processing for their processing needs. It is very easy to identify merchants that are good fits for flat-rate processing because of the straightforward nature of flat-rate processing. 

Startups

Startups are the ideal businesses for flat-rate processing because they usually need to have less overhead and a shorter contract. Startups are often young and unstable, so having a processor that is flexible in the terms is ideal. Startups also typically have a lower volume of transactions. Many credit card processing companies have solutions that are specifically geared towards the needs of startups and young companies. 

Small Businesses

Small and local businesses are another frequent customer of flat-rate processing solutions. This is because small and local businesses typically have a much lower volume of transactions than larger companies and they are unable to attain better rates. In addition, small businesses are slightly more unstable and higher risk than other companies and don’t have the leverage to get favorable contracts with other processing solutions. 

High-Risk Businesses

Businesses that are higher risk industries also tend to use flat-rate processing because they are subject to riskier transactions that could lead to increased fees by processing companies. If they are able to get an account with a flat-rate processor, then high-risk businesses typically take that opportunity because it is a favorable situation for them. 

Doing better than flat-rate processing

For some, flat-rate processing simply isn’t a great option. This leaves many wondering if it’s possible to get a better deal than flat-rate processing. It’s true, there are some downsides to flat-rate processing and that is the reason that some choose to pursue other options. It is possible to get a better deal than flat-rate processing has to offer, but there are certain conditions that you have to meet. 

The first condition that you have to meet if you want to get a better deal on your credit card processing than what flat-rate processing has to offer is that you have to be able to do a high volume of transactions. The higher the volume, the better deal you are going to get on your processing. 

Another condition that you will have to meet if you are going to get a better rate than what most flat-rate processing solutions have to offer is you will most likely have to sign a longer-term contract for your processing needs. This means less flexibility, but it is possible that you will get a better rate, though it will be dynamic and subject to change. 

If you are a business that cannot get flat-rate processing or you do a high volume of transactions for an established and long-lasting business, then you can possibly get a better deal by going with a solution other than flat-rate processing. 

What's so great about the PA PAX E700 Smart POS+? Well, just about everything, but there are some main features that make it perfect for a business that's just getting started or that needs to finally get organized: 

Easy to Use

Not a computer wiz? Why would you need to be? You're in the café business after all! If tech support is something you simply don't want to deal with (or pay an arm and a leg for), then this is the kind of POS you want at your restaurant. It is extremely easy to set up and includes a wizard that will do all of the heavy lifting and help you to get started. Updating can also be a hassle with most modern operating systems, but you won't have to worry about that with the PayAnywhere Smart POS+. It takes care of the updates automatically so you don't have to fiddle with anything to get the latest security features installed. 

Customizable

Your business is unique, so the interface on your point of sale system should be, too. Luckily, the software that runs on these machines is very modular and you can add or remove elements from the screen easily at your leisure. This means that if you have a very simple menu, you don't have to suffer from an overly-busy screen if you don't want to. It also means that you can use trial and error to determine what kind of interface is most efficient for you and your employees. 

Advanced Technology 

You want the most advanced software for your store, and thats exactly what this POS is running. The system is cloud-based, so you'll have the convenience of being able to keep an eye on sales and other figures whether you're at your coffee house location or need to step out to address your latest emergency. If you lose Internet access for any reason, though, don't worry: this system is still capable of storing information locally, and it will sync with the cloud as soon as you're re-connected, so you'll have the best of both worlds. This POS is also capable of taking several different payment methods, including cash, credit card, and Apple Pay, so you'll never have to lose a sale simply due to an inability to take your customer's money. 

Great Hardware Overall

This is a very modern, very sleek and well-designed POS system that you'll be proud to have sitting on your counter-top. Unlike the old, bulky registers of yore, this system is thin and easily portable, and uses and extremely intuitive touch interface. The screen even twists around to face your customer so that they can sign off during a credit transaction, and it's just as easy to read and comprehend for them as it is for your employees as it mirrors the mobile interfaces that most of your customers will already be used to. The screen is just about the size of a large tablet at over 13”, so it's certainly big enough to to comfortably use, but not so big that it takes over your counter space. Don't worry about keeping your customers waiting, either, since this system is really fast. It uses a flash storage system rather than the old style of hard drive, so all of your orders can be taken and stored quickly. 

Great Support

As mentioned, the interface is extremely easy to use, but as with any kind of technology things can certainly go wrong. If you find that you need tech support, the company will provide it 24-hours a day, 7 days a week, so you never have to worry about being caught in a tight spot because they are always there to help. Another nice aspect of their support is that if your equipment ever actually physically breaks, they will replace it for you for free. 

Low Cost 

Shaw Merchant Group offers a few different solutions, but the PayAnywhere Smart POS+  is the best value. It's one of their cheapest, costing only a small monthly fee (currently less than 40 dollars) to serve a small company with a few employees. Best of all, there is no upfront cost. For just a bit of pocket change practically, you can be up and running immediately, using some of the most advanced POS technology. There are many costs to not organizing your business properly, and considering how much this POS could save you in terms of time and labor, it will pay for itself many times over. So if you're looking for a POS that can serve you and your customers at your coffee shop, the PayAnywhere Smart POS+ is certainly one of the simplest, easiest, and cheapest options out there.

For years, Shaw Merchant Group has been the preferred partner of those that want more out of their payment processing experience. Shaw Merchant Group is a merchant services company that offers a unique and comprehensive suite of solutions to help business partners around the globe. With our distinguished suite of products and services, attentive customer service prioritization, and a world-class sales staff, Shaw Merchant Group is truly the ideal partner of merchants everywhere and in every industry.

Our Products and Solutions

To provide our merchants with the very best when it comes to merchant services, we feature a wide range of products and solutions that enable us to serve merchants from any industry.

Processing

Processing is the backbone of any business, and without a reliable partner to provide processing for your business, no transactions can happen. We are happy to provide processing services to our merchants all around the world and make it easier for any business ranging from small to large to accept payments and facilitate day-to-day transactions.

Ecommerce

Though in-person payments are not yet a thing of the past, ecommerce capabilities are growing by the day. While ecommerce grows in market share, you can’t afford to miss out on the benefits of working with a reliable partner to facilitate ecommerce payments. We collaborate with multiple platforms to deliver a full-service ecommerce payments package for our clients.

Back-End Solutions

Every business depends on back-end solutions to enable the front-end operations to work. We offer a comprehensive suite of back-end solutions that allow you to focus on what is really important--growing your business. Leave the back-end solutions to us to achieve high-quality, robust solutions that work for your business.

Mobile Payments

Mobile payments are becoming more relevant and necessary with each day. To facilitate these new kinds of payments, you need a partner that you can trust and one that has years of experience adapting to change. Shaw Merchant Group has been that partner for so many clients and we are ready to be that partner for you, as well.

Customized Solutions

Need something that you haven’t seen listed yet? We offer a suite of customized solutions that are sure to help you succeed in your goals. We work with companies on a daily basis to create solutions that are specifically designed for their needs and we’re ready to do it for our business too.

Why Choose Us?

Shaw Merchant Group has been the preferred partner of hundreds of clients for many years. Here is why they continue to come back to us time and again for their merchant services needs.

Experience

When it comes to experience, we are unmatched in the industry. We have years of experience facilitating credit card payments for our clients and guiding them through the complicated world of merchant services. If you are looking for a partner that can not only serve in a business sense, but also be a knowledge center for your business to guide you through the services you need, then we are the right choice for you.

Product Suite

In our years of experience we have also, several times, expanded our products and services offerings to make it easier for your business to get the services that it needs to thrive and succeed. We offer an expansive product suite that is scalable and customizable to address any need that your business might have when it comes to merchant services. Explore our products and services today to learn more about how we can help you.

Customer Service

At Shaw Merchant Group, we will always prioritize customer service. It is one of the most important pillars of our business and the main reason that so many of our clients come back to see us time and again. When you work with Shaw Merchant Group, you’ll be gaining the benefit of a teammate on your side to help address any issue that might arise.

Affordability 

With some of the most affordable and competitive rates in the industry, we are the right partner for any business on a budget. We'll help you simultaneously expand your business and reduce your processing costs to give you a distinct edge over your competition. Work with us to discover the benefits of affordable, fast, and reliable processing and what they can do for your business.