There are a multitude of everyday problems facing any auto body repair and mechanics shop and many other businesses in the automotive industry. Finding spare parts for older model cars, studying the advancements in the newest models being built, the quandary of all the new connected cars, like Tesla and GM’s Onstar, and the affect it may have on the small auto body or repair shop, employee turnover…
Accepting payments and how you are accepting payments should not be one of them.
The last thing you need to worry about is how you are going to accept payments for your work and how much it will cut into your bottom line. But At the end of the day Customer payment is number one. Payment from their customers is one of the biggest concerns for many a small auto body repair or mechanic shop. Repair shops regularly pay up front for the parts they order, paint and the wages for their laborer for the work and must carry the balance until they are paid by the customer.
Many auto body and auto mechanic shops just can’t afford to finance their customers, that’s just not the business they are in, and they shouldn’t have to.
Auto body and repair shops accept credit cards instead of insurance reimbursement.
These days generally insurance companies reimburse their customer instead of paying for a claim directly to the repair shop. This is actually better for the repair shop in the long run. In the interest of cost containment insurance companies over the years have tried to tell shops what they can repair, how much it should cost and how they should fix something. Insurance companies put a cap on the labor rate they are willing to reimburse the repair shop for a claim, often won’t reimburse storage fees and force shops to take shortcuts in order to fit the repair in the confines of the reimbursement allowed.
Since insurance companies are the ones calling the shots and they are also the ones 90% of the time making the payments it is in the best interest for the success of the shop to make sure those payments are working to you and your customers advantage.
At the the end of the day it is much more advantageous to accept payment, commonly by credit card, from the customer and let them worry about the amount the insurance company is going to reimburse them for the claim.
One of the most obvious ways to ensure success in any business is to try to keep overhead as low as possible. But that is not always easy. Generally auto repair claims come with a larger than average ticket size. Even a minor incident can cost upwards of several thousand dollars to repair. That translates into some significant credit card fees for these types of businesses.
There are ways that auto body/repair shops can keep credit card and other costs associated with accepting payments low to start with.
Diversify acceptance of payments by offering multiple payment options. Take advantage of our pin-based debit solution. Pin-based debit transactions have much lower fees associated with processing than credit cards. Some people still really like to write checks so accepting checks as payment is still very much a thing. Of course, we recommend that you do not do so without the use of a check guarantee service. This will protect you from the unfortunate experience of taking a bad check as well as the time and costs that undoubtedly come along with chasing after the customer.
But, inevitably, there will be a situation where the customer is just going to want to pay with their credit card. If they are paying for the repair themselves, if they don’t have that kind of money at their disposal, if they are waiting for the insurance company to reimburse them, most likely when they are just looking to gain their bonus miles.
Because insurance companies now reimburse the client when a claim is made instead of paying directly to the repair shop people have found a way to use that to their advantage. Paying you with their credit card allows them to accrue air miles or cash bonuses. The problem is these rewards cards cost the merchant more to accept than regular credit cards. Depending on your industry the average cost for a consumer card is 1.43-1.56% & $0.10/Transaction versus your average rewards cards at 2.1 – 2.77% and $0.10/transaction. So it costs you money so that your customer can get their cash back bonuses.
Accept credit cards at your auto body shop without paying for your clients next vacation.
How would it feel to take the most convenient form of payment, reduce the incidence of bounce checks, experience quick funding into your account and do it all for almost free? Let me introduce you to the cash discount program. Implementing this program with your merchant account to accept credit cards allows you to offset or even eliminate the processing fees that come with processing credit card transactions.
This program was designed to allow the merchant to offer a cash discount to those who are paying cash for their work while also offsetting the fees for all of the credit card transactions. This way the customer knows right up front that all prices reflect a discount when paying with cash and that if they choose to pay with a credit card they will not be taking advantage of the discount.
The regulations allow you to set the program up to offset anywhere from 1% to a max of 4% of the transactions being processed. As a business owner you will be able to decide exactly what fits into your business model.
Every business is different, we will work with you to figure out what strategy will best fit into your business plan, and then proceed to perform all of the necessary implementation so that you are up and running in no time.
Once we have notified the card networks, VIsa/MasterCard etc., that you will be implementing the program we will make sure you have all of the correct signage and provide you with your terminal. There is no need for you to worry about any calculations since your terminal will automatically be pre-programmed with the correct information needed to calculate,process the service fee and correctly print the receipt as per the regulations. Of course, you will still be able to accept all types of credit cards through state of the art terminals that are EMV compatible, PCI-DSS compliant and equipped with on screen signature capture. Our program abides by all guidelines set by the card issuing companies.
Cancel anytime- if you for some reason want to go back to traditional processing we can switch back at any time.
Your cash discount enabled merchant account will still come with our diamond level customer care and support. You will enjoy a merchant account that comes with a lifetime rate guarantee (yes this is still important), simplified billing and statements you can understand, back office access including dynamic reporting tools and free paper supplies.
Just because you are not absorbing the costs of accepting credit cards doesn’t mean it is not important to make sure you are getting the most competitive rates you deserve. It is not only easier, but muchmore fair to your customers, to offset the fees when you have the most competitive rates. Operate with complete transparency-all fees and pricing being clear to both you, the merchant, and your customer right off the bat.
The cash discount program is truly an efficient way to offset some of the costs of doing business in the age of credit and to have better control over your bottom line.
This program is just one example of the cutting edge tools Bankcard Brokers offers to add to the health of our client’s business success. Looking for ways to expand operations, upgrade equipment, or just increase sales? A Merchant Cash Advance can provide you with a reliable source of working capital without the bank imposed red tape or the risk of putting up collateral.
Our ETA-Certified Payments Professionals, who are committed to professionalism and personal integrity, strive to exceed our clients expectations by providing affordable merchant services with complete transparency and world class customer service. Just give us a call today to find out how our innovative products can help to take your business to next level.