07 Aug 3 Processing Pitfalls in the Concrete Industry (and How to Avoid Them)
The concrete and aggregate industry is growing. Industry analysts expect the concrete and cement market to grow 7.95% by 2023, and the US cement manufacturing market is on track to reach 10.5 billion dollars of revenue by 2022. All that growth means it’s more important than ever to optimize your operations.
Incorporating credit card acceptance into your business model can increase cash flow and reduce time spent on accounts receivable processes. But processing for concrete and aggregate businesses looks very different than the typical retail model. Transactions are often entangled with invoices, mail and telephone (MOTO) orders, and business and government cards. If you’re not careful, this can lead to a number of expensive complications when processing cards.
Here are the biggest processing pitfalls in the concrete industry, and tips on how to avoid them:
1. B2B and B2G Transactions Are Expensive
Most transactions for concrete and aggregate services don’t take place face-to-face. That means any card you accept will likely be over the phone, online, or via mail order. Unfortunately, business-to-business (B2B) and business-to-government (B2G) transactions can have higher interchange rates for two reasons.
- Most business cards offer rewards programs. Offering an annual $1,000 travel bonus or 2% cash back on all purchases isn’t cheap, so card associations charge higher interchange to cover their own costs.
- Card-not-present (CNP) transactions are considered higher risk. If a card is keyed instead of being swiped or dipped, a transaction is generally subject to higher rates. This is because, if a customer is not physically present, the risk of fraud is higher.
The solution: Level II & Level III Rates. Level II and Level III rates can offer significant savings and are only available for B2B/B2G transactions. However, in order to qualify for these rates, additional data must be submitted with every transaction. Typically, between 5 and 19 additional items of data are required. Taking the time to enter all that extra information manually just isn’t practical when you’re already juggling multiple projects. A virtual terminal that can automatically capture all this extra data will help qualify your transactions at the lowest possible rates with no extra effort on your part!
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2. Chargebacks Are Cutting into Your Bottom Line
Finding the time and resources to evaluate and implement fraud & chargeback prevention tools can be a struggle. But you shouldn’t consider taking no action an option. Shipping supplies bought with a stolen credit card means you’ll be stuck with the bill when the actual cardholder disputes the transaction. Even if a transaction is legitimate, ignoring a chargeback means you’ll still be out that money. Chargebacks can cost your business thousands of dollars, and that’s not even considering the loss of expensive supplies and inventory.
Once a chargeback is issued, you only have a limited window of time to submit documentation to dispute it.
The solution: Find a processor that will help you win chargebacks. The most valuable resource you have when fighting a chargeback is time. Usually, you’ll be notified of a disputed transaction via mail. How closely and how often do you go through the stacks of mail that your business receives? This is why it’s so important to work with a processor that will quickly notify you of disputed transactions and help you through the complicated chargeback process. Otherwise, you might lose a chargeback before you even have the chance to respond.
3. Some Jobs Cost More Than the Original Estimate
While you most likely conduct an estimate before starting a job, final totals often differ from that initial projection. That’s why many concrete and aggregate businesses don’t charge a client until the work’s already been done. Unfortunately, if you’re not verifying funds in advance, it’s possible that your client isn’t good for the final ticket amount. Essentially, you’re taking it on faith that they have enough money to pay you once the job’s completed.
The solution: Validate available funds in advance with authorization holds. Utilize a processing solution that will allow you to place an authorization hold, then settle for the final amount. When you conduct the estimate and pre-authorize the card, you’ll receive an authorization from the bank that sufficient funds are available, and a decline if they’re not. Upon completing a project, the authorization can be settled for an adjusted final amount. Authorization holds on credit cards can last up to 30 days, depending on the issuing bank.
Final Thoughts
If these 3 processing pitfalls are impacting your operation, the right processor can help. You’re busy managing inventory, keeping jobs on schedule, and securing new business, so you need a partner that understands the problems facing your industry and how to solve them. Make sure you’re receiving the personalized service and great customer support that you need to keep your business running smoothly.
BASYS Processing as a business partner
Does your current processor understand the unique struggles of your industry? Do they provide great rates and personal customer service? Are they offering solutions to grow your business and being proactive about helping you reduce risk and increase your savings?
Contact BASYS today to learn more about innovative payment solutions that will save you time and money. We make accepting debit cards and credit cards convenient, safe and affordable.
BASYS Processing features:
• A friendly, live voice will answer the phone when you call; no automated phone systems
• In-house PCI Compliance team to walk you through the process step-by-step, improving security and reducing costs
• Accept payments in person, over the phone or online
• Next-day funding options
About BASYS Processing
BASYS Processing provides credit card and debit card processing services, plus solutions that include terminals, virtual terminals, e-commerce, mobile, and point-of-sale, customized to fit any need. Banks, associations, and software partners depend on us to strengthen their reputations and relationships with their customers by providing remarkable service paired with ultimate flexibility and pricing. Merchants depend on us to make accepting credit cards and debit cards convenient, safe & affordable. BASYS was founded in 2002 on one philosophy: to take care of our merchants, partners, and employees so they never want to leave. We are dedicated to working one-on-one with our customers to design the perfect solution. BASYS is Personal Payment Processing.
Learn more at basyspro.com, and connect with us online at: