The lengths Costco, Elevon and others will go to get your business…
You are a savvy businessperson. If you started your business within the last three years… during a near recession AND you’re making money, you have to be doing something right.
So, why is it hard to figure out which merchant service provider will support your online sales?
The truth about Costco merchant services
When you look at Costco you figure they have been in business for a while so they must be doing something right too. You are tempted to sign up for services with Costco because you have brand loyalty… Costco has brand recognition.
This is what they are counting on.
After all, most people sign up because they have consumer confidence in a company or brand.
If you go to their website you will see a spokesperson named “Joe”, kind of an everyman.
Someone you can relate to.
Their website cheerily urges you to “Meet Joe.” The copy reads: “he is going to save $1,719. this year.” And the bullet points proclaim:
- no application fee
- no statement fee
- no annual fees
- no batch fees
- no PCI fees
That got your attention.
You notice the rates are all in RED and they seem to be lower than other merchant service providers you were thinking about using.
But wait a minute… you take another look at “Joe” and you notice he is smiling so broadly that his eyes are shut. Joe thinks he has gotten a deal, but in reality he can’t see the fine print, both literally and figuratively.
YOU look a little closer and notice that all the important contractual language is in a pale grey font that you can barely see.
What the fine print will tell you is you will have to sign a contract and there will be a penalty to get out of it (commonly called an early termination fee) — and the great rates in RED are for qualified transactions only, reward cards process at a higher rate and fees may change without notice.
The truth is Costco is NOT in the merchant processing business, or the credit card processing business.
They don’t set up your account, manage it, or provide solutions if you are having a problem. Costco has teamed with Elavon (formerly NOVA) to handle their Merchant Service Accounts because they provided Costco with the greatest incentives to partner with them.
It may be a great deal for Costco, but not for you.
Whether you are a new merchant account or you are looking for a better deal, it makes sense to compare companies and LOOK closely at the fine print.
After all, it’s your business… and your money.
I hope you found this information helpful. Please feel free to share your comments below.
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