When it comes to serving customers, your restaurant needs more than just great food.
Restaurant patrons consistently rate other factors above food quality, including a comfortable environment and stellar customer service. While a lot of work goes into creating an ambiance and grooming a well-trained staff, one of the most immediate ways to positively impact your restaurant’s bottom line is with a highly functional, adaptable, and reasonably priced payment processor.
In this article, we’ll review the steps you should take as you search for your restaurant’s credit card processing solution.
A payment processor is a service that gives you the capability to accept payments via credit, debit, and EBT cards. Without this function, someone could hand you a credit card, but you wouldn’t have a way to translate a swipe into a financial transaction. Or, you would be limited to accepting only cash and checks. In 2021, this isn’t an option.
Now that you know to find a credit and debit card processor, the next step is choosing the best solution. You want something that can work with your current system or adapt as you grow. You’ll also want something that fits your operational needs. For example, if you offer delivery and accept payments remotely, you might need a different system than a restaurant that only takes payments via a credit card swipe.
By taking a systematic approach and evaluating your merchant processing options from every relevant aspect of your restaurant business, you’ll be poised to find a solution that fits your restaurant’s requirements.
We’ve outlined the six steps any prudent restaurant owner should take before committing to a solution.
Before evaluating potential solutions, you must have a clear vision of what services you require. Do you want to accept all types of credit cards? Will you be accepting payments over the phone? Will delivery drivers be taking payments?
These last two questions address the sometimes-tricky issue of a “card not present” transaction. Because these transactions have a higher instance of fraud, fees can be higher if your restaurant needs this payment acceptance capability.
Different payment methods can result in varying fees, and not all services are available among all processors.
As you research potential options, know the financials of your business, including:
These factors can affect your transaction fees. Some processors also require a minimum monthly transaction value. Falling below a specific threshold can result in you being referred to another processor or having to pay additional fees. If your business is seasonal or variable, you’ll want to know what these terms are.
Because there’s such a wide array of service levels and transaction fees, you’ll probably get many different opinions from other restauranters. Each industry, including the restaurant business, has unique practices and quirks that can require special accommodations.
If you talk to half a dozen or so restaurant owners and operators, you’re bound to hear some interesting stories that will help you narrow down the field or discover a diamond in the rough.
You’ve probably noticed that banks want to be everything to everybody. As soon as you open an account, they want you to refinance your car, buy a house, open a line of credit, and start an investment account with them.
Though it’s in the best interest of your bank to sell you on a credit card processing solution, it might not be in your best interest. In all likelihood, your bank might try to convince you of the convenience of having all of your financial tools in one place without disclosing that you could end up paying hidden fees and while subjecting your business to less than favorable terms.
On average, a restaurant changes its point of sale (POS) system every five to seven years. This timeframe reflects the evolution of technological advancements that move a POS system to end of life status.
If you are sticking with your current POS provider, you may be stuck with whatever credit card processing system they offer. Instead, ask them for some recommendations for your merchant account.
However, if you upgrade your POS system or start from scratch, you have more flexibility here.
It’s not uncommon for merchant service solutions to come with lengthy contracts filled with fine print and complex terminology. While much of what you’ll see in these contracts are boilerplate and uniform across the industry, there are some essential things to look out for.
Specifically, you’ll want to make a note of whether or not the credit card processing company will allow you to switch services or if you’ll be locked into a contract. If your business’s needs suddenly change and your current provider doesn’t offer the service you need, this can be problematic.
For example, the proliferation of services like Postmates and UberEats and the expansion of food delivery during the pandemic caused many restaurants to pivot and adapt their service models. In turn, this also affected how many of them accepted off-site payments.
Our advice is to seek out credit card processing companies that offer flexible terms and month-to-month pricing models. If you are locked into a contract, be on the lookout for early termination fees.
Also, don’t forget to find out if you can lock in a favorable rate. Sometimes, the fine print might reveal that your rates can change at any time for any reason, and that can wreak havoc on your finances. It’s also a good idea to find out if, and how much, the company charges for application and set up. Though the current trend has been to eliminate these charges, some companies still collect.
To sum up, this step, look at the following terms in an agreement with a restaurant credit card processor:
Credit card processing equipment is expensive, and some providers have chosen to offset the cost in creative ways. Be sure to find out if you can buy the card readers outright instead of leasing them. Though the upfront cost might seem high, you’ll be saving money in the long run.
We also recommend being wary of “free” equipment programs. Though not all are necessarily bad, you should make sure that the cost of this supposedly free equipment isn’t being passed on to you somewhere else in your contract.
At Accredited Interchange, we work with various industries, and we pride ourselves on finding the best solutions for each. For our restaurant clients, we offer Clover. Hands down, Clover is the best restaurant POS in the industry. It provides numerous features that make the life of a restaurant owner easier (and more profitable), including:
By having our finger on the pulse of the restaurant industry, we’re able to offer you everything you need to run your restaurant without excessive monthly fees.
We offer a complimentary analysis to review your current needs and see how we can help you thrive.