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CBD products offer people the opportunity to treat pain and live healthier lives, with a variety of options for use that cater to the specific goals of each customer. It’s no wonder they’re getting to be such a growing industry. If you’re getting the ball rolling on a business that offers CBD derivative products like infused foods, topical ointments, or oils, you might be finding that one of the challenges of working in such a new and fast-paced industry is that there are not a lot of guideposts telling you how it should run. Luckily, you can follow a pretty basic retail playbook for CBD products because they are widely available as over the counter supplements and creams. In that case, one of the first things you need to do is to set yourself up with a merchant account and credit card processing agreement.
Attract Customers With More Payment Options
New companies thrive on their ability to bring in prospective customers and acquaint them with the operation, and customers don’t generally shop where they have limited options. CBD merchant processing allows you to take credit and debit card payments, which are the most popular payment methods for most customers, making them more likely to shop with you. If you’re running your storefront online, you really need a merchant account so you can stay away from expensive third-party processing that cuts into your bottom line. There are also additional payment types and services you may want to consider, depending on your exact business model.
- High risk processors
- NFC payment processing
- ACH processing
- Mobile payment apps of various types
Choosing a Merchant Processor for eCommerce
In some cases, your best choice of payment processor will depend on how you do most of your business. Companies that make most of their sales online are often forced to deal with higher rates of chargeback fraud, as well as other forms of financial fraud and attempts at compromising their operation. Getting the most out of your eCommerce experience means finding a processor whose policies are robust in those areas, so you have the tools needed to identify and respond to these issues as they arise. Those tools are sometimes more expensive, though, which is why high risk payment processing does cost a little more than average. Payment rates are also worth investigating and comparing across plans, and they can be complex. They also affect all kinds of businesses, even those operating solely in a brick and mortar environment.
Understanding Merchant Service Pricing Plan Choices
Each of these three major pricing options has its own strengths and weaknesses, and each is ideal for a different type of customer. That’s why sometimes you see all of these options from the same processor. It’s also why you are more likely to see specialty processors only offer one type of plan, it’s the pricing option that works with the specialty services they offer.
- Flat Rate Pricing: This option is what it sounds like, you pay a single percentage rate for all your transactions. Credit or debit, same rate. Large or small transaction, same rate. It’s easy to understand, and plans like this tend to streamline other expenses, making them easier to afford when you have limited card sales or small average transaction sizes. Many flat rate plans also have a surcharge or minimum charge in addition to the rate charge. An example would be a plan that charges 25 cents per transaction and one percent of the transaction value.
- Interchange-Plus: Every card from every issuer out there has its own interchange rate, which is the actual cost of the transaction when it is processed. Sometimes, two card options from the same issuing bank will have different rates. These plans are the most common ones for small companies with moderate to high sales volumes. Plan costs tend to be phrased in terms like interchange plus two, for two percent over whatever that rate is for an individual card. There are also additional surcharges to these plans that may apply for some card transactions, so check out the details of quoted plan agreements.
- Tiered Pricing: This pricing plan arranges card issuers into several pricing tiers, with those perceived as higher risk or with higher interchange costs in the tiers that are pricier. Many tiered plans also omit surcharges in favor of simplifying bills by breaking down the number of transactions at each tier. As a result, they can be less costly for high volume customers than interchange-plus plans. As a trade-off, many options for tiered plans charge a monthly maintenance fee not found in other plan types. The monthly fee is hardly universal, though.
Set Up CBD Merchant Processing Today
Credit card transactions make up the largest share of retail transaction types, so don’t miss out on your chance to tap into the widest customer base possible. All it takes is a little time to get yourself set up for processing payments online and offline, with the equipment that best suits your business.
How Merchant Processing Can Help Your CBD Business from Instabill.