(The Answer is YES!)
For some business owners, they feel like they are taking the right cost-cutting measures. Why take American Express, which charges slightly higher fees, when my customers usually have Visa or MasterCard as a backup?
For example, Barry’s Burger Joint decided not to take American Express. When John pays for his dinner for four, the server tells him they don’t accept the card. John reaches back in to his wallet and uses his Visa card. All good, right? Wrong!
Barry’s Burger Joint has just alienated a customer. Not only that, but John uses his American Express card as a main way to earn points on purchases. The next time he is considering a night out, there’s a good chance Barry’s Burger Joint won’t be on the list. Return customers make up a huge part of a business’ revenue. While John may return, the gap between visits has just widened.
Was this worth it for Barry’s Burger Joint? Considering less than 10% of its customers use American Express, it doesn’t make a major impact on overall merchant processing fees.
Furthermore, American Express has reduced merchant fees dramatically over the last 15 years. At a presentation for investors in 2018, the company said the global average of fees it charges merchants is down to about 2.37 percent, compared to about 2.57 percent in 2005.
American Express also offers OptBlue as an option for small businesses that are operating on lower margins. OptBlue allows merchants to “bundle” AmEx with other credit cards, meaning one point of contact, one statement, and more transparent interchange fees.
OptBlue fees are paid by the merchant and not set by American Express. Fees are determined by the merchant account provider in the same way Visa, Mastercard and Discover are set. These rates ARE negotiable.
Analytics show that American Express cardholders tend to spend more. Whether you need to speed up collections on invoices, or gain new customers, you should make it as easy and as pleasant as possible for your customers to pay for your services. Customer satisfaction, increased sales opportunities, and better customer service makes accepting American Express a smart investment for your business.
About Best Card
Best Card was founded in 2008. The organization provides payment processing equipment and services to merchants of all sizes, in all 50 states. To learn more about the Best Card, visit www.bestcardpayments.com