Ok so I was online today, and someone was asking about credit card fees and how they are such a nuisance.
So I created this post to help you understand how to reduce your Credit Card processing bill and more or less keep them from being a thing.
This is accomplished purely through the extended use of math
First what percentage of your customers use credit card financing, you can find this out by looking at your processing statement for the year and comparing it to your overall revenue. for example I had one million dollars in sales last year
$1,000,000
And I processed one hundred and fifty thousand in credit card sales
$150,000
Simply divide the $150,000/$1,000,000 That equals .15 or 15%
now you know 15% is how many of your customers use credit cards.
Then you want to take your processing fees and divide them by how much you processed. You simply look at your credit card bill and find out what you were charged.
So out of the one hundred and fifty thousand ($150,000)processed you paid four thousand six hundred and fifty dollars in fees ($4650).
Simply divide $4650/$150,000 to find what percentage of your credit card processing are fees. That equals .031 or 3.1% Its important to get this number because banks tend to sneak in fees that you don’t see till you calculate processing.
So now you will take your processing fees again and divide them by your total revenue $4650/$1,000,000 you will get .00465 or .465 percent%
You subtract .465% from 100% and you will get 99.535% You will then change the percentage back into a decimals (.99535) and create this math problem.
You will take the price of anything you sell and divide it by the decimal. So for example if you are selling a ten thousand dollar job ($10,000 ) you will take that number and divide it by the decimal. For example 10,000/.99535 it equals roughly ten thousand fourty-seven dollars. ($10,047)
Now your Credit Card fees are covered, but you have to do that across the board to all of your prices.
