For years many retailers have thought that accepting American Express was more costly than taking a Visa, MasterCard or Discover card from their customer. It was also more work since American Express required a different application process for approval, and sales deposits settled into your bank account separately from your other credit card sales. On average most businesses see around 53% of their credit card sales volume from Visa, 22% from MasterCard, 21% from American Express and 4% from Discover, so not accepting American Express could directly be impacting your bottom line. If you’re not accepting American Express today here’s why you should think again:
If your business would process less than $1,000,000 per year in Amex sales, American Express OptBlue is something you should consider. With OptBlue all sales deposits are combined with your other credit card sales and you’ll receive one monthly statement for all your credit card processing, which makes reconciliation much simpler for merchants. (For merchants with Amex sales more than $1,000,000 annually a direct merchant account with Amex is still required.)
With OptBlue, the fees paid by the merchant are not set by American Express. They are determined by the merchant account provider in the same way your rates are set for Visa, Mastercard and Discover. These rates are negotiable, and merchants should be wary if your provider tells you something otherwise or tries to bury hidden fees that vary month to month. If you’re on a tiered pricing structure or your processor is tacking on a big mark-up, you may not see benefits from OptBlue and should consider switching processors.
Amex also recently announced lower rates for emerging markets like colleges, universities, schools, child care services, government services, insurance and direct marketing continuity/subscription, and expanded OptBlue to include more franchise chains. Contact us for details.
There is no separate application process for American Express OptBlue and you can get set up through your existing processor. When changes occur in your business or you need support you will have one point of contact to deal with regarding all your credit card processing. If you are currently accepting American Express under their direct program but your sales are under $1,000,000 annually, you are paying more than you should be and your processor has dropped the ball on switching you to OptBlue.
None of the credit card brands require you to sign a long-term contract, but there are processors that do. Unfortunately, some processors share false information to convince merchants to sign up for agreements that include long-term contracts, hidden fees and high termination fees. Merchants should seek processors that provide transparent pricing and earn your business by providing white-glove level customer support and service.
American Express attracts an up-scale demographic, and their cardholders tend to be affluent business people that spend more per sale and use their card more often. They are less likely to dispute sales, return items and default on payment obligations. Are these sales your business can afford to miss out on?
If you need help deciding whether American Express makes sense for your business, contact us for a free, no obligation cost-savings analysis today.