In almost every advertisiement I see for merhant accounts these days I see the term “no hidden fees.”  However, when you examine the small print these companies almost always turn out to have just that – lots of hidden fees!  Costco provides a great example of this; they advertise unbeatable credit card processing rates of 1.64% and 1.99% every month in their magazine along with the phrase “no hidden fees.”  Here is a recent add from their magazine:

Any business that signs up for this offer will realize this advertisement is misleading. Expecting to pay these rates, they would be unpleasantly surprised to find out that the actual rates are:

• 1.64% and $.20 for swiped transactions
• 1.99% and $.27 for non swiped transactions
• 2.96% $.32 for rewards, business, corporate, non-AVS, authorizations not settled within 24 hours, and a host of other conditions.
• 3.80% $.32 for government or international cards

No hidden fees? Whatever!  Bottom line: read the small print!

If you have the freedom to choose, or design, the way a company operates why not go with what would make you happy if you were a client, employee or vendor of your company?  I really believe this is the only way to go when building a business. One characteristic I would love to see as a customer of any business is transparency.

To me this simply means telling the truth about your business to every party involved.  Is your business young, small, under capitalized, struggling, in a law suit, etc. Let everyone involved know what really is happening.  Have you screwed up, made a mistake, even failed?  Then brag about your experience and tell people what lessons you learned.  In other words turn supposed weaknesses into strengths.  When you do your company will stand out as unique and special in a sea of half-truths and exaggerations.

We practice transparency by telling our clients what our costs are and what are profit is by having them as a client each month.  It is a simple thing to do but since no one else does this it makes us stand out.  I have noticed that standing out is usually a good thing.

Practicing transparency at this very moment, I will say that as I write this post it is 10:30PM and I am a little tired so I am going finish right here and go to bed.  I’ll pick this topic up in another post.  I will conclude by saying isn’t transparency easier? How about refreshing?  So why not give it a try?  I think you will like it.

I been noticing a clear trend in recent weeks – selling my services is getting much, much easier.  When I was an employee in the merchant account industry I worked for one of the best companies in the industry.  Heck, they are the ones that introduced me to “Straight Pass Through” pricing and “Interchange Plus.”  Even though we were always the good guys with no hidden fees and quality service, it was often a challenge to stand out amongst our competitors.

With my own company and a few adjustments to the way we do business things are almost getting easy!  As an employee our pitch was all about our pricing.  Now pricing is just one componant.  Today, I was talking to a business woman who’s company just purchased a hotel property that is part of a national chain.  During our conversation I listened to what I was saying and these are a few of the things that came out of my mouth:

1. We only price clients with Interchange plus (no hidden fees)

2. We want out clients to call us first; let us know the issue and we’ll get it fixed.  We don’t want you calling a call center and being on hold for one minute; let us be on hold in your place.

3. We have no contract term with a early termination fee; if we stink you can leave whenever you want.

4. My costs are…my profit margin is…so my company will make approximately…

5. Did I mention the funds from your transactions will be in your bank account the next business day?

6. From the moment I have your completed application it will take 24-48 hours to have you up and running.

7. No, I don’t need a personal guarantee.

8. No, I don’t need financials.

9. Of course I am familiar with your payment gateway company.

10. Ok, I’ll have the paperwork over to you with in a few minutes.

Man, I love being in control of how we operate!  No wonder adding clients to our roster is getting easier!

Bottom line: Be the very best you can be.  Be transparent, fast, fair and simple; then adding clients will get a lot easier for you.

I know yesterday I wrote I am not really into posting videos; I guess I have changed. Last wee ABC’s Night Line was at the offices of Zappos.com…you know the online shoe company? If you are not familiar with them now, you will want to be after watching the video NightLine produced.

The reason I am posting it here is because Zappos.com is a model of what I think a business should look like. If Tony Hsieh, can build a great company then so can others. I want to be one of those “others.”

Here is where to check out the video:

NightLine Video – Zappos.com

Here is Inc. Magazine article about Tony and Zappos.com:

How I Did It: Tony Hsieh, CEO, Zappos.com

I received a call from a reporter at US News an World Report two weeks ago. His name was Matt Bandyk, a business writer for the magazine. He had found me through my other blog straightpassthroug.biz and he had some questions about how businesses could lower their merchant account processing fees.  We talked for over a half hour and the I provided him contact information for two of my favorite clients who he also interviewed for the article.  That is enough of my story, here is a link to the article:

How to Deal With Credit Card Mumbo Jumbo

When I woke up today I sarted my day with Seth Godin’s newest blog post.  In the post he writes about a custom t-shirt company that calls him three days after he put in his order.  Was there a problem?  Not at all, they had noticed the t-shirt was for a non-profit cause and were calling Mr. Godin to see if they could contribute to the cause.  This was a total surprise for Seth; there was nothing on the t-shirt company’s website bragging about such a policy.  So he concluded his pst with a new rule: “The value of a perk is inversely related to the expectation of that perk”

I agree with him, this t-shirt company was doing this not because it would bring them accolades or so they could write about on their blog.  Nope they did this because of who they are as a company, because they think contributing to causes is the right thing to do.

I have to tell you that I love the new business world, whatever label you want to put on it.  This is truly a new world where the good guys do finsih first.  I look forward to creating value and having it be a urprise to our clients.

This sounds like an obvious characteristic every business would strive for. However, when I look around and examine my experiences with businesses I often see the idea of making as much money as possible while creating as little value as necessary. Of course I also see companies like Apple that have clearly realized the correlation between creating value and profit.

In his book, How To Be Rich, J. Paul Getty, once the richest man in the word wrote,”The businessman should never lose sight of the central aim of all business — to produce more and better goods or provide more and better services to more people at lower cost.” “More” and “better” are the words that stick out to me in this quote.

So why wouldn’t a business focus on increasing the value of it’s product or service? My mind keeps coming back to two reasons:

1. Lack of awareness of the motive behind the business.
2. Lack of awareness that value creation and profit go together.

Let’s start with motive, why is the business person or corporation operating? I mean the real reason, what drives them?  I don’t believe the motive matters, as long as it is not immoral.  It could be money, ceating jobs, building a better world or even feeding the ego of the owner or CEO.  The key is being aware of the motive and connecting that motive to the every aspect of the business.

Here is an example; I was watching one of my favorite TV shows the other night, The Business of Innovation on CNBC.  The show was focused on company social responsibility (watch it here).  One of the interviews was with the CEO of Timberland, Jeffrey Swartz, who’s family founded the business.  The interview revealed a strong commitment the family and business have to the environment.  Then the discussion moved to the idea of balancing that passion with their commitment to their share holders (profit).  It was a great interview that me made want to buy all my shoes from Timberland.  Bottom line?  What I saw in this CEO and his company was a deep connection to it’s base motive – family pride.  I truly believe they are so proud of what they have created that they are driven to keep building an operating a great company.

In contrast, the mediocrity enerprise is arrived at by not knowing what drives it which results in a lack of passion and vision.  Somewhere in the Bible, I think it the book of Proverbs, it says, “where there is no vision, the people perish.”  When we business types don’t know what really drives us, then we have no vision for greatness and when there is no vision the business will eventually fail.  So discovering what motivates a business is essential.

My second point was realizing that value creation is central to operating a successful business.  I don’t think I need to expounon this, it’s pretty obvious.

So here is how this plays out with myself and Cocard Synergy.  What drives me is esteem, how I and others regard me, myself.  In other words I want to be great. I want to be proud of myself and I want others to see me as a great human being.  Therefore, I will build a great company that produces esteem for me.  I know this confession sounds a little narcisitic but it is the truth; it’s just who I am.

So why I am I committed to creating and increasing value to our clients?  Because I want to be esteemed highly and I have connected that desire with creating a special, unique, innovative and profitable business, which means come hell or high water we will create value (among other things)!

Do you see it?  Do you know what your base motation is?  Once realized can you take that motive and turn it into a vision?  I am in that process now when will you start?

Another Post: More on Creating Value

Yes, the name is Cocard.  I have had many people ask what the heck Cocard is.  According to a recent press release Cocard is a Nashville, TN based merchant services provider currently serving over 25,000 merchants.  The release goes on to say, “Cocard is a cooperative of bankcard professionals with 48 members and approximately 600 sales representatives located in over 60 offices throughout the continental U.S..”

So Cocard is a group of bankcard professionals who have come together as one to share resources, negotiate better pricing and basically take over the world.  I added that last part just to see if you are awake!  The bar is pretty high to get into this organization which means that if you are dealing with any office with the Cocard name in font of it you are going to receive great service and honest rates.

The reasons I chose to become a part of Cocard are:

1. Integrity – I wanted to be a part of a integral group that I could be proud be a part of.
2. Relationships – Cocard is set up with only the largest and the best payment processors and third party vendors in North America.
3. Rates – because Cocard has such a large portfolio of quality merchants the rates they have negotiated are much better than I would have received on my own.
4. Control – I am able to run my own business within Cocard (as log as I follow the rules).  This means I am able to choose and build my own price models and I don’t have to wait for someone’s approval to take quick and decisive actions for the benefit of our clients.

So I have the best of both worlds, the pricing of a large organization and the ability to make my own business as great as I want it to be.

I’ll be writing more about Cocard in the future but if you have any immediate questions you want answered feel free to comment below and I will respond promptly.

More reading: What Greensheet has to say about Cocard.

Yesterday I said I wanted to build the “anti-merchant account company.”  Now it is time for me to define what I mean by that.  So I am going to start writing about a single value each day that I am building into the DNA of this company from the very beginning.

I am going to start with the most important value, which is love.  I know this sounds a little funny for a businesses first value to be love, but why not?  I was first introduced to this word being applied to business when I read Love is the Killer App several years ago.  In this book the author, Tim Sanders, the former Chief Solutions Officer at Yahoo!, expounds about actually focusing on loving you clients and co-workers.  Since I read his book, the idea of loving clients has been in the forefront of my mind, nonetheless I have both failed miserably and succeeded greatly at applying his message.

As a result of trying to live this out I have learned a few things that have shaped my defenition of this value.  Here is what I mean by love as a value for this company:

• Seeing clients as people not just profit centers.
• Asking, from the very start, “how may I serve you?” and then actually listening to their answer.
• Going out of our way to create extra value for each client, no matter how large or small they are.
• Creating ways to share knowledge that will help our clients grow and prosper.
• Taking full responsibility when the sh** hits the fan; even when we did not cause the problem.
• Telling the truth, even when it hurts, even though we may lose a client.

Doesn’t this all seem like basic stuff?  This is just “golden rule” behavior and yet, surprisingly, I believe these types of actions make us stand out now and always will.  If we were to just focus on this value I think we would succeed at building the “anti-merchant account company.”  However, this is just the first value I am ging to write about as we set out to build one kick butt company.

This is an exciting moment for me – this is the very first blog post for this new blog that I have started to document the journey of starting a new credit card processing company. One of my central business values is transparency. As a result, I am going to do my best to lay out all the challenges and victories for starting a business from almost nothing. I have been tempted to just pretend this company has 200 employees and has been around for years but that is not the case.

Having said that I do want to point out that we are part of a large group ISO named Cocard and partner with the very largest payment processors in North America – First Data, Chase Paymentech and National Processing Company. So in some ways we are not small at all.

So why is this business start up such a challenge? Typical answers might be a lack of significant capital, support staff or just going through the whole process of establishing our identity. Those are all challenges to be sure but the story will become interesting because of the type of company we are committed to building.

When I want to use as few words to describe what our vision is I say we are starting the “anti-merchant account company.” I know that phrase sounds a little arrogant, and a tad idealistic, but I promise you our intentions are true and all we want to do is build a company we can be extremely and profoundly proud of.

I am not much for long blog posts so this is all for now. in my next post I will start describing what an “anti-merchant account company” looks like in my mind.