Having a multi-location franchise is a fantastic thing. It means your business is growing and bringing in extra profits.
But managing how your franchise accepts payments can be a different story.
As you grow, it’s logical to think you need to use a big bank to handle all your payment processing requirements. But working with a larger bank means a lot of restrictions and a lot of waiting. Having a person who handles your accounts is a fantasy.
What’s worse is larger financial institutions traditionally want to give you a flat rate and give you one big statement for all your locations.
But that might end up costing you more money in the long run.
One of the biggest problems you may face with having a single flat rate is it doesn’t account for different types of cards.
Every individual card brand (Visa, Mastercard, American Express) has separate interchange rates, so your rates may vary from location to location
All credit card processors have the same exact cost for the card brands (Visa/MC/Discover) called interchange. Each processor has slightly differing soft costs, like marketing, support, sales, but their hard costs or “interchange” are the same, and there is no pricing benefit for using a large processor over a smaller competitor or vice versa.
So the main problem comes from every store should have records of your processing rates. Otherwise, it can be difficult to track when you’re getting ripped off.
Wheel Fun Rentals found themselves in a similar situation. Previously, they had relied on a big bank to provide their merchant services. They struggled with subpar customer service and customer support issues, couldn't get a response when their business needed it, and fought through a lack of support at their thirteen locations.
In addition to the lack of support, they wanted to have their payment processing from each location to be broken up, so they could track their fees better. But the large bank wouldn’t allow them.
Over time, the team at Wheel Fun Rentals became disappointed with bureaucratic process of payments with their local bank as it was affecting their ability to fix credit card terminals and process credit cards.
Eventually, Wheel Fun Rentals found a better option for their franchise to handle payments. After a bit of researching, they chose to work with BNG Payments, who separates their processing for each location. This allows Wheel Fun Rentals the freedom to manage their multiple locations processing rates.
You can read more about how Wheel Fun Rentals found success with their business.